Psonar is a pay for play streaming music service that provides a healthy alternative to the all you can eat buffet style of Spotify. The Cambridge, UK-based social music service is also a community in which users can discover new music, sample it and, if they want, buy it to add to their own collection. The companies pay as you go model is very appealing to the growing masses that are currently using no contract cell phone services. Their business model is very simple, you pay $5.00 and get 500 plays.
Below are the results of a brief conversation that I recently had with Psonar CEO and VC Martin Rigsby.
Kelland: What is your background?
Martin:Our background is primarily within the technology space. Richard Urwin who is the CTO and I were kicking a few ideas around in 2008 for mobile technology and we saw how teenagers where using a lot of technologies to listen to music but it was difficult for them to manage it. So our original idea was to create a locker service for teenagers to be able to access their music from any device at anytime. But, that had a lot of problems because of licensing issues. So we had spoken with the head of digital music and Universal and he expressed his frustration because no one had come up with a model to monetize micro payments for digital music. So that was the turning point.So with Ray Anderson who is another Co-Founder is the CEO of Bango, which is a mobile payment platform and my background in finance we thought we would be able to come up with a solution.
Kelland:After that light bulb struck, how long did it actually take to launch?
Martin:We are actually in a third generation of the Psonar, but we have actually been working on this particular iteration for about 18 months.
Kelland: How has the response been?
Martin: It’s been really good! The indie community particularly in the U.K. and in the U.S. have really taking a liking to it. Also, we have got a lot of positive feedback from the consumers. People love our technology as well as the IOS app. Plus our price point is really compelling.
Kelland: What is the price point per track.
Martin: To stream a track it costs you one U.S. Cent and one Euro cent. So you buy credit by using your cell phone,PayPal account or credit card. The minimum amount of credit you can buy is .49 which is 49 songs. A very important part of the whole process is you can actually give streams to other people.
Kelland: What are the advantages to using a per stream service versus a monthly all you can listen service?
Martin: For the consumer if you dont’ want or can’t afford to commit a $120 a year, the pay per stream is a much more flexible way to consume music. Also for people who have prepaid cell phones or don’t have a debit or credit card billing directly through your phone is great. Labels and artists are able to encourage people to buy their music through our new platform called “Viral Promotion.”
Kelland: Explain Viral promotion to me?
Martin: The idea with “Viral Promotion is if you have a new EP or concert you can actually send out a playlist or EP to your existing fans and they can play it once. If they want to unlock it they would have to do so by sharing it with someone else.
Kelland: What are your plans for the future?
Martin: We think we have the capacity to be the dominant player in providing people on pay as you go mobile plans with great music. And, that’s actually 49% of the market in the U.K. and it’s just a bit less in the U.S.