Music Providers Get Royalties for Streaming Videos

A brand new way to license music for video synchronization has led independent artists as well as music publishers to realize fees from a new revenue stream. This is yet another business model that has been created in an industry that continues to reinvent itself. Indoor Cycling (often called Spinning®) has finally begun to pay artists for the music they use through live broadcasting and subscription based on-demand videos.

Lower Burrell, PA, April 28, 2011 --( Upon completion of a 12 week Winter Training Program by Pittsburgh based Cycling Fusion, 58 independent artists and 12 other multi-track music providers were paid based on the viewing rates over the same period. The program was only a pilot to determine the market acceptance and “stickiness” of the concept, but it proved quite successful.

“We needed to see first if those who ride inside to live instructors would accept and stay engaged to someone teaching 3,000 miles away and riding with their broadcasted image on a 10 foot screen. Secondly, we needed to see if those who ride outside would be willing to stick with a 12 week program especially if they already live in a ride-year-round climate. I’m happy to report that I can stay an emphatic 'yes' To each query,” said Gene Nacey, originator of the Indoor Cycling Broadcast.

While the instructors struggled picking music from a much smaller selection than the totality of their own respective iPods, they were pleasantly surprised by the quality of the artists represented on the PreCleared Synch Library.

The PreCleared Synch Music website was the brainchild of Gene Nacey, experienced entrepreneur from the healthcare technology world. In 2008, Mr. Nacey formed Global Ride Productions to produce virtual cycling DVDs for use in group cycling classes at his new Spinning® facility. He immediately got an education on copyrights, music licensing, publishing rights, split ownership, synchronization licensing, and a lot more of the Intellectual Property quagmire that besets those wanting to add good music to Indoor Cycling videos. It ultimately proved to be the biggest challenge to completing each DVD title.

“Shortly after our first box set of DVDs were produced, improvements of video playback on the web and new training technology, such as power meters, seemed to collide in perfect harmony. This essentially paved the way for more cycling training at group indoor cycling classes while now offering video streaming from the web instead of using traditional DVDs. Not only this, but the concept of finding the best instructors in the world, and taking their classes remotely now seems to be the proverbial Idea whose time has come,” said Gene Nacey, Cycling Fusion founder.

Music is the emotional motivation to every group class, but it still needs to be licensed to make it a viable business model. The thought of taking 3-12 months per song (the average time it was taking to license music for the DVD) equated to a non-negotiable obstacle that had to be removed if this new concept was going to fly.

The only thing that made sense to Mr. Nacey was a central collection of music that was “pre-cleared” to be used in videos of this type. However, publishers and master rights holders are accustomed to getting their license fees up front for each synch project. For this to work, they would have to agree to get paid after the video was produced and then viewed by a paying customer. A customary practice with simply audio streaming, but not for the video business.

“It was a tough sell. Especially to the same companies that I had paid in full for a thousand DVDs just the year before. Now I was asking them to take a chance on getting paid a lower amount on the promise of higher volume from streaming use. Fortunately the music industry had already seen so many business models turned upside down, that this didn’t shock them, and I secured some early adopters that really paved the way for our pilot Winter Training program,” said Gene Nacey, Cycling Fusion founder.

Only time will tell if this unique niche of streaming video can generate enough cash to pay the artists for every song that is played. The concept is fascinating and the prospects for artists should be tempting enough to challenge even the staunchest unbeliever.

About The Company
Cycling Fusion™ is a company dedicated to bringing the best of indoor and outdoor cycling together through technology, education and certification for indoor cycling. Cycling Fusion™ certifies both facilities as well as Indoor Cycling instructors for implementing and teaching Indoor Cycling. Cycling Fusion™ aims to bring more outdoor cyclists inside to train, and encourages and equips indoor cyclists to experience the joys and adventure of riding outside.

Cycling Fusion™
2809 Leechburg Road
Lower Burrell, PA 15068

Cycling Fusion
Laura Smith