Another Music Service Shuts Down, Blames Ridiculous Licensing Fees
from the but-of-course dept
But good services are the key to getting people to actually go to authorized means of acquiring and listening to music. Unfortunately, there is a very small number of such services, in large part because of these crazy licensing demands. David Meyer, over at GigaOm, highlights how Wahwah.fm has shut down due to the licensing demands of labels, saying that they just couldn't build a sustainable business at the rates demanded. While Stuart Dredge correctly notes that there are a number of issues at play, including a perhaps less-than-stellar takeup from users, the licensing costs certainly couldn't have helped. For a startup like Wahwah that is figuring out the right model, the fact is that they don't have much runway to experiment and find the model that works, because the licensing demands are almost impossible to afford unless you've raised a ton of money that you want to flush away.
Plenty of startups would love to build a new business offering licensed, legitimate music services, but they're scared off by the hostility of the old industry to anyone wishing to build a useful service. The end result is that the legacy industry and the RIAA are responsible for prolonging the problem, by not enabling new innovators to build the kinds of services that successfully compete against piracy.