Project Playlist is now acquiring the assets of TotalMusic, according to details emerging this afternoon. TotalMusic is a digital catalog management and reporting system originally hatched by Universal Music Group and Sony Music Entertainment - and shuttered earlier this year. Project Playlist officially released news of the acquisition through a blog post Tuesday afternoon. "We recently acquired assets and employees from TotalMusic LLC, a digital catalog management and reporting system," the post confirmed. "This acquisition is an important platform that will allow us to host a streaming music service, help us with e-commerce solutions and provide a set of application programming interfaces that will be invaluable to us as we offer next generation digital music services to our users."
On its surface, the deal seems bizarre. Universal Music Group is actively suing Project Playlist, alongside Warner Music Group. But insiders have been pointing Digital Music News to an almost incestuous relationship between the various parties, and a probable resolution. Project Playlist - often referred to simply as 'Playlist' - remains well-funded, according to sources, and its legal costs are part of a serious cash-burn. "They're going to make this go away," one executive with close ties recently relayed. "And it's going to cost a fortune."
Others are telling a similar tale. "Too many powerful old record execs are on the Project Playlist board for this not to happen," a major label executive with knowledge of the negotiations shared. "Look for a settlement sooner rather than later." Indeed, Project Playlist has just finalized royalty negotiations with EMI Music Publishing and Sony/ATV Music Publishing, and settlements with EMI Music and Sony Music Entertainment have already been sealed.
In that light, a deal with all four majors seems probable, though Playlist appears headed for a familiar trap. Majors have traditionally exacted ransom-like royalty demands upon startups, a major operations drain for those wanting to play legit. One recent example includes Imeem, a company now hanging by a thin thread of funding. Project Playlist might be looking at a similar fate.
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