Seeing Green at the House of Blues

The House of Blues (HOB), has been doggedly hoarding a massive cache of streaming content with proven audience appeal, and developing new ways to deliver and monetize that content.

Since 1995, HOB has captured thousands of live music performances on videotape, and will capture between 800 and 1,000 concerts this year alone. Today, www.HOB.com offers at least one free narrowband concert daily; three or four broadband pay-per-view ($7.99) concerts a week; a revolving menu of free archived on-demand concerts and artist interviews; and audio and video single downloads drawn from previously recorded concerts. HOB has distribution or promotional relationships in place with Real Gold Pass, AOL Plus and MTVi, and is actively discussing additional distribution arrangements with other third parties.

HOB recognizes that — at least for now — income from streaming alone is not sufficient to cover production costs. HOB sees streaming media as just one part of a multifaceted distribution strategy. Phil Fracassi, senior vice president of production and distribution for HOB Entertainment, notes, "There are more ways to distribute content today than there have ever been, and they're all monetizable in one way or another. The reality is that the Internet is just one form of distribution, and frankly is not the [most economically important] form today. It's going to emerge in the next few years to be a premiere model, but right now it's something that we're building and learning from."

HOB also offers a rotating selection of archived on-demand concerts and interviews with artists — audio, video or text-only — drawn from HOB's massive library of recorded material. Over 200 concerts and 150 interviews — some at 300Kbps and 650Kbps bit rates — are currently available on-demand, for free. Finally, HOB offers audio and video single downloads (240 audio; 50 video) culled from previously recorded concerts. Licenses for audio (free) and video ($2.99) downloads are issued for 90 days — using Microsoft's DRM — and are auto-renewable at no extra cost. (When HOB's licenses with artists and labels expire, user licenses are no longer renewed.) Downloaded files can only be played back on the machine that originally received them. "Video downloads are a way of letting people in the narrowband world experience broadband quality on the Internet," says Nick Wild, director of technology for House of Blues Digital.

HOB receives revenue from pay-per-view and downloads; banner and in-stream ads; and the online sale of tickets, T-shirts and other branded merchandise. But much of the value HOB receives from its high-profile presence in the digital space comes in the intangible form of goodwill with its artists. Wild points out, "House of Blues has been about a partnership with the artists. That starts with the relationship at the club level. We're collaborating with the artists to find [revenue] models that they're comfortable with. And wherever there is revenue, we're sharing it with them."

Ultimately, real dollars will have to flow in to replace the real dollars spent on production costs and overhead. HOB is betting that new delivery platforms — with new revenue channels — will enable audiences to satisfy their thirst for streaming music content at HOB.com. Fracassi predicts, "People are going to be accessing content through their televisions, their cars, their phones, their PDAs, and their PCs. HOB's vision is that there's a huge unmet demand for live music. We feel we have the brand that can drive it. And we're going to drive it consistently through every single media outlet there is."

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