By Robert Menta- 12/11/00
Riffage is dead. A direct competitor of MP3.com and the Universal owned FarmClub, the digital music site was founded by seasoned executives from the record industry. That seasoning did not help as the money, which has become so scarce for Internet sites, ran out on the 18 month-old company.
Members of the site were sent emails at the end of Friday's work day announcing the demise of the company with the subject heading "We're Sorry". The letter was brief and to the point:
For the past 18 months Riffage has pioneered efforts to unite fans and musicians - building a loyal following for emerging artists and using the power of the internet to expose new music. Pioneers enjoy the thrills of new frontiers, but must also deal with the risks inherent in uncharted territories.
Having reached out to a million fans and tens of thousands of bands, we cannot continue to service these fine communities in the current economic marketplace. As of December 8th, Riffage will cease operations.
We would like to thank the artists, fans, writers, labels and partners who helped us over the last 18 months.
Net music sites have taken a beating in the marketplace this year, worse than the Internet in general. On top of the vague business plans and weak profit models found in many Net sites, digital music sites also have the tumultuous issues of copyright litigation, which has scared off any remaining VC capital for their Web businesses.
Indeed, the record industry itself has fanned these fears. Targeting venture capital supply as a strategic tool for winning its battles against Napster and MP3.com, the major labels wrote directly to VC's with open threats that any new money would find itself tied up in litigation expenses. The end result was a freezing of capital funds to all digital music sites including those like Riffage which only used the music of unsigned artists and therefore were not subject to the copyright claims of Big Music.
Riffage was not the only digital music site to call it quits Friday. ! iCAST, a Net Radio struggling for the last several months to find need funds, also shut for good at the end of the workday.
Margaret Heffernan, CEO of iCAST Corporation, placed this brief message on the company's website to replace its home page.
"We sincerely thank our users and partners for their past support, and we hope you've enjoyed the interactive entertainment content and services we delivered."
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