Players will pay using Facebook Credits to play games including tracks from Lily Allen, Gorillaz, David Guetta and other artists
EMI has become the first major label to sign a partnership to sell music within a social game on Facebook using the social network’s Facebook Credits virtual currency.
The major label has agreed a deal with social games publisher MXP4 to make a range of tracks from artists including Lily Allen, Gorillaz, the Jackson 5 and David Guetta available within MXP4’sBopler Games collection on Facebook.
Fans will be able to play a selection of rhythm games for free with 60-second clips of the songs, but will have to pay using Facebook Credits for access to the full songs. MXP4 struck separate deals with EMI’s recorded music and publishing divisions.
“Games are a high-growth digital business, so we are always on the lookout for ways to license our music or have our artists involved in that area,” says Cosmo Lush, EMI’s vice president of digital business development.
“We are talking to lots of different potential partners across the games business, but MXP4 were very forward-looking and keen to move quickly to get some of our music licensed and get going.”
“This is the first time a music label and publisher have signed such a deal using the freemium business model,” says Albin Serviant, MXP4’s chief executive. “We expect more signatures from other publishers and labels by the end of August for the commercial launch of Bopler Games.”
The games are currently in beta, with new EMI tracks being added every week. By August, there will be 12 games to play, with social features including challenges and tournaments wrapped around them.
“We have hundreds of tracks cleared from the label, and more over time as we see how well the service is performing,” says Lush. “This is about looking for innovative new digital frontiers where music can be monetised in a way that is compelling and appealing to consumers.”
This is not the first crossover between music and social games. Lady Gaga’s latest album was promoted in Zynga’s FarmVille game earlier in 2011 with her own virtual farm, GagaVille.
Meanwhile, US publisher Booyah’sNightclub City game has run promotions for Kiss, Keith Urban and Daft Punk’s soundtrack for the film TRON: Legacy. EMI and MXP4 have worked together before, too, on a promotional Facebook game for David Guetta.
What is innovative about the new partnership is the use of Facebook Credits to pay for access to songs by EMI artists within MXP4’s Bopler-branded games, providing a direct revenue stream for the music group.
Facebook takes a 30% cut of all Facebook Credits transactions, but Serviant declined to say how the remaining 70% will be divided between MXP4, labels and publishers. He stresses that the deal does not involve selling music downloads, however.
“This is not a service where you use Facebook Credits to purchase music,” he says. “What we are monetising here is the gaming experience including the music. It’s not about selling music as virtual goods: it’s about selling music games as virtual goods.”
The deal is a welcome positive note for EMI after a troubled last year when control of the music group passed from private investment firm Terra Firma to bank Citigroup, after the former failed to meet the covenants of loans taken out to buy EMI in 2007.
According to music industry body the IFPI, trade revenue from recorded music sales was $15.9bn in 2010, down 8.4% year-on-year. By contrast, social games are still relatively small fry: eMarketer estimates that social games revenues in 2010 totalled $856m.
Even so, music rightsholders are intrigued by the success of social games publishers like Zynga, which generated $598 million of revenues in 2010 alone, with $575 million of those coming from virtual item sales.
Facebook is mulling its own move into music, too. In August, the social network is expected to announce partnerships with streaming music services including Spotify, Rhapsody and Rdio that will integrate them more deeply into Facebook. It is unclear at this point whether Facebook Credits will have a role to play in those partnerships.
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