Hard News by Russell Brown


Baboom: it's serious

Baboom, the music service first trailered by Kim Dotcom in 2011 but now no longer associated with the controversial German, launched overnight. Its investors and management are in New Zealand. And it's really not bad.

The design of both Baboom's web and mobile apps (by an in-house team in Portugal) is simple and effective, and while it shares some visual elements with Apple Music (tiling, the ellipsis contextual menu), it's not going to to mess with either your head or your existing library.

Baboom's industry-first FLAC lossless streaming sounds really good to me – noticeably better than Apple Music in a side-by-side – although I'm experiencing a bit of buffering in starting (and even restarting) tracks. (You can set the streaming rate via the "HD" button in the player panel at the bottom of the screen in the desktop version – I couldn't fnd the equivalent in the mobile app . I thought even the non-FLAC HD option sounded good.)

But the most interesting thing about Baboom is the way it addresses some of the problems with the streaming market we've discussed here in recent weeks. Its "fair trade streaming" model works in a fundamentally different way to Spotify et al. If you're a subscriber (or "Premium" user), your $AUD10 monthly does not go into a general pot for redistribution, but is allocated directly at the top of the process – so if the only artist you stream in a month is The Phoenix Foundation, all your money goes to The Phoenix Foundation.

Its notable that Baboom has negotiated an agreement with APRA/AMCOS on the same principle. The artist back end also handles publishing arrangements well.

How much is in it for the artists? At the low end, nothing for streaming by Standard (ie: free) users, who are limited to a streamable collection of 100 tracks at any one time. Free users can add to their collections by buying tracks on the site or uploadng their own.

Baboom's commission depends on whether an artist is "Standard" or "Pro", with the latter requiring a monthly fee of $AUD10. Baboom takes a 30% commission from standard artists and a 10% commssion from Pro artists. The other deductions are a 5.1% transaction fee and 9% mechnical royalty (which may or may not go to the artist, depending on who controls the copyright). So from a $10 purchase, a standard artist will pocket $5.59 (or $6.49 if mechnical royalties are included) and a Pro artist $7.59 or $8.49. These are pretty good numbers.

The split for streaming is similar, although 9.5% of subscription income is split off into a "Premium Following Poll" – that is, the artists who are followed on the site by paying fans – and distributed pro rata from there (so you can direct money to your favourite artists simply by following them on the site).

Artists and their labels can elect not to make their works available for standard streaming, and choose a Preview option instead.

Payments are made at the end of each month for streaming and as soon as 24 hours after a purchase. Artists are paid via PayPal and so must have a PayPal account to receive payments.

Other benefits for Pro artists include some quite nice back-end analytics, adding to the air of transparency. There's also a facility for ticket sales.

Last night's launch is less a commercial launch than a call for content and realistically that will be content from independent artists (the major record companies are very unlikely to like the look of "fair trade streaming" for the time being), which makes Baboom much more like Bandcamp than Apple Music or Spotify. Like Bandcamp, Baboom offers music for sale in lossless format, but I think it could take a leaf from Bandcamp's book and add ALAC (Apple Lossless) as a format – I don't want to have to convert everything from FLAC just to play it in iTunes.

So what are these people? Baboom's Head of Content and Platform Mikee Tucker works out of the two-person office shared with his Loop Recordings label upstairs at Real Groovy Records in Auckland. Ninety per cent of Baboom shares are currently held by Mega investor Michael Sorenson, after an unsuccessful share offering on the Australian exchange last year. Baboom's CEO is Grant Edmundson and its CFO is music industry veteran Tony Smith.

Baboom is entering a brutally tough market and it will need to add catalogue to make its monthly subscription seem worthwhile to consumers. But its innovations warrant attention. Its job now is to convince the independent music sector – and maybe even the indie big beast Beggars Group – that its model is worth a trial.

For now, having Dotcom's name mentioned around the launch is a mixed blessing. On one hand, it's been good for press: Fortune, Music Week and Variety all have stories on the launch today. On the other, it will be keen to move on from the Dotcom association and make its case as a real contender. On the evidence of day one, it has made a good start on that.

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