by Charles Bermant June 19, 2000 Downloadable music is thought to threaten the existence of large record companies. But a small Internet-based CD distributor called Altovoz Inc. has found a way that online music can be used as a sales tool that supports the retail process; complementing rather than competing with brick and mortar distribution sources. "We are distributing a new product that wouldn't make it into the stores otherwise," said company founder Nelson Jacobsen. "While someone signed to a major label is guaranteed distribution, 80 percent of all the new music out there is actually on smaller labels. So we give those people a chance to be heard, and sell their music elsewhere." Jacobsen said that a listener who likes a downloaded song will often go out and buy the CD. As for Altovoz, he said the service can provide statistics about the most popular downloads from its own site to regional music stores, so they can stock music for which local people have already expressed a preference. That a lot of bad amateurs now have access to digital technology makes it difficult for Jacobsen to separate the wheat from the chaff. "We get an amazing amount of junk in here," he said. "Just the other day I got a CD from a Swedish country and music band." But among versions of "A Boy Named Helga" there are some authentic gems. "The lines between artists and labels are blurring, since so many artists publish their own CDs," he said. "Bringing the artist through the Internet and into the music business sets the current process on its side. Any talented artist can take advantage of this." "Talented" is the catch. Just because Altovoz offers a leg up in getting the music placed, the artist still needs to create a promotional campaign and tour to support the CD. "This is only the beginning," Jacobsen said. "The band still needs to work very hard." Currently, Altavoz has about 700 songs available for download, a number that Jacobsen said far exceeds some better known sites. The company is now operating with $80,000 from Osborn Capital LLC. Jacobsen said that company principal Jeff Osborn really understands the business. "If you bring in the wrong VC it can kill your company" Jacobsen said. "We always had faith, because there are companies that are getting lots of money for ideas that are a lot dumber than ours." He added that the DC area location has hindered the company as it is not exactly a hotbed for entertainment investing. "If you're not a Telco or something it takes them a while to figure out what you're doing." Osborn, however, gets it. "Altavoz gives a whole new generation of garage bands a shot at national distribution," he said. "If they can put together a CD and get a few fans, they have a chance of seeing their CD in places like Best Buy and other large outlets. This changes the basic paradigm of the recording industry." Company Name: Altavoz Inc. Address: 50 W. Montgomery Ave. 335, Rockville MD 20850 Phone: (301)-309-9496 Fax: (301)-309-9685 Contact e-mail address: nelson@altavoz.com Web address: http://www.altavoz.com/ Total Funding: $80,000 Investors: Osborn Capital |