Music Ally’s Stuart Dredge reports on this afternoon’s MidemNet Mobile apps session. Photo: moderator Steve Mayall (Music Ally), Nokia’s Adam Mirabella, Mobile Roadie’s Michael Schneider and MXP4’s Albin Serviant.
Mobile apps are huge this year – hugely hyped, but with impressive figures to back up their popularity with iPhone and other smartphone users. This afternoon saw a panel of experts from the mobile apps space, talking about what’s happening, the economics of apps, and how artists can make the most of them.
The figures are big: Tapulous has done more than 25 million downloads of its Tap Tap Revenge games, while Shazam has more than 50 million users – both companies had speakers on the panel.
The first question: can apps work for every artist, or just certain ones? Ted Mico from Interscope / Geffen / A&M said there’s a checklist to work through when deciding what kind of app would be appropriate. “I don’t think all artists should have apps, because I don’t think all artists should have anything…”
But he talked about Lady Gaga’s Kyte app – “Every week, the number of installs was doubling, so we could see her fanbase growing. But you have to have an artist as interesting as Lady Gaga for that to work.”
Mico said that apps can be used to build a fanbase, but that not every artist will be able to do it. “We want these apps to be commercially viable,” he explained. “One of the interesting things about apps is that the whole idea of apps works as a catalyst to move us from this product-based business to one that looks to leverage the things that we have into different arenas.”
Michael Schneider from Mobile Roadie was also on the panel – his company runs a DIY apps platform that artists (and events like MIDEM!) can use to create their apps. He talked about the “democratisation of apps” – letting emerging artists get in on the apps trend, using them to engage with their fans.
Nokia’s Adam Mirabella warned that the best apps come when the artist is genuinely engaged – and providing new content for the app. Mico agreed: the content also has to be “immediate and authentic – not some canned EPK [Electronic Press Kit] content… If you’re not prepared to do the work, you’re not going to get the results.”
What phones should you be on though? Shazam boss Andrew Fisher said his company has targeted every smartphone platform, not just iPhone. But that’s not a strategy that’s been much in evidence for artist apps so far, which have tended to target iPhone.
“To date we haven’t been motivated to move to another platform, but in 2010 we’re definitely looking to port,” said Tim O’Brien from Tapulous. He also said that the music industry shouldn’t just view apps as a way to market artists – they’re a way to make money too. Tap Tap Revenge 3 now has an in-game store that sells track downloads.
O’Brien explained that TTR3 has ten channels devoted to indie labels offering their music to players, and also the paid store. His job is to talk to artists, labels and publishers about licensing their music for use in the game.
Mico warned that “apps aren’t the panacea for all things”, but said he’s hoping for a seven-figure cheque from Tapulous by the end of 2010 – this may have been a joke, but the two companies are working together closely on a game called Riddim Ribbon that’s been six months in the making. It features the Black Eyed Peas and was conceived by Will.i.am, said Mico.
Albin Serviant from MXP4 chimed in at this point, saying that in the App Store Top 100 charts, there are only five music apps, including Shazam, Tap Tap Revenge and Pandora. What’s missing? Schneider thought it didn’t matter – apps can be successful without cracking the Top 100 chart.
“You’re comparing yourself to currency converters!” said Mico. “It’s not relevant. What matters is if we can get a commercial return from these things.”
However, moderator Steve Mayall from Music Ally asked if there isn’t a problem here – is there a long tail in apps that make money? Mico thought so. “Great apps are like babies – very easy to conceive but very hard to deliver! We’re at the very beginnings of this, and figuring out what we can do… We haven’t even begun to look at what’s possible, so it’s too early to say ‘oh, music apps aren’t going to sell well’.”
O’Brien said Tap Tap Revenge has got much more social over its lifetime, adding chat rooms, challenges and other features – “we’ve really set out to make it a social game, and I think we’ve succeeded,” he said.
What about piracy and apps? There was an article last month claiming that the cost of iPhone app piracy has been $450 million, and that there are three illegal downloads for every one legal download. Is that a big problem going forward?
Mico said in-app commerce could be one way to nullify the piracy effect – giving apps away for free and then building loyalty, so that users pay for additional levels or content. Meanwhile, Mirabella said there’s huge potential for growth among the hundreds of millions (and, indeed, billions) of people who haven’t got into mobile apps yet.
“The onus is on the industry to educate and not spook people that they’re giving away their intellectual property,” said Fisher, admitting that Shazam has seen piracy of its premium mobile apps on every platform.
“I don’t even know if piracy is a problem,” said Schneider. “The majority of our artists monetise apps by selling music, tickets or merch.” So it’s not piracy, it’s marketing? “Exactly! It’s good piracy…”
In its first two months on sale, Tap Tap Revenge 3 was downloaded 2.5 million times, of which one million were illegal downloads, according to O’Brien. However, Tapulous started running ads to the pirated versions – it can target them – and O’Brien said some of those people have started paying for content in-game. They’re now paying customers, not pirates.
Jumping back to artist apps, Mico warned that some artists aren’t really into apps – they want to keep a sense of mystique. “But the artists who are willing to do that are going to prosper,” he said, pointing out that apps aren’t just a mobile thing – “They can exist on PCs, TVs… At the moment, the evidence is stacking up in favour of doing the extra work.”
Schneider disagreed that it’s a lot of work for bands to keep their apps maintained. Artists using Mobile Roadie’s platform can post a photo after gigs with a message saying ‘thanks for coming to the show!’ for example – something that’s hugely popular. “I’d say it’s less work than having a website,” he said.
Mico said that most of the artists on Interscope’s roster are young enough that they’ve grown up with the various technologies that are being used for music marketing – blogs, Twitter, social networks and so on. They just do it, rather than seeing it as an onerous list of tasks.
Are apps still an Apple-dominated thing? Mico says some Interscope artists have specifically wanted to work with Nokia, because they’re targeting markets like India or Latin America, where iPhone isn’t as big.
Schneider talked about Android, which he thinks is going to be an important platform for apps in 2010 – it already has 25,000. But what should the priorities be for an artist? Mico said it’s about what’s easiest to develop on, and where are you going to get the most audience? “Right now, iPhone and Android are the place to be in terms of reach and audience,” replied Schneider.
Mayall moved the conversation onto business models. Serviant said that personalisation could be the key – apps that let people remix tracks and share them with friends – something that MXP4’s technology does.
“I don’t know why you would sell an app nowadays, now there’s in-app purchases,” said Schneider, taking a different tack. “There’s a lot of ways to monetise and have the base product be free.”
O’Brien talked about the conversations he had with labels, who wanted to sell tracks for a dollar within Tap Tap Revenge 3 – “at a time when there are apps that cost half a million dollars to make that were selling for 99 cents”.
Mirabella suggested that the global nature of apps means good ideas can come from anywhere – developers working in one part of the world may come up with an innovative business model for an app, and see it spread fast – faster than previous mobile technologies like ri
ngback tones were able to.
Mico suggested that Dr Dre may be up to something involving augmented reality and remixing at this point, intriguingly.
What about mobile web? Will we be doing this kind of stuff through mobile browsers in the future? Schneider said yes, but that there will always be differences between native apps and mobile websites – artists are likely to have both.
Shazam was asked for more figures – Fisher said Shazam is selling around 300,000 tracks a day through its apps, and that the company is “making profits… and driving really good revenues for everybody.”
A question from the audience focused on how to make your app rise to the surface – does the artist promote the app, or the label? How do artists reach the fans when nobody knows who the artist is? Mirabella said there’s a partnership between someone like Nokia and its Ovi Store, and the label.
The panel also talked about the costs of making an app. Mobile Roadie charges $500 for a basic app, but says for richer games, the budget can climb to $5,000, $10,000 or even $50,000 – while premium iPhone games can easily cost $500,000 to develop.
Serviant concluded by saying apps could be a way to rethink the music experience, while Schneider talked about the potential importance of real-time – fans watching concerts while chatting to each other, for example.
The panel concluded with the participants talking about their favourite apps. O’Brien said Shazam, while Fisher cited an augmented reality app that overlays points of interest on the camera feed. Mico agreed, saying he loves augmented reality as a technology. Mirabella chose Nokia’s own Rihanna application, and also Carnival Comics. And that was a wrap.