Hello DI.FM investors,
I am pleased to share a few updates about the ongoing crowdfunding campaign and about our service in general.
Crowdfunding campaign update
We have now passed over $300,000 in received investments which are now held in escrow on WeFunder. Additionally, we have more investors in the pipeline and some of the funds are pending as is usually the process. This means we have now reached our minimum requirement to unlock and release our Tier 1 goal and are working with WeFunder to get the funds released to us. You may have received an email from WeFunder confirming this process by now. Thank you again to all of you for making it happen.
Directly licensed content update
Over the last couple of years DI.FM experimented with licensing content directly from certain content suppliers. These licenses permitted us to use covered content in more ways than just passive streaming. These direct licenses allowed us to experiment with on-demand (interactive) access for those tracks and the ability to sell those tracks as downloads in the US and the Netherlands.
We recently made the choice to no longer support or pursue this form of licensing in 2018, instead continuing to rely on the passive streaming (aka non-interactive) licenses as we have done to date with our service. One example of the licenses which we will keep is with Sound Exchange that allows us to stream non-interactively in the US.
There were a few different reasons which led us to make this decision:
- Direct licenses for interactive streaming were more costly than non-interactive licenses available through different bodies.
- We did not see evidence of improved KPIs based on the few licenses which we had in place. We can only presume that we could see a benefit if we obtained a direct license with nearly every supplier for electronic music out there. However, there is no guarantee of that and in our experience, it has proven long and costly to get new direct deals established.
- Retailing tracks (downloads) is a shrinking business as consumer usage continues to shift to streaming and does not present a real opportunity for significant revenue.
- The related technology and administration of these licenses would continue to consume manpower and resources which may be applied better elsewhere in our business.
As a result of this experiment, we decided to continue our focus on the “lean-back” experience for which we have become known for throughout the years. We are confident this is the right path for us, with many improvements and new features already in development or in the development pipeline. Some of these features will focus on expanded content choices, while others on personalization and ease of use. Importantly for our investors, we believe that other features will focus on better retention and monetization of our users.
Mobile trials update
This month we began the roll out of our 30-day free trials to our Premium service for DI.FM mobile apps. The iOS update has already been released, with the Android version starting to be released over the next few days. These trials require a user to tie their app store payment method, so that unless cancelled, the paid subscription would begin after the 30-day trial completes.
Up until now, DI.FM users were only able to purchase a Premium subscription by way of immediate payment. However, by introducing a 30-day trial we believe we will ultimately convert and retain more users to our paid Premium subscription. This is one of a few various improvements which we have in store for the service over the next few quarters.
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