HitHive's deal with EMI: music via cell phones
(At the bottom there is mantion of Samsung being involved)
By Monica Soto
Seattle Times technology reporter
Business & Technology : Thursday, April 05, 2001
Copyright © 2001 The Seattle Times Company
In a week in which major recording labels and high-profile technology companies have engaged in noisy public displays of affection, a relatively obscure Seattle start-up has joined the fray, persuading EMI to share its music collection in a Napsterlike fashion via cell phones.
HitHive today is announcing a partnership with EMI to offer consumers a way to swap copyright-protected songs via cell phones by early summer - a service the recording label views as a marketing tool that could drive music sales.
"They (HitHive) were the first people to come up with a way to let friends share stuff, but with a business model included," said Ted Cohen, vice president of new media at EMI Recorded Music, which has artists including Lenny Kravitz, Tina Turner and Garth Brooks. "It's all the sexiness of Napster, but the artists and label get compensated."
Napster caught the music industry off guard with a service that allowed Internet users a way to swap digital music files without charge, a practice courts have found to violate copyright laws. The five major record labels have since rushed to come up with ways to offer digital music to customers, with the most significant deals this week.
Viacom's MTVi Group and Rioport.com yesterday said they plan to sell songs from all five major record labels over MTV's Web sites by the end of the month.
Under the deal, Radio MTV.com and VH1atWork Radio will offer 10,000 songs for download, with prices ranging from 99 cents to $1.99 for a single and $11.99 to $18.99 for an album.
Seattle-based RealNetworks also announced a partnership this week with three of the major record labels to create MusicNet, a subscription service that would let consumers purchase copyright-protected music online.
MusicNet plans to license its software to Internet portals, music sites and other companies. Time Warner, EMI and Bertelsmann, the German media conglomerate, are minority investors in the stand-alone company. Sony and Vivendi Universal, which were absent from the deal, recently formed their own subscription-based online venture, Duet.
Gartner analyst P.J. McNealy said the MTVi deal is the most significant because it offers consumers the ability to purchase individual songs. "That's a landmark announcement; a stunning announcement," McNealy said. "Pay-per-download gives consumers the ability to control music like they're used to, which is different from a subscription model, where you rent music."
Under HitHive's service, a consumer may invite 25 friends to be part of a song-sharing group. When users purchase EMI copyright-protected music, they may send it to other members of the group to play a limited number of times on PCs or wireless devices. The service, yet to be priced, includes other features, but it's only available through wireless-service providers that have contracted with HitHive. Right now, there's only one - Sprint PCS.
Sprint partnered with phone-maker Samsung and HitHive in November to offer the Samsung Uproar MP3 phone, which has the ability to play digital songs.
Bill Bassett, HitHive's vice president of marketing, said deals with other wireless carriers are in the works. The privately backed company has 40 employees in Seattle, San Francisco and New York.
McNealy said HitHive's deal may make more sense outside the U.S., where consumers are more accustomed to listening to music via cell phones. The company's audience is narrowed by the fact that most handheld computers can't play music yet, he said.
"When that happens, this could take off more," he said. "I'm not going to say it's going to be huge, but I think it will take off."
