Ultra To Exit eMusic
Ultra will sever relations with eMusic due to modification to their payment schedule to record labels. The departure follows Victory Records, which left recently over the same issue. Several other labels in the eMusic family are rumored to be bailing as well.
Further action inside the online retailers reveals that the labels may have something to gripe about. Ray Farrell, part of the original “cuddly” label development crew, has left the concern to work at Royalty Share.
The Future: Now that eMusic has matured with a substantial subcriber base, they feel that it’s time to start pressing the accelerator so they can maintain their number 2 spot in the music download business. The change in payouts will cause them some growing pains with a few of their longtime, fiercely independent, and politically-minded labels, but in the end they need revenue… (unlike Apple, who can use iTunes as a loss-leader for their digital music players) The eMusic blog recently had a post from CEO David Pakman who warned something to the effect of “it’s a brave new world out there — one we had better all adapt to, or the music industry decline will just continue.”
