Sonific, creators of the SongSpot widget that enabled bloggers and others to embed a single song player anywhere with ease is going offline May 1st. Co-founded by music futurist Gerd Leonhard, Sonific sited unreasonable label demands as a primary reason for the shut down.
"When we approached the major record label decision makers in order to obtain licenses...we have routinely faced demands for very large cash advances and fixed per-stream minimum payments, pressure to give them 'free' company equity, and requirements of utterly bizarre usage restrictions. It seems that the industry's major stakeholders still prefer this turf to remain unlicensed rather than to allow real-life, workable and market-based solutions to emerge..."
Expect others to follow Sonific offline unless major labels shift to the strategy already adopted by most indies - spreading music virally leads to sales. Even deeper pocket startups from imeem to SpiralFrog will be unable to sustain unrealistic financial demands forever.