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EVEARA: Testing a New Business Model for Digital Music Distribution

Periodic Reporting for period 1 - EVEARA (EVEARA: Testing a New Business Model for Digital Music Distribution)

Reporting period: 2016-08-01 to 2017-01-31

1.1. Context:

For the first time, digital music surpassed physical music sales in the first quarter of 2016. This booming industry is growing quickest in Europe, at 14% annually. Europeans want to download and stream music, especially European music. More and more demand side services (Apple, Deezer, Spotify, etc.) are popping up as a result – now more than a billion tunes are streamed/downloaded from 500+ services. Each service has its own specific, extensive, and often complicated requirements for how music is ingested into it, however, eliminating over 90% as viable outlets for artists and rights holders (SMEs) trying to make a living from their music.

EVEARA is the missing link for those SMEs to access all relevant digital distribution channels and reach markets and listeners, exponentially increasing their revenues and creating new white label businesses throughout Europe. By serving multi-channels (artists, SME producers/labels and other copyright holders, and large enterprises), EVEARA is not only simplifying digital distribution to a degree that has never been done before, but also creating a revolutionary business model that will take 1.6% of the market share.

EVEARA empowers SMEs to distribute in one step. No other service in the world offers the ease and benefits of EVEARA, designed particularly for Europeans by European music professionals, nor approaches the problem from a top down business model. B2B partnerships with music distributors, telecoms, etc. are providing a base of immediate revenues and hundreds of thousands of artists and rights holders. The results of this study is now helping us serve those European clients better by testing a launch strategy to them and redesigning software and sales elements accordingly based on their feedback. The sales strategy will be revised accordingly for global expansion, resulting in European music being shared at new levels across the world, and EU SMEs taking advantage of one of the fastest growing global industries.

1.2. Overall Objectives:

To position EVEARA as one of the leading digital music distributors within 3 years.

1.3. Conclusions of the Action:

The conclusions of this Phase 1 project are that EVEARA now have gained strong evidence that they can successfully develop the easiest to use fully do-it-yourself digital music distribution solution on the market. At the same time, they will be able to offer comprehensive functionality, and a large distribution network, covering all relevant digital music retailers.

All of this will be directly marketed to semi-professionals and professionals via EVEARA’s own website, and using its own marketing efforts.

At the same time, they can capitalise fully being the only 100% WHITE LABEL solution on the market which allows EVEARA to start creating the world’s largest digital music distribution network, using already well established brands, their existing customer base and marketing power in their specific segments and regions.

They can also flank the above mentioned approaches with creative and efficient B2B (Business to Business) and B2C (Business to Customer) marketing activities.
In brief, all tasks that were planned have been carried out to our satisfaction and the results strongly support our belief that the market and the technology are highly feasible and we are further emboldened that we really will disrupt this market to a very significant degree.

2.1. Work Performed:

The overview of the work done and the results are dealt with under the heading of each of the 8 tasks in this Phase 1 project.

2.1.1. Contract Marketer as Feasibility Study Coordinator:

CIRCA group Europe (CIRCA) were chosen to carry out this task.

2.1.2. Plan and calendar for study implementation

All tasks carried out as planned except for beta launch (see 2.1.3. below).

2.1.3. Beta Launch with German and UK joint venture partners

We will be doing all of this in the future, but we need to fully complete product development first. The focus of our marketing and software product development and testing efforts until now has been on White Label partners and software for these.

2.1.4. Survey B2C users, a cross sample of at least 10%.

The main purpose of the written questionnaire on “digital music distribution” was to gain some insight. These questions were designed to reveal what users thought of the existing services, how they determined what service to use, and any areas of concern that they were aware of.

2.1.5. Test joint venture pitch across markets with scheduled meetings in partner EU nations.

Since August 2016 EVEARA has been working assiduously to improve upon its joint venture pitch. As a result of these ongoing efforts dialog has been undertaken with over 30 mid to large size entities within the EU. Presently there are 5 signed joint ventures.

2.1.6. Test at least 6 different advertising outlets and channels with measurements on a feedback survey instrument online (how you heard of us).

As part of its efforts to build the most comprehensive digital distribution solution EVEARA has done a great deal of market research, and more specifically sought feedback from potential users. Outside of connecting directly with existing music contacts, LinkedIn, Facebook, Twitter, Google (SEO), and Musikmesse Frankfurt/Germany (Musical Instruments Trade Show) were used. A written questionnaire was determined to be the most practical means of extracting information.

2.1.7. Design and deploy a user study (both written and interview) to all levels Determine cross-country compatibility, legal concerns, and any financial security concerns

EVEARA has worked diligently in creating its software; that same care can be found in the company website. Additionally, the website is available in 15 languages (presently covering our most relevant markets). This method will be applied to our software application.

To date EVEARA has direct agreements in place with all relevant music retailers. Our end user agreement will be comprehensive and user friendly. It will cover user areas of concern that we have found through research and survey. Determine necessary changes for product features (including data feedback)

The EVEARA Technical Document is produced by this phase 1 study and it includes details of the product incorporating the changes in features.

The EVEARA system was built to simplify the process of delivering music to all the music stores (DSPs). Currently this process is a cumbersome and tedious, requiring multiple approaches.
Each DSP that EVEARA must work with has a different specification of package delivery. No two DSPs are the same.

EVEARA removes that complexity. Package delivery to DSPs has been custom built for each so that the user does not have to worry about the individual requirements. The user simply chooses from a list of DSPs to distribute to and the EVEARA engine takes care of the delivery.

2.1.8. Compile a comprehensive feasibility and market report

This task is completed with the support of 3 days mentoring provided free of charge by the Enterprise Europe network as part of the Phase 1 project.

2.2. Results and their Exploitation

2.2.1. Market Feasibility

Below is the list of specific conclusions relating to marketing coming from the Phase 1 project: There is a need for an active marketing campaign and the positive impact on company recognition that could result. From the survey of customer perception of our competitors is clear that emphasis is given to payments and the ability to “trust” what is being reported back to the user. Having examined through our survey; “What is most important to you when it comes to selecting a digital music distribution service”, we conclude that we are on the right track having developed a pricing model that is extremely competitive, and affordable, yet it does not cause EVEARA to compromise on aspects that are valued by users. These valued aspects are; 1 an easy to use user interface, 2 extensive functionality, and 3 comprehensive distribution network. With the methodical approach that EVEARA is giving to its entrance to the market, the digital music distribution service user, the current and future state of the industry, coupled with the vast expertise of its team EVEARA has an opportunity to disrupt the market. And last but not least, the demand for a 100% WHITEL LABEL digital music distribution solution is extremely high, and since EVEARA’s USP is full white label capabilities, it makes sense to initially start a B2B marketing campaign, and add B2C going forward.

2.2.2. Technical Feasibility EVEARA’s Music wizard is extremely intuitive and simple for the user. In comparison to all other competitors it is by far the simplest process, yet the most comprehensive, on the market. EVEARA’s reporting parameters assist the user in being more strategic with how best to capitalize on the performance of their music e.g. scheduling tours based on territories where content is most successful. Social Media integration allows the user to connect with fans instantly when music is being made available to DSPs. EVEARA being the only 100% WHITE LABEL solution on the market will ensure fast and sustainable growth.
Our aim continues to be to make EVEARA the foremost solution for digital music distribution in the world, advancing European music to new and underserved markets across the world. In meeting this goal, we will address the EU-wide challenge of small businesses and individuals making use of the internet and new digital markets to make sizeable and sustainable revenues – increasing the GDP of Europe as a whole and empowering hundreds of thousands of musicians and small businesses to have a viable stake in the digital music world. We will also take a significant market share of all 20 major global markets – including the United States (the largest existing digital music market) and China – with a superior product and service that attracts customers through quality and service.

No service in the world incorporates all of these levels of use in one neat package, and none in Europe even exists to serve European SMEs particularly. Hence we are confident we can take a significant portion of the European market share (at least 10 percent) within five years, and 1.6 percent of the entire global market share. We are also simultaneously working to expand the software to video and other platforms to gain even more users. The ultimate goal is to grow from a digital music warehouse to a digital media giant. The product and technology roadmap includes a series of additions to broaden the appeal of EVEARA and create new revenue-generating opportunities, including: Blockchain, Statistics Module, Music Streaming (Genre & Reg.), Music Streaming (Meta), Content Database, Licensing, Publishing and Video.