The rift between Taylor Swift and Spotify shows just how tough the music business is right now.
Streaming songs for a small cut just isn't as lucrative as selling an entire album.
But there's one small record label that is still thriving in the digital world. And it's doing so by satisfying a pretty important need for anyone with kids ... making baby music that's actually worth listening to.
Rockabye Baby takes songs from popular artists -- ranging from classic rock gods Led Zeppelin and The Rolling Stones to hip hop stars Eminem and Jay Z -- and turns them into soothing instrumental tracks for infants.
According to Lisa Roth, creative director for the brand's parent company CMH Label Group, Rockabye Baby has actually sold more albums (1.6 million) than individual tracks (1.3 million downloaded) since it was founded in 2006.
She added that there is about a 50-50 mix between digital sales of albums -- mostly via Apple's (AAPL) iTunes -- and CDs sold in stores. Yes, CDs. They still exist.
"The packaging is a big part of the fun," she said. "CDs still sell well because it's fun to hand people a package as a gift."
Full disclosure: I am a huge fan of this label. The Metallica and Pink Floyd albums helped me get through sleepless nights with Buzz, Jr. in late 2009/early 2010 while Rush and The Foo Fighters were frequent 3 a.m. musical companions last summer after Baby Buzz 2.0 was born.
Check out the Rockabye rendition of Radiohead's "Creep" to get a sense of how the songs sound. Very relaxing.
So when a PR person pitched a meeting with Roth, I jumped at the chance to meet her even though I don't tend to write too often about private companies.
But I won't lie. The fact that she also happens to be the sister of on-again/off-again Van Halen lead singer David Lee Roth (he's currently back with the band) sealed the deal.
Lisa Roth said the idea for the series came to her and her former CMH colleague Valerie Aiello when trying to find baby shower gifts for friends.
She found that most of the music was stuff like Barney the annoying purple dinosaur and Raffi, who was parodied in an episode of "The Simpsons" as Roofi.
"I was underwhelmed by the baby music out there," said Roth, who does not have kids. "There was nothing adult friendly."
And the cradle will rock. It took about a year to get the first three albums -- ones for Metallica, Radiohead and Coldplay -- ready. Roth said she and Aiello were looking for the "perfect balance of clunk, tinkle and attitude." There are now more than 50 albums in the series.
Roth said the artists all get paid standard royalty rates for their work and that none have complained about xylophones replacing electric guitars for the the lullaby treatment. Aerosmith lead singer Steven Tyler even wrote the liner notes for his band's Rockabye Baby album.
She added that growing up as the sister of a famous rock star made her appreciate all the hard work that musicians put into their craft. She choked up and had to fight back tears when talking about her brother.
"I watched what it took for him to get to where he is today. It was a lot harder in the world before YouTube and 'The Voice.' I have enormous respect for artists. We try and approach every album seriously," she said.
As you can probably guess, there is a Van Halen Rockabye album.
And out of respect for Roth, CMH decided to only use songs from David Lee Roth's tenure with the band. No Sammy Hagar. (Even though "Dreams" or "Right Now" could be a decent lullaby song.) And definitely nothing from the brief and disastrous Gary Cherone era.
But it took a while to get it into development. Six years, in fact.
"Mixing business with family is dicey," she said.
Might as well jump? So where will the label go next? Roth said CMH had been approached by two larger music companies interested in doing distribution deals for the Rockabye Baby series. But the company decided to remain independent.
She added that there have been talks about doing original music as well instead of just covers. But they don't want to stray too far from their roots. What's worked has been taking songs that are instantly recognizable and transforming them into something else.
As a parent, I hope the label continues to do well.
It may just be the aging Gen X-er in me worried about being forgotten in the sea of millennials and boomers. But my wife and I want our kids to at least know about (if not necessarily like) the music we grew up with.
Based on the sales of these albums, other parents of our generation must obviously agree.
But "Paradise City" by Guns N' Roses is not the smartest thing to be playing to a hungry, crying baby in the middle of the night. The Rockabye version though? That's a different story. Take me down ...
Streaming radio service Pandora may face a lot of competition. But the company is still attracting subscribers ... and advertisers.
Pandora (P) reported a quarterly loss Thursday after the bell. But sales topped forecasts thanks to an increase of 700,000 new listeners from a year ago. The stock rose as much as 13% in early trading Friday and hit a new 52-week high in the process. Although things didn't end too MOREPaul R. La Monica - May 24, 2013 4:01 PM ET
If you have an Elton John channel on Pandora (P), an appropriate song to be streamed today would be Sad Songs (Say So Much). "Guess there are times when we all need to share a little pain."
Shares of Pandora plunged more than 17% Friday following multiple reports that Apple (AAPL) was looking to launch its own streaming radio service. Fortune's Apple 2.0 blogger Philip Elmer-DeWitt has more on the radio MOREPaul R. La Monica - Sep 7, 2012 12:12 PM ET
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