A Direct-to-Consumer Solution for the Music Recording Industry

2

A Decade of Declining Revenue for the Music Recording Industry

 $‐    

 $2.0  

 $4.0  

 $6.0  

 $8.0  

 $10.0  

 $12.0  

 $14.0  

 $16.0  

1999  2008  2013 (Billions) 

Revenue for CDs, vinyl, cassettes and digital downloads

Forrester Research

3

Artist demands latest Internet widget to connect to fans.

Label Exec rallies IT and comes up with a plan.

Finance pushes back on costs, causing underinvestment in

Internet plumbing.

Marketing engine turned on, website performs poorly, and

artist and fans are upset.

Label Exec spends months rebuilding artist relationship,

label loses 360° business.

Record Labels Have A Broken Business Process

4

Option A

Music Fan

3rd Parties

Record Labels

Music Fan

3rd Parties

Record Labels

Relationship Options

Option B

5

Common Website Infrastructure Challenges for Labels

•  Marke&ng is Innova&ng Faster than IT 

•  Well Planned Promo&onal Events are Poorly Executed 

•  Demand is Unpredictable    

6

Labels Should Shift IT Effort to Activities that Differentiate

Network and Application

Infrastructure

Business Process

Applications

Dif

fere

nti

ati

ng

No

n-D

iffere

ntia

ting

Current State

With Rackspace

Rackspace manages your network and application infrastructure plus provides cloud computing and professional services so you can focus on the business processes and applications that differentiate your business.

Diffe

ren

tiatin

g

The Label Can Now Focus on Building Relationships with Artists, Marketing to Fans, and Developing Relevant, On-Demand Content

7

Network and Application Infrastructure

Real-time Application and Infrastructure Monitoring and Remediation

Customer Relationship Management (CRM) Database

Content Management Solution (CMS)

Analytics / Mobile Email / E-Commerce

Artists’ Websites / Artists’ Brands

8

The Rackspace Media Services Solution

Web Scale Engineering

Real-time 24x7 Proactive Monitoring &

Consultation

Server Burst Architecture

Release Engineering, Change Management,

& Load Testing

Rackspace Strategy & Implementation Team

9

Rackspace Media Services Provides Real Value

Solu&on  Features  Value 

           Rackspace Strategy &             ImplementaCon Team 

•  Assessment of strategy and exisCng technology elements •  Customized implementaCon plan based on a label’s unique strategy •  Dedicated account team 

The Rackspace team provides both the industry understanding and the technological experCse to deliver a D2C strategy soluCon that will enable the label to moneCze their business. 

            Web Scale             Engineering 

•  Rackspace Media Services employs only the very best LAMP engineers •  Pre‐empCve issue resoluCon •  Run‐Cme opCmizaCon and tuning  

The label has peace of mind in knowing they have the best experts dedicated to their D2C soluCon and available 24x7.  The label can now focus on core business needs. 

            Real‐Cme 24x7             ProacCve Monitoring             & ConsultaCon 

•  24x7 real Cme monitoring of the infrastructure and ArCsts’ sites •  ProacCve trend analysis and alerCng •  Extensive analyCcs and reporCng 

Deeper insight and monitoring means your ArCsts’ websites stay up.  The label maintains creditability with ArCsts and fans. 

            Release Engineering,             Change Management             & Load TesCng 

•  Cross browser, OS, and screen size compaCbility tesCng •  On‐demand, geographically diverse website load and performance tesCng 

The label can idenCfy problems before going into producCon resulCng in more success for markeCng promoCons. 

            Server Burst             Architecture 

•  Dedicated, secure burst capacity for rapid IT scaling •  Extra capacity for high load / high demand situaCons 

The label’s web services infrastructure and all of the ArCsts’ websites can handle unexpected spikes in traffic.   

10

A Four-Phased Approach to Building Your D2C Solution

1.  Diagnos&c Study 

2.   Solu&on Development 

3.  Implementa&on 

4.   Op&miza&on and Maintenance 

About Rackspace

  Founded 1998 – 0ver 10 Years of Hosting Expertise

  Headquartered In San Antonio, Texas

  Ten Worldwide Data Centers to Serve Global Needs

  Recognized as One of the World’s Leading Service Companies

  2,770+ Employees (aka “Rackers”)

  90,000+ Customers and Growing

  Listed NYSE 2008 (RAX)

11

Gartner Magic Quadrant