Surrge Travels from Boston to Austin to Launch New Music Referral Service; Taste Makers Can Earn Serious Money

3/15/08Follow @wroush

I must be the only Web journalist who did not go to Austin, TX, for South by Southwest, the music, film, and interactive-technology festival that dominated the Twittersphere this week. But as fate would have it, I got my SXSW story anyway. It’s about a Boston startup that’s renting out the Dirty Dog Bar in downtown Austin tonight to showcase Horse Stories, Dead Sara, Eric Hutchinson, The Brobecks, Elizabeth and the Catapults, and many more of the independent artists and bands participating in its new Web music distribution service, called Surrge.

Created by serial-entrepreneur brothers Jonathan and Justin Bingham, Surrge is a combination social network and online music store where fans of new bands can earn 10 percent or more of the sale price whenever their friends buy songs based on their recommendations. Significantly more, in some cases: If you’re the first person to download a $1 song from Surrge and you convince two friends to buy it, you’ll earn back your dollar, and if you then convince 98 more friends to buy it, you’ll earn another $28.50. (I’ll explain the math in a minute.)

The basic idea behind Surrge is to accelerate the spread of new music by giving fans a way to become invested—literally—in the success of the bands they enjoy. It’s basically a big system for tracking music referrals, counting purchases, and dividing up and shuffling around the resulting micropayments. Referrers earn the aforementioned 10 percent commission, while a “scout” who gets a new band to join Surrge does even better, earning a 1-percent cut of that band’s Surrge revenues for life. (The percentages come out of Surrge’s slice of the pie, not the bands’.)

Surrge Home PageSo, that hip friend of yours who’s always putting you on to the coolest new bands? Now he can earn some cash for his trouble. “We are trying to quantify, institutionalize, and monetize word of mouth, which is really the way music spreads,” says Jonathan Bingham, who took the CEO role at Surrge; Justin is CTO. The pair, plus a small crew of programmers and other helpers, have been working on the angel-funded website behind the scenes for about a year, almost ever since the brothers’ last venture, an intrusion-detection software company called Intrusic, went out of business.

The full Surrge site, which launches today, features dozens of independent bands, including artists like Hutchinson and Dead Sara, and will be loaded with 1.2 million songs over the next couple of weeks, Jonathan Bingham says.

Of course, the irony here is that the Internet, which makes it so easy to purchase (or pirate) audio files online, is exactly what’s destroying the traditional channels for promoting and selling music in the first place—thus creating an opening for companies like Surrge to experiment with new kinds of Web-based music marketplaces. And the Binghams are hardly the only Boston-area entrepreneurs exploring this area. Tourfilter, Bandsintown, and Tourb.us help fans track performances by their favorite bands; Ourstage lets fans pick the best band-submitted videos for monthly $5,000 prizes and concert opportunities; Nimbit uses the Net to help bands sell CDs and merchandise directly to their fans; and SonicBids provides an online system matching bands with booking agents, to name just six of the more than 20 companies that make up Boston’s strong music-and-technology cluster.

Surrge could emerge as one of the most intriguing companies in this cluster, simply by virtue of … Next Page »

Wade Roush is Chief Correspondent and Editor At Large at Xconomy. You can subscribe to his Google Group or e-mail him at wroush@xconomy.com. Follow @wroush

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