Digital Music Startup Beyond Oblivion Burns Through $87M, Crashes Before Launch
(UPDATE 3) Beyond Oblivion has sung its last song before launching its first product, a music service dubbed "boinc". Funded by News Corp, The Wellcome Foundation and media investment bank Allen & Co, the company burned through $87 million since opening in 2008. Founder Adam Kidron blamed demands for advances to labels and publishers for the failure.
Beyond Oblivion touted "boinc", as a cloud based music service supported by device manufacturers paying a one-time life-of-device fee alongside micro-royalty per play payments whether the original file had been downloaded legally or illegally.
Kidron confirmed that the Beyond Oblivion was closing in a statement that blamed the company's failure on the difficulty of “co-ordinating the diversity of the ecosystem” which includes artists, labels, publishers and device manufacturers".
“Beyond was always a tremendously grand ambition as the advances required by the record labels and music publishers were substantial, reflecting the breadth of the rights required to create a true digital music one-stop,” said Kidron, who ended with: “Until victory always.”
UPDATE: Under the banner "You can't make this stuff up", Dalton Caldwell points to this now ironic Gaurdian piece on Beyond Oblivian from March 2011:
Beyond Oblivion, the online music marketplace partly owned by Rupert Murdoch’s News Corporation, has secured $77m (£47m) in additional investment ahead of its worldwide launch later this year.
“The fledgling company plans to unveil its “liberated music” marketplace in September. Negotiations with the four major record labels – Universal, Warner Music, Sony and EMI – are at a “very advanced stage”, according to the Beyond Oblivion founder and chief executive, Adam Kidron…
“We’re going to launch with $500m revenue guarantees, and we pay a large proportion of that – between 70% and 90% – back to content owners.
The News Corp chief digital officer, Jon Miller, added: “Our additional investment in this business serves as an endorsement of the progress that Beyond Oblivion has made in bringing this innovative new music product to market.”
Note: A previous verison of this story had misnamed the defunct service as bionic. It was to be called "boinc".
They picked the right name thn…
Everything News Corp touches turns in to Myspace.
Adam Kidron. The same Adam Kidron who used to be the CEO or UBO (Urban Box Office) who went out of business just a few years ago. This guy is known for cut and run stuff. He has been known in this industry for having issues maintaining he’s funding due to poor decision making. This is no surprise to me.
Sorry, I’ve read this twice and their business model is still unclear as shit. “Bionic” —-> Profit???
Welcome to the real world, Adam. Nobody wants to allow you to succeed unless they get theirs first.
The VC suckers who backed you should be fired for having bought into your fantasy. And, they should all be forced to read “Rework” and give a book report to their BoD before being allowed to invest another red cent. Idiots.
Yes, Rework is good.
Wow. It was called Boinc, not “Bionic”, way to do your research “reporter”
Despite his poor record as an entrepreneur, Kidron still gets my props for that first Orange Juice album and all those ace Politti sides…
Damned music industry parasites! They always cite the best of intentions and usually end up doing the most damage.
The $87 Million in question could have been much better spent on 87 emerging artists. What an idiot.
Hey at least he spelled “Oblivian” right… oh wait…
C’mon Bruce… a spell check should be in your list of new year’s resolutions.
Well where does 87 million go on a company that doesn’t open its doors. I bet Kidron isn’t hurting for cash…. you go bo_Y inc. I can come up with a company that won’t open and I only want, er, I mean need, $7.6 million, that’s a steal… Do I have any takers? There must be some VCs who are interested.
Ha! Good one!
Sounds like he/they made the same mistakes so many start-ups make (myself included)…trying to be larger than life before they’re even out of the gate. As someone mentioned above…read the book ‘Rework’.
They did not get the entire funding pledge from Wellcome Trust. 50 million was held contingent on raising the label licensing fees prior to launch. Does anyone fucking fact check anymore?
Tom – A few days after this story break, when it came out about the $50M, we reported it in our daily morning news briefing.