Update: Sameer Nigam has clarified that the company works on a pure revenue-share basis with content owners, and licenses out the encryption technology to web
publishers, cloud service providers and CDNs for $10,000 per platform (PC, iOS, Blackberry, Android etc).
Mime360, a digital content platform startup, is trying to change the way that digital music is distributed in India, by offering more control to content owners, and reducing time to market for publishers and content aggregators. The company ties up with content owners to host their digitized content, and then offers APIs to publishers and content aggregators for integrating with their business. Mime360’s approach points towards a potential change in content distribution: from a publisher-side distribution model, to a content-owner side distribution model.
This is significant, since it gives content owners control over their inventory, and more importantly, offers them transparency in terms of reporting, which has forever been a cause for complaint for content owners. Mime360 has tied up with Saregama and Universal Music to host content, and has provided content to publishers like Gaana.com (Indiatimes), Myusic and iMusti. Mime360 Founder and CEO Sameer Nigam told MediaNama that they’ve also signed up with Mukta Arts for distributing video.
Nigam says that the business owes its origins to the struggles the company faced with an attempt at a consumer music play with Manoramic.com. “We took a stab at trying to license, and found that music companies were traditionally vary of technology plays, and there were all sorts of obstacles to easy licensing,” Nigam said. They faced challenges which Mime360 is trying to address:
– Transparency in reporting: “This lends itself to this minimum guarantee model,” according to Nigam, saying that because publishers don’t trust reporting, they tend to put a minimum guarantee clause. Mime360 gives the content owner detailed logs of transactions, along with analytics. “They get territory information, on total volume of streams and downloads by publisher, by language, genre,” Nigam says. The genre bit is interesting: Nigam says he’s heard of licensees (who have licensed a genre) buying music off the shelves, and then there being disagreements with publishers whether a particular song or album belongs to that genre. In this case, the publisher defines the genre.
– Getting Content in a usable format: “From a publisher standpoint, we had an issue getting a large repository of content, because of there are 400 labels, and you have to choose between them. Some people ship hard disks, CDs, and other forms. And there is time sensitivity. Time to market is key in music, and we were struggling because we didn’t have a digital connect in pushing content.”
Saregama’s music launch with Gaana.com (our review here), according to Nigam, didn’t require any shipping of content: “We provide meta data and artwork formatted, through simple API, and they can build out applications. It streams off our CDN, and it streams encrypted.” The company also offers downloads, Nigam says. Transparency in reporting has been a common complaint among mobile value added services as well, and the company offers streaming over EDGE and 3G as well.
– Security: “Even with content even on legitimate sites, you can download content illegally using simple plugins on browsers. Ripping is going to become more profound. We have a provisional patent on a encrypted media streaming over HTTP. This is relevant in developing markets, where you don’t want to stream over RTMP, where connections remain open. We’ve also developed thin encryption APIs that runs with devices, Android, Symbian, iOs.”
– Cost of content: The other situation that Nigam points towards, is that the B2C market becomes unviable because startups require vast funds to get access to music: “The b2c was becoming unviable without venture backing, and venture capitalists were unwilling to participate because of a chicken and egg situation, that they won’t fund licenses for startups.”
“It took us 18 months to aggregate songs, but when gaana.com launched, they just needed 30 days, because of our API. It changes the game from both sides – content owners can now focus on marketing, and don’t have to focus on packaging, and from a publisher standpoint, if you’re a startup on a shoestring budget, you don’t have any significant storage costs. It allows small players to play on the same strength as large players, and we give labels real time reporting across publishers. Myusic.com is a 3 person team in New York that launched a site, against much more reasonable guarantees, through our APIs,” Nigam says.
But what about standardized rate cards for licensing of content? Nigam says that they’ve spoken to labels about it:”It’s a model that has worked for BMI, where they have standard rate cards. In India, there are only 15-20 legal licensees on the web, and maximum 50 in total. That’s so far from reality, in terms of the music on offer online. We’ve told them that they can go granular and slice and dice it. Corporates might want to do microsites with 30-40 songs only.”
Mime360 hasn’t acquired licensing rights, and Nigam says that he doesn’t want to set the price, but the company essentially monetized by offering the solutions to content owners –
the API costs $10,000 per year for each new licensing platform, it also charges for streaming from its CDN, and it also licenses out its encryption technology to data centers.
Correction: we’d incorrectly mentioned that the platform gives publishers control over their inventory, instead of content owners. Has been corrected. Thanks for pointing it out Aditya.