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DNA and Deezer on the way to break the « Finnish Paradox »

14.03.2014

The music streaming revolution has started 5 years ago and keeps growing years after years, bringing growth once again to the music industry (+44% in volume and + 59% in total value in 2012).

This revolution is at the expense of physical sales with the appearance of new technologies and new devices like smartphones and now tablets. Music streaming is also a new way of consumption that totally corresponds to our modern society : access to millions of songs, anytime, anywhere, on any device for the price of 8 tracks on legal dowloading platforms (9,99€).

Music streaming also helps reducing illegal downloading because pirates can now have access  immediately to more than 30 million tracks for a very affordable price. In Finland, piracy has for example dropped to low world record of 9%.

In the most advanced markets like Sweden, digital music now represents 71% of music sales (of which 90% is streaming) and physical sales have dropped to a low 29% market share.

It took a bit more time for Finnish music fans to adopt music streaming compared to other Nordic countries while being a tech-savvy country where over 80% of all sold phones are smartphones and the existing smartphone penetration is already over 60%. This is what we often call « the Finnish Paradox ».

But the paradox is about to be broken in the next few months.  The streaming revolution is definitely blooming in the country of the « thousands lakes »: in 2013, streaming increased by 41% in one year while CD sales dropped by 13% and downloading by 10% in 2013.

I feel that 2014 will be the year of music streaming in Finland because the potential is so huge and the market still very open : physical sales still represent 64% while digital now represents 36% of sales (of which 81% streaming). In 2014, I feel digital sales will be over 50%, mostly driven by streaming services like Deezer or competitors.

Deezer is a broad and exciting global music subscription service created in France in 2005. Biggest service in France, Deezer then entered the UK, Germany and Benelux  in 2010.

In November 2012, we were able to raise 130 million $ from US-based venture Access Industries to open in more than 182 countries, becoming the only true global music streaming service.

Deezer has today 35 million users, 5 million of whom are paying subscribers in 182 countries.

It lets fans enjoy music like never before with access to more than 30million tracks, instantly available on any device – desktop, smartphone, laptop, tablet, wireless home speakers, in-car audio, smart TVs and Xbox.We differ from competing music services for instance by employing more than 50 music editors around the world. Users will receive music recommendations through Deezer, based on selections made by these expert editors. In Finland, interesting tunes will be added to Deezer’s music list by Editorial Manager Jouni Pesola, the music editor for Finland and the Baltic countries.

Nadine in Australia, Tecla in South Africa, Nantarika in Thailand or Yasmine in Brazil for example have the same mission to entertain music fans from all over the world.

Telco partnerships are a great way for us to launch in a country, so it’s always something we’re keen to explore, especially if there’s a suitable partner with the same desire to share music with its customers. We won’t partner with anyone – where we can’t align with the right partner, we launch as a standalone service.

We see a genuine global opportunity for mobile carriers to become the new music distribution network.  They’re able to reach people and places that traditional, physical distribution never went near.  As music moves online and it becomes more about usage than ownership, listening to music will no longer be confined to a country or restricted by borders.  We’re encouraging a reorganisation of cultural expression worldwide, and mobile carriers can lead this revolution.

We have 35 Teclo partners today and we are very happy to launch an original offer in Finland in cooperation with DNA. We are both challenging bigger players and therefore we need to be constantly more innovative and reactive. DNA was definitely the best fit for us.

DNA will offer the Deezer Premium+ service at half price for six months for the subscribers of its Äly, Veppi and Rajaton plans. These users will pay only EUR 4.99/month (regular price EUR 9.99/month) for the first six months of the service.

And this is just the beggining : DNA customers can expect constant innovation and entertainment from both DNA and Deezer.

Bileet käyntiin, Suomi!

Mathieu MOLINERO, Head of New Markets @Deezer

DNA <3 Jolla

04.12.2013

The co-operation between DNA and Jolla has been awesome. More than twelve months of mutual journey was culminated on Wednesday 27.11. approx. 7 p.m. when the world’s first Jolla phone was sold to a customer. The atmosphere at the event was off the roof. It was nice to see such a large gathering of media buzzing around the DNA <3 Jolla tent. We at DNA highly value the possibility of being involved in building the next Finnish success story with such a great potential.

DNA has been involved in the development process of the phone, bringing in the end-user viewpoint to maximize the user-friendliness. Personally I’m extremely satisfied with the gesture based Sailfish operating system that runs smoothly. Jolla is a perfect match for those who want to stand out from the masses with a handset that can be modified to match the user’s preferences.

The Sailfish that is running inside the Jolla is a Beta-version, which will be developed further from the feedback given by the users – the way every successful company should do, source feedback from your customer crowd and develop your business accordingly.

Jolla is also a specimen of not doing everything on their own. It runs Android applications and Nokia maps are also included. They have so to say “picked the raisins out of the buns” to bring the best parts of others available to Jolla users, while they differentiate themselves from the competitors with the intuitive Sailfish OS. This is what DNA is also aiming for with our partnerships. We want to provide our customers the best services and distinctive added value through co-operations with these innovative companies, Jolla being an example of this.

Although DNA’s way of operating is fast and flexible, it has once again been an eye-opening experience to see the intensity and the startup-mindset how Jolla is working towards their mutual dream. If every Finnish company would operate with such intensity towards their goals, only the sky would be the limit for our future success stories.

As a conclusion from our co-operations with Jolla, a simple recipe for success can be drawn – intensity of working towards mutual dreams, right partners, innovations that enhance the business and continuous improvement fueled by the users’ feedback. When these are in place, and it’s time to showcase the accomplishments, it should be done with head high and with pride. This is precisely what we did together with Jolla and the first customers at Narinkkatori, when the worlds’ first Jolla phone reached the hands of its customer.

Excuse me but is co-operation just the privilege of startup companies?

28.10.2013

In late August of this fall, we took part to Midnight Pitch Fest event as a sponsor and as a member of the pitching jury. The event was laidback and the crowd of over a thousand peers was visibly enjoying the atmosphere. In an event as such, where some 70 companies are pitching their varying business ideas and concepts, one is given a good opportunity to see and feel what the Finnish startup-scene is like and especially to the points where we still have room for improvement.

In Finland selling is not appreciated. A Finnish entrepreneur is a humble, unpretentious and almost asking for forgiveness when she/he is talking about how the product of their beloved company has potential in both the American and the Asian markets. As I recall Alf Rehn stating in his pitch that it should be taught that selling is ok and should not be ashamed to do, at Finnish elementary schools.

Co-operation amongst startup companies is so natural that few even notices doing it. At events such as the Midnight Pitch Fest, it becomes obvious how well the startups are interconnected. Resources are being interchanged and while concept designing the products and services, the companies are taking others with that are aiming for the same market.

Corporations need to dare to listen the “other guys”. Sami Kuusela, aka “the hoodie dude” told a great story about how his pamphlet came about and how it will continue. On the next week, he was meeting, not the “other guys” but rather corporate directors. So, the question is, is it really possible to find a co-operative model between corporations and startups that will produce the better service for their customers?

If I reach out and look at the situations of several well-known companies from even a higher perspective, I come to the following thought; the startups that have been successful with their business operations and have further grown into corporations, are now challenging the industry’s older corporations knowing that those companies have a hard time competing if the competition needs other than the core knowhow, assets and business models.

Some examples of those startups grown into corporations include Google, Facebook and PayPal. Local companies that are being challenged by them are obviously frustrated. Telecommunications companies are concerned about their voice, sms and tv-services, media companies about their printed media and add sales, financial institutions about their payment services. How have they then reacted to this? Several of them have not reacted in any other way than concentrating on competing against fellow companies within the market more intensively. Does someone actually think that the problem is solved with intense (price) competition? I don’t think so.

I’m not going to be embarrassed although I’m trying to sell my point to you.  Would it be possible for us corporations, to aim for a situation, where companies across industry boundaries would take lessons learned from the “other guys” and would start to consider where we could co-operate and by doing so, answer the pressure of those former startups grown into global ecosystems?

The Growing pains of a seed phase entrepreneur

09.09.2013

‘And the winner of the DNA Ltd. sponsored seed B category is Havina Productions!’

These are the words you want to hear when taking part in a Pitching Contest and this is exactly what we heard two weeks ago in the Oulu Midnight Pitch Fest. Now it’s high time for a tiny seed phase start-up to start considering itself a serious player in the world of giants!
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It is easy to create Startups, isn’t it?

02.07.2013

When you read the Finnish press and governmental sources you might get to think that it is just a matter of decision to become a successful startup entrepreneur. So just by making the decision your startup will suddenly flourish and become successful.

I have a quite broad experience of working amongst startups as investor, entrepreneur and also as a researcher. I have conducted few profitable exits as an entrepreneur but I have also failed miserably. As an investor the story is similar. I have written my PhD about growth entrepreneurship and venture capital. Still, I cannot say which company will succeed and which will fail. However, I will try to present a few components that successful entrepreneurs should consider while developing their ventures. Read blog »

Getting up in the morning.

26.06.2013

At 3V it’s easy to keep motivated. I just look at how most banks and big institutions in many countries treat their customers, and know people deserve better. It’s our job to try to make sure they get it.

Over the next few years, the whole landscape of consumer financial services is going to change, and we want to help drive that change. Amongst all the noise and bad news about tumbling banks and rocketing charges, there are new sorts of providers coming into the market who know better what people need, who understand the power of technology and are used to having to offer the best possible service or their customers will go elsewhere.
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Gotta sting, as the scorpion said.

06.06.2013

Suspicion was my first reaction. Who are these guys and can I trust them?

Getting approached by a competitor who wants to buy your company certainly creates emotions. But at the same time, this was exactly what we had planned for! Together with the PowerKiss Board we decided already more than a year ago that a partnership in some form was necessary for our survival. We knew that if, and when, the business of wireless charging grows big enough, we would not survive on our own.

So here I was. Facing the full process of an acquisition and may I say, without any prior experience of such a process. Emotions ran high and the uncertainty of the whole due diligence process, and its outcome, certainly made my fingers tingle.
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Join the movement and spread the love!

20.05.2013

Jolla was born out of passion. We saw that we had a chance to make something really unique, and we decided to do it although seemed crazy to many people at the time. We have proven that by being different, doing unlike things and spreading the love, we can create a world class product with enormous demand and support from the world.

I don’t think that a year ago when we started any of us knew what was ahead. Wow, what an amazing journey it has been. We have the best team EVER working on Sailfish, we have the first fantastic devices and we have all that is needed to deliver and support them. It’s not only our team of sailors – from the very beginning we had a community who believed in us and wanted the same things we do: a truly independent and open alternative in mobile. The world’s greatest community has expanded organically and the new people joining the movement make it stronger every day. We share the values of free spirit, open innovation and rebellion attitude.
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Welcome to DNA Engine blog

20.05.2013

DNA Engine blog is about the innovations that drive the market towards greater customer experiences. Our motivation to write this blog is to explore, contact and discuss openly with all the innovative companies that share the same mindset of open collaboration towards disruptive market development.

Open innovation and startup companies

We, at DNA, are convinced that, in order to serve our customers better, we have to not only excel at providing the infrastructure serving as the basis for connectivity, but we also need to support the driving forces of new service innovations. Yeah, you guessed it – these are no easy tasks to deliver. While we do have the capacity to provide the infrastructure by ourselves, we are also honest in admitting that we lack the sort of innovativeness needed for creating completely new services. This is why we want to support and form new partnerships with interesting up-and-coming companies. We look for partners that will be building the innovations of tomorrow within the ecosystems, and, at the end of the day, will benefit also our customers.
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