Page last updated at 10:54 GMT, Friday, 5 December 2008

Musicians tap new revenue model

By Maggie Shiels
Technology reporter, BBC News, Silicon Valley

tap tap revenge screenshot
Tap Tap Revenge is ranked number three in the App Store for 2008

With CD sales in decline the music industry is looking for novel ways to recover some of its dwindling revenue.

Not least because the rising popularity of digital downloads will not make up the shortfall suggests research by Jupiter Research.

Instead some record labels are looking to new online models to reach new fans, enthuse old ones and boost profits.

One company that thinks it can help the industry redefine how to sell music is Tapulous, based in Palo Alto, California.

It develops applications for Apple's iPhone and its free game called Tap Tap Revenge has won over more than three million users since it launched in July.

The game, in which players tap and shake their devices to the beat of a tune, was one of the first iPhone games. It has also attracted a loyal following among musicians who have been lining up to have their music featured on it.

guitar hero screenshot
The Guitar Hero franchise is regarded as a cultural phenomenon

"To make the game addictive, it requires great technology and great features but it also requires great music," said Bart Decrem, chief executive of Tapulous.

Musicians making music for video games is nothing new with games like Guitar Hero and Rock Band making hundreds of millions of dollars for those involved. But Mr Decrem said importing that model to the iPhone or Google's Android platform has the same potential.

"We are offering people rich new ways to be part of the music and in doing so people are then much happier to pay for that music," he said. "We believe that is an important way to help the music industry to make it through this tough transition to the mobile world."

Premium game

A major boost for the company came when the band Nine Inch Nails approached it to create unique music to serve as the soundtrack that plays to the beat of the game.

The band's front man Trent Reznor is known as someone who likes to experiment with new distribution methods for his music and new ways of reaching his fans.

Bart Decrem of Tapulous
Bart Decrem said the iPhone means people engage with music in new ways

Like Radiohead, he put an album online and let fans pay what they thought it was worth to download and he has given an entire album away for free.

Fans who play the Nine Inch Nails version of Tap Tap Revenge can submit their scores and enter a contest to win floor tickets to a concert or even a Les Paul electric guitar signed by the singer.

Earlier in the year Mr Reznor said: "I don't agree that [music] should be free, but it is free, and you can either accept it or you can put your head in the sand."

The Nine Inch Nails premium game costs $4.99 (3.30) to download with an undisclosed chunk of the fee going to the band.

Jupiter Research analyst Sonal Ghandi said as gaming grows and people adapt to listening to music on their phones, this marriage of the two presents some interesting opportunities.

"For musicians it's a good thing because it diversifies the way they can make money while CD sales shrink. And its always a good thing when you are making money from more than one thing.

"The other added benefit, if artists are not getting too much in the way of licensing fees, is they are reaching an audience they may not have reached otherwise and that may eventually result in music sales," she told BBC News.

Trend setter

For Tapulous the partnership with Nine Inch Nails helped open other doors.

"Trent Reznor is really a trend setter in the industry and it's really helped us accelerate our partnerships," Mr Decrem told the BBC.

Weezer computer shot
Weezer has sold more than 15 million records worldwide

To that end the company have just released two new premium games. One is called Dance Dance Revenge and features music from the likes of Moby, Daft Punk, DJ Tiesto, and the Chemical Brothers.

Another game is called Xmas with Weezer with the band reworking classics such as Oh Holy Night, the First Noel and O Come All Ye Faithful.

"This is an important first for us because it marks the first time a top act is creating content exclusively for the iPhone for our game. It also marks a very important evolution of the iPhone as the next great platform for engaging with music," said Mr Decrem.

"We are building a large community of people who love music and who love games. And this partnership with our premium games means we do a revenue split with the musicians."

"Follow our heart"

Weezer knows only to well the benefits of such a partnership. When the band's song "My Name is Jonas" was included in Guitar Hero 3, there was a tenfold increase in sales.

"I would be lying to you if I said we didn't want to make money but at the same time we are always looking at different ways to include our fans and get our music out to people," said bassist Scott Shriner.

iPhone screenshot Weezer
The band took just seven days to record the festive favourites

He told the BBC: "As a band we just follow what is exciting to us and it just seems that when we follow our heart the money seems to come along. I love music, I love playing games on the iPhone and I think this is a genius device."

Mr Decrem said he thinks more bands will soon tap into what he sees as a burgeoning revenue model.

"The reason bands are excited to work with us is because we have over three million users and that's a lot. What you are also seeing is that some bands are selling more music and making more money like this than through traditional CD releases.

"That can only get bigger because everybody has a cell phone or iPhone and I think there is real potential for this channel to become really, really big over the next couple of years and that's why these guys are eager to do an experiment like this with us."

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