French Music Streaming Service Qobuz in Dire Financial Straits

Qobuz, a French digital music retailer and streaming service, has been placed in protection by the courts in France, in a procedure similar to chapter 11 protection in the US. This site, which is one of the only sites offering lossless streaming, and which is available in several countries in Europe, just launched its service in the UK, and is planning, at some point, to launch in the US.

In my last months in France, I subscribed to Qobuz, and they’re one of the best streaming sites for classical music. They offer high-quality music – if you want to pay a bit more, you can stream lossless – and liner notes. As a retailer, they have a large catalog, and use most of this catalog (those labels willing to allow streaming) for their streaming service. They even offer a classical-only streaming subscription.

Alas, Qobuz found Yves Riesel, in a statement in French, vaguely defends this decision, saying that it will help stabilize cash flow and allow the company to be reorganized. There is no mention made of either the free streaming competition, or record labels and their demands. The French business newspaper Les Echos says that they only have 25,000 subscribers, and an annual turnover of €9 million, but doesn’t say if that turnover is just for streaming, or whether it includes digital music sales as well.

In this article on the website, Yves Riesel says “Our biggest mistake seems to be being French and being crushed by the Orange-Deezer bulldozer…” Orange is a large phone company and ISP in France, who offers subscriptions to Deezer free with certain plans.

I have also been informed by sources in the classical record industry that the physical distributor Abeille Musique, created by Yves Riesel, and owned, like Qobuz, by LyraMediaGroup SA, is in the same situation.

This doesn’t bode well for an upstart streaming service, but I think, in the long term, it won’t be easy for anyone to fight off Spotify, and now Apple, who should soon be embarking on a similar service. Qobuz is great for streaming classical music, but that market is so small, it may not be viable to have the infrastructure for such a service at an affordable price.