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Post by EmpireOfOne on Jun 19, 2007 17:31:07 GMT
I don't want to post this in the new forum until I think about it a bit, and hopefully get some feed back here in this smaller arena. These were my thoughts about the newly released details:
I would also like to give Johan a chance to say wether or not the 'back end' agreement has changed at all or is that still 60/30/10?
The 'original' design for sellaband had the downloads being free, with cd sales being the primary driver for revenue to artists and believers. SAB was to derive the majority of their profit off of the back end 30%.
But further calculations proved that this would be a risky model for sellaband, so the terms were changed inserting sellaband at the front end as well. Now SAB doesn't bleed money from free downloands, and in fact turns a small profit per download. I can see where this was a good move business wise for sellaband, but it seems they might have lowered their risk at our (the believers) expense.
You see after 12 months the believers are out of the equation completely. We have 12 months, no more, to get a return on our investment. Sellaband, on the other hand has 30% publishing return for years to come. For sellaband to insert itself more at the front end without letting believers share in the long term return seems odd to me.
Since the believers (the ones suppling the 50k budgets) are the only ones here who get removed after a period of time, I feel that every penny counts. I have no problem with sab covering the costs of the downloads, but to take a profit without sharing in the back end revenue seems like a significant change in the terms at this late stage in the process. And that concerns me...how do I know the terms won't change again at my expense only after I've purchase my parts?
Any thoughts?
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Post by EmpireOfOne on Jun 19, 2007 17:50:32 GMT
I also found it a bit disturbing that one has to become a believer in order to purchase the downloads. This may turn off a lot of potential customers. I can only hope that the downloads are also available via the standard music sales sites. As much as I want everyone who visits to become a believer, I think they should be able to experience and purchase the music first without joining.
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Post by magnusbe on Jun 19, 2007 18:06:51 GMT
I guess if you could earn a commission buy downloading a song without registering an account, some people would misuse that.
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Post by EmpireOfOne on Jun 19, 2007 18:29:03 GMT
I guess if you could earn a commission buy downloading a song without registering an account, some people would misuse that. Since the commision is only on sales and not free downloads I don't think that will be a big problem. Limiting the free samples to 1 per song per person seems to be the main reason for it. Potential customers should be able to get samples and make purchases without feeling pressured to join. While they still have to input personal information to buy, there is a huge mental difference between these statements: Buy music downloads for 50 cents. and Join now to buy downloads for 50 cents. For sab to be a popular download destination we want it to be as easy to use as possible without pushing people to join. The change in terms bothers me a bit more than this, but it is still something to be concerned about.
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Post by magnusbe on Jun 19, 2007 18:52:14 GMT
We're still getting paid according to the market share of the free downloads, right? So even if that will be quite miniscule, one can think someone will game it.
I agree, it should be as easy as possible.
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johanv
Slightly Sellaband addicted
The Boss
Posts: 153
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Post by johanv on Jun 19, 2007 19:02:09 GMT
Hi Empire,
Yes I still read this forum too (I'm a bit of a control freak, that's why, I guess). I'm a bit confused as to where your disappointment comes from (although I'm not questioning it) as I was under the impression that tonight's Tribune is no different from my answer to your previous download-thread here on June 14, as well as what I eluded on when we discussed the whole issue with Charlie from Trail at Kettner's in London. One thing is for sure: We will bleed money on those free downloads, no matter what. Perhaps if you want this could be the one flaw in the concept that I didn't see when we started this company 12 months ago. In 2011, perhaps yes. Once we have more than a million freeloaders generating traffic for advertising, and big brands sponsoring the free downloads, yes, but until then, there is just no other way. And magnusbe is right. The only way to avoid potential abuse is to have people register with SellaBand. But, like I say in the Tribune, there is no other commitment than to just leave your e-mail. That way we can recognize you, if you want to download a song more than once. You are right though, I find it annoying too that you have to register as a Believer first before you can download anything. The programmers simply tell us there is no way around this, for security reasons.You can listen to the free, quality tracks though, without registering. We will get into this and see how we can make it as friendly as possible. Now, about the earnings. Making guaranteed extra money on your LE CD's, getting a commission if you sell stuff through your own store, are also all new features that weren't in the original plan. And the partnership doesn't have to stop after twelve months. If WE (that means you, the Believer, and us SellaBand), keep the artist happy, I see no reason why they would not stick around longer. The only thing we say is that an artist has the right to withdraw after twelve months. Some of them have already asked us if they can return for the next round, so the signs are all there. Finally, about SellaBand's potential increase of income. Any sightings of significant publishing income are very far away. Again, things are different then they seemed twelve months ago. Back then we never thought of being part of Concert At Sea, closing distribution deals for album sales, recording quality live-shows to promote our bands, or me personally visiting every band that would reach the 50K. These things cost money, time and energy and at the end of the day, bills will have to be paid. Really, it's as simple as that...
PS You are more then welcome to voice your criticism on our Forum too, we won't shut you down...
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Post by EmpireOfOne on Jun 19, 2007 19:37:21 GMT
I wasn't concerned with being shut down, I just didn't want to express something to the masses without having thought it through and gotten some input. I posted here more to protect you than to protect myself. In my last thread you will see that I left it with an open question regarding how precisely the download revenue would be split. I wasn't going to hold you to exactly what you said when Charlie asked because it was late and there were drinks flowing, so one can never be sure My disappointment stems from one main aspect. The original model had SAB bleeding on 10 free downloads (or whatever number the cd had) rather than 3. I'm not saying wether this was a good model or a bad model, but it was what you presented us with. Under the new model sellaband bleeds much less. In fact if purchased downloads do well SAB could make a small profit on what would have previously been a major loss. Good for Sellaband. However, if sellaband can, with one move, cut it's risks and increase its rewards, I have to ask where the other side of the coin is? All of that gain comes from SAB moving into the territory previously reserved for artists and believers: music sales. Again it may be that sellaband *should* be involved in the front end of things, but my point is that it is different than the model originally presented. Previously SAB was going to make all profits on the back end. I have no problem with a percentage of sales going to cover the costs of downloads. I have no problem with some percentage going to commission. But if sellaband is going to move into taking a profit on the front end (and thus reducing its risk) then shouldn't sellaband share a percentage of the backend with the believers? If we're all sharing more fairly on the front end, then why cut the believers out of the backend too? That is why I bring up the 12 month time limit. Now if that is too complicated to be done reasonably I can understand. As an alternative I would accept that the 5 cents/download currently reserved for SAB were allocated for marketing that particular artist. I'm not arguing this out of greed, just from where I'm sitting it seems SAB has cut itself a slightly larger piece of the pie by re-writing the rules. Don't get me wrong, I love a lot of the things that are going on. But if each time sellaband doesn't come up with enough profit from it's model, how do I know it won't re-write the rules again and cut my involvment down a bit more?
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Post by EmpireOfOne on Jun 19, 2007 19:55:46 GMT
Actually, thinking a bit more, I would love to see believers on the back end. Even if, as you say, any profits from that side are "very far away".
Why? Because it leaves a long term relationship with those artists and their believers. Even if we aren't listed specifically by name in the publishing contracts, just the promise of SAB to distribute 10% amongst the believers in that artist would be nice. So why not make it 60/20/10/10? It doesn't hurt you in the short term, you've already lowered your risks by adding SAB to the front end, and it creates a long term commitment to the fans for taking a chance on this crazy idea.
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Post by wyando on Jun 19, 2007 20:58:37 GMT
Quite interesting stuff in here - never thought that far. But then again, didn't put that much money into it too.
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Post by EmpireOfOne on Jun 19, 2007 20:59:14 GMT
Also don't think I've missed out on the significance of adding the commission. We now have an entirely new class of believer. One who doesn't even need to buy parts. They simply sign up, and promote the *$#) out of the completed artists to start getting a profit.
I used to play on online star wars game. In the game we had what were called 'credit farmers'. People in China getting paid $1/day to play the game in order to earn in-game money. That fake money was then sold by their bosses to American players that had real world $ and wanted more in-game cash.
Now if those same cheap labor nations find out they can promote cds and song downloads for a commission, I wouldn't be surprised if we end up with a class of 'download farmers' here on the site. It will be interesting to see.
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Post by Lucretia on Jun 19, 2007 21:48:03 GMT
I'm going to pop in on this thread and hope Johan will correct me if I'm saying something wrong here. For all I know, things may have changed since the conversation I had with him at the Second Person gig in March. ;D
As I understand it, what Johan told me (but what I haven't seen made 100% clear although it does say in the Tribune - "After the online listening sessions all Believers with parts in Cubworld and/or Nemesea can open their own store on their profile page!" ), is that you can only earn commission from artists you actually believe in. So I can't get anything from cubworld or Maitreya purely because I have no parts in either of those artists. This would prevent someone from signing up to the site tomorrow and doing what you describe, because they will have no parts in the artists that have already gone through. Thus the existing believers are protected. It's existing small believers that the existing large believers in an artist need to be worrying about - if you're planning on selling most of your Clemence CDs through SAB for instance, then someone like me with only the 1 part has a good chance of picking up quite a few of those 50c commissions for selling CDs.
And of course this has the potential to change the investment behaviour for the future - will we see believers as large as those we have now in future, because they realise their profits can be nibbled by the small ones - i.e. will we start moving back towards the original "5000 believers, 1 part each" original model or will we see some of the larger investors taking more CDs out of the equation and selling them on separately later?
I can see why the signup for security might be needed (though I don't like it either), but if I could make a small suggestion at this late stage, I would actually suggest calling the downloaders something other than believers. Sure they'll need the same facilities to deposit money etc. as believers do, but how about giving them a different name and only "upgrading" them into the title "believer" if they subsequently get hooked and go on to buy parts in artists?
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Post by EmpireOfOne on Jun 19, 2007 22:16:29 GMT
You misunderstand me Lucretia...I don't worry at all about those 1 part or even 0 part sellers. Let them sell sell sell. For all their work I'll make more than they will (per hour of work) :-) and it'll spread the word that much faster.
Although I don't think that will stop me from printing up some flyers for my own referential download portal.
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funfile
Sellaband addict in waiting
Posts: 82
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Post by funfile on Jun 20, 2007 5:02:21 GMT
I can see why the signup for security might be needed (though I don't like it either), but if I could make a small suggestion at this late stage, I would actually suggest calling the downloaders something other than believers. Sure they'll need the same facilities to deposit money etc. as believers do, but how about giving them a different name and only "upgrading" them into the title "believer" if they subsequently get hooked and go on to buy parts in artists? Good suggestion. Let's have them sign up as 'Friends' or 'Fans' instead. Did I read they have to buy credits in stacks of 10 $ ? Or was it just a suggestion to save on creditcard fees ?
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storm
Sellaband addict in waiting
Posts: 64
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Post by storm on Jun 20, 2007 6:43:56 GMT
- Yeah, 'Friends' of Sellaband is a better title, if they have to sign up. Automatically change it to 'Believer' once they invest in a new artist.
- so the 50/50 split of regular cd sales profits is gone? it's now 1/3 each?
The greedy part of me is against, but the logical part of me is happy that SAB will now do whatever they can to facilitate album sales (especially offline)... got a distribution deal in Australia yet? What about marketing costs? Need to let people know it is in the store. I wonder how much the retailers will sell them for?
- I think it would be a great idea to let the believers share 10% of the publishing for life. Makes ALOT of sense.
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storm
Sellaband addict in waiting
Posts: 64
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Post by storm on Jun 20, 2007 6:45:12 GMT
Oh, and change the terms to artists have to stay around for 12 months after the cd is released, but can stay as long as they want after that, so everyone shares in more good fortune.
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