Initial reaction to the
news that Universal Music Group and Sony BMG Music Entertainment have participated in a $2.8 million round of funding for music blog network MOG Inc. included some
privacy concerns. The company's MOG-O-Matic tool scans individual users' hard drives for music files and shares them with the world, potentially exposing a user's entire music library -- including files received through piracy -- to the scrutiny of
record labels that hold a stake in MOG. Those same labels have
participated in lawsuits against individuals who possess pirated music.
But a UMG source familiar with the company's position on the investment
denies that an interest in snooping played any part in its decision to
invest in MOG. "It was not even remotely a consideration," the source
says, noting that all four majors also have deals with Apple Inc.'s
iTunes, which also sniffs out MP3 files on users' hard drives. Rather, UMG was concerned with "building more value" for its artists and songwriters and "expanding legitimate use" of their work, the source says.
UMG and Sony BMG took
minority stakes in MOG alongside private investment group The Angels' Forum, which had previously provided seed capital to the company. MOG helps music
fans find each other and discover new music via a network of blogs
that stream music, as well as the MOG-O-Matic tool which identifies users' tastes. Including the seed round, MOG has now raised $6 million total; the investors are
said to own 47% of MOG collectively.
-- Paul Bonanos
See April 29 post from Tech Confidential regarding UMG and MOG
For more see
VentureBeat,
Hypebot and
Wired Listening Post
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i'm david hyman, the ceo and founder of MOG
the 47% is way way way off.
much smaller.
thanks,
david