We7, the Peter Gabriel-backed music site that offers free tracks by grafting audio ads to the start of songs, has got a license from EMI Music – but not for what was once the core part of the service. Instead, the 400,000 EMI songs – including those from its famous investor – can be used for on-demand, standard ad-funded web streaming and paid-for MP3 downloads.
Though its launch in 2007 was predicated on the audio ads idea (CEO Steve Purdham told me at Midem some labels have an “aversion” to the technique, although commercial radio has married songs with ads for decades), We7 has only managed to secure buy-in for that from some indies and has since diversified in to other models. In March, the service got agreement from SonyBMG on ad-supported web-streaming and Warner followed suit last month for streaming and paid-for MP3s, suggesting the labels are wary of the returns that can be gained from embedded audio ads.
Purdham told paidContent:UK today: “Ad-funded downloads have had to take a slightly rear seat, the main reason is the economics between industry expectations and what the ad world is prepared to pay meas that the gap is still too wide.
“The music world has moved very positively in the last six months in embracing new ideas but there are more changes to happen before ad-funded downloading really kicks in. So ad-funded streaming is the order of the day for now.” Release.
Check out We7′s ad-supported album widget after the jump … and be sure to join us for a discussion of ad-supported music and other industry issues at our EconMusic conference in London on Sept 23.