Photo: Flickr/Kevin Krejci
Super angel investor Ron Conway thinks that digital music is still in its infancy — more than a decade after he lost money on an early investment in Napster.Speaking at Billboard’s FutureSound conference in San Francisco this afternoon, Conway explained that he sees huge potential for startups to build on the music platforms established by Apple, Google, Amazon, Pandora, and Spotify.
“Consumers love all those brand names,” Conway said. “Now there will be a wave of apps developed on top of these platforms so consumers can discover and curate music in their interest area.”
“Remember when the iPhone came out, people said there might be 50 apps for iPhone. Now there are hundreds of thousands. I think there will be an equal number of apps built on these music platforms from Apple, Google, Amazon, Spotify, and Pandora.” (He was very consistent in talking about those five companies, not others.)
He also said that Google’s entry into the market yesterday was a big validation of all the interest in digital music recently. “Success breeds success….There’s a lot of optimism that you can build billion-dollar industries by selling music digitally only.”
Startups should allow major labels to take equity stakes in exchange for licensing their content, he argued, as that’s the best way to make sure that labels and startups have the same interests He deemed 2% as an appropriate amount, which met with applause from the crowd of music startups. — that’s a lot less than some labels have been asking.