Co-Founders Jeff Price and Peter Wells Gone from Tunecore
August 16, 2012 by David Weiss
One of New York City’s most prominent music business disruptors has suddenly had his own career disrupted: Jeff Price, Tunecore’s CEO/President, announced that he is no longer with the company that he co-founded along with Peter Wells and Gary Burke in 2006. Wells has also left the company.
Major changes are taking place at Tunecore.
Price, an outspoken and highly engaging advocate for artist’s rights, was reportedly ousted from his post as Tunecore’s president and CEO back on July 20th. In an open letter that he published online yesterday, Price points out that he and his co-founders grew the company to employ over 40 people in Brooklyn and Burbank, CA. In addition, he says that Tunecore artists now have come to represent over 4% of all U.S. gross digital music sales revenue, with sales of 610,000,000+ units of music representing more than $310,000,000 in gross music sales.
Still, the speculation is that Tunecore’s board took action out of concern for the company’s balance sheet. Friction with Amazon that saw the company’s songs temporarily taken off their UK Website earlier this year could also have been one of many factors.
Billboard.biz notes that Wells told them in an email interview, “Now that Jeff’s terminated, I’m seeing things in a new light, and I’m deeply concerned.”
It’s part of a twisting path for a company that, when launched, seemed as if it would have a bulletproof business model for the rest of the 21st Century. To many independent entities (this author included), Tunecore’s ability to give artists and labels direct access to sales on iTunes and a number of other digital stores, for a flat fee, was nothing less than a revelation.
For scores of musicmakers, the question of how to gain access to that distribution outlet had been a puzzling mystery. But Tunecore, which grew as much from word of mouth as any sophisticated marketing scheme, solved that problem in a flash for legions of artists – from the indie folksinger who sold one single to her mom, to #1 chart leaders like Drake and Nine Inch Nails.
However, as we’ve all seen in the Internet world, nothing is forever, and an infallible business plan can have a faster half-life than anybody expected. Tunecore’s ability to pull in hundreds of millions of dollars for its customers was smart, but access to digital stores is no longer as essential as it was back in the good ole days of 2006.
With the advent of legal free streaming services like Spotify and Rdio, and their growing popularity in worldwide and US markets, having music available for sale on iTunes has stopped being essential. Loyal fans now can – and will – check out your music free of charge on Spotify, taking comfort in the fact that the artist is soaking up a (microscopic) royalty in return for their patronage.
Shortly after the appearance of Spotify in the U.S., more than one Web-savvy artist told SonicScoop that they were dropping iTunes sales from their business mix, as their digital transaction volume took an immediate and noticeable hit.
Doubtless, their TuneCore accounts were allowed to expire in tandem. It would be interesting to know what TuneCore’s membership numbers have been like since Spotify’s official US launch on July 14, 2011. We’d wager that they are trending down.
While Price oversaw the introduction of alternative business models, such as its Global Publishing Administration service in late 2011, these initiatives were apparently not enough to convince the company’s board of his ongoing relevancy or benefit to Tunecore.
As bold as their visionary inventors may be, the fact is that pioneering firms can – and often do – outgrow their founders. But another possibility is that Price, along with his colleague Peter Wells, has outgrown Tunecore. So which is it? For anyone who has seen Jeff Price in action, watching what comes next is a very intriguing proposition.
– David Weiss