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THE founder of 1800 on Hold has struck a chord in the hospitality industry with a new venture that provides background music to restaurants and cafes.
Troy Cooper (pictured) has launched Moo Moo Music with $30,000 in start up capital to provide a music storage device containing tunes by Australian artists to hotels, restaurants, cafes and clubs.
While a chunk of capital was used in IP and building the website where musicians can submit songs, the company has befittingly signed up Moo Moo Hospitality Group as one of its first customers. The Coffee Club chain, Montezumas, the Choice Hotels chain and Doyle’s On the Beach in Sydney have also signed, along with around 300 others Australia-wide.
“The feedback we received from restaurant owners is that traditionally they are not playing top 40 music, but are paying massive fees to PPCA (The Phonographic Performance Company of Australia),” says Cooper.
“There has been a lot of confusion in the market. A lot of restaurateurs assume that if they purchase the songs from iTunes they’re covered, but iTunes is not for commercial use. The PPCA is in panic mode to get revenues from the traditional model of record and CD sales, but sales have dropped. With our model, un-named artists can submit songs to us and we can categorise them and they get paid royalties for use.”
As the PPCA continues to raise fees and prosecute non-compliant businesses, Cooper says Moo Moo Music is providing an alternative to music piracy and creating its own market. A recent announcement by the PPCA to increase fees means instead of paying $1500 a year, a restaurant could pay up to $9000.
Cooper says the Australian music industry needs a complete business model overhaul to survive in the internet age.
“When it emerges that British metal band Bring Me The Horizon needs only 3600 album sales to claim a No.1 ranking on the ARIA Charts (October 19, 2010) that tells you there is something fundamentally wrong with the structure of the industry,” he says.
“It’s time to get serious about protecting the rights of music artists to ensure the longevity of the Australian music industry and that’s going to require innovation.”
Illegal music downloads have hit the industry hard with roots singer John Butler estimating that his 2008 award winning Grand National album sold 40 per cent fewer albums due to illegal file sharing.
“Obviously no one is happy with potentially losing almost half of their income, but there is also another challenge facing Australian musicians not receiving payment and it’s caused by the very entity that is supposed to ensure artists are paid,” says Cooper.
Gold Coast musician Casey Barnes, a 2009 Australian Idol Top 12 finalist, is one artist supplying music to a playlist that covers everything from instrumental, ambient and country, depending on the clientele.
“The restaurants will jump on it in coming years, we see a huge opportunity for licensing. It will be rewarding to build up a nice catalogue that can be played world-wide containing music from around the world,” says Cooper.
While a similar concept has been adopted in the fitness industry, Moo Moo Music will stick to its target market.
“People talk about 1800 On Hold and that has had good growth with annual turnover of around $1.5 million, but this is a bit different, it’s nice to be in the music industry,” says Cooper.
The company is fielding enquiries from hotels and shopping centres, while the Melbourne Exhibition Centre has also expressed interest.
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