Pay Audio
Something Xtra
When DMX Europe was forced into liquidation, its founder Jerold Rubinstein would not be beaten. Alexander Hast spoke to him about the latest venture out of the Rubinstein fold, Xtra Music.
DMX Europe is no more - that is for sure. But hot on the heels of its demise is the launch of another premium audio package, run by the founder of DMX, Jerold Rubinstein. For the Xtra Music service, Rubinstein has stuck to the original DMX format of a series of continuous music channels covering up to 100 different genres and sub-genres, and in the US he has sold DMX to TCI.
Xtra Music - which basically is Jerold Rubinstein - owns the rights to all the music channels in the US DMX package for broadcast in Europe and is keen to use them as soon as possible. The first announcement was supposed to be made at the Ifa consumer electronics exhibition in Berlin. Unfortunately not all the negotiations were completed by this time, and so Rubinstein had to wait.
C&SEu: What is the Status of DMX in Europe and in The US?
Rubinstein: DMX Inc in the US was merged into TCI Music, a company owned TCI. It is now a subsidiary of TCI. In the process of working out the sale to TCI, it was not interested in seeing DMX Europe develop any further. It felt the resources were better directed towards other projects. I worked out an arrangement, whereby I would have the rights to the music and I would bring it over to Europe at my :expense and then distribute it my way. DMX Europe has been closed and the signal that had previously been available went off the air. I took it over and I will bring it over the same way again, with a transatlantic satellite.
The Astra subcarrier leases that DMX Europe had were leases of DMX Europe which were made void. So what I had to do, was put together my own satellitespace segment, which I have been busy doing. Now I can put the music back onto Astra, and I hope to have that done in October or November. At first I thought I could make it by early September, but the negotiations did not go as easy as I hoped they would.
When DMX stopped sending the signal to Astra, they were carrying 56 channels in the ADR system. We will start off with about 40 channels but we plan to take it to 90 channels. People in Europe will be introduced to new music as well as encouraged to listen to existing channels they have heard in the past. We have a lot of music that DMX subscribers in Europe have never had the opportunity to hear. And I think that some of the better music is available on the DMX-system.
I'm very proud of the music genres that we put together, in the way we programmed it. Only a part of the menu has been offered. I feel that people in Europe have been cheated, and they don't know what my original vision was. It was never meant to be piecemeal, it was meant to be offered as a full bouquet.
C&SEu: Why are you starting Xtra Music in Germany first?
Rubinstein: Because Germany has been the market with the highest penetration for DMX Europe. The tuners, the hardware - they are all in place. But when we go back on air, the first channels that we will put up will be picked with the European market much more in mind, than specific markets such as Germany."
C&SEu: How do you see the role of BSkyB in the music market?
Rubinstein: BSkyB is important in the UK. And the UK is important in the European music scene. But one of the problems that I do envisage with BSkyB's involvement in the near term, is that it will actually be penalised by having such a large developed analogue base.
Next year, it will start to market its digital package in a different orbital slot, so its current subscribers won't be eased into it gently. They will actually have to change their dish position and then make an additional purchase. So that whole base will be exposed to a music carriage slowly. I think that presents an opportunity for us to sell in the established base of BSkyB, either through BSkyB or separately, because it is the dish that is important.
Eventually, yes, I do think its digital package will be very important, and of course I'd like to be a part of it, as long as it is going to be a set price and not treated as a giveaway part of the package.
C&SEu: But BSkyB seems to have chosen Music Choice Europe...
Rubinstein: I think that Music Choice really thinks of
itself as the beneficiary of DMX going out of business and
believes that 
this has given it an
opportunity to get the contracts which it couldn't get in the
first place. I wish Music Choice well, though they have a
different approach to things.
Xtra Music has the benefit of knowing and learning from some of the mistakes made by its predecessor, DMX Europe. I don't begrudge a competitor getting into this business, but are they going to be able to offer 90 channels through BSkyB? I don't really think so.
C&SEu: A group of people and companies in Germany wanted to save DMX Europe. Are they going to take part in the new Xtra Music anyhow?
Rubinstein: It has been a very interesting experience. I was one of the people who emotionally
wanted to save DMX Europe. As a businessman, I can only say that there was probably too much baggage to save it and still have a good moving forward position. But emotionally I wanted to save it probably more than anybody.
Some of the people who came around to see if they wanted to be involved in trying to save DMX Europe, came to the conclusion that the deal that I needed to make was not really attractive, because of the problems of DMX Europe. When DMX Europe went off the air, it was just amazing to me, the number of people who weren't interested before, called me with a great deal of interest. They liked Xtra Music, they liked the concept of it and they loved the music that DMX only partially presented to the European audience.
I wouldn't be a bit surprised if some of the people you are referring to - and some of the people you don't even know about - were to play a role in the future of Xtra Music. As to who they will be and how they will play that role - it is obviously too early to discuss. But I am totally committed to financing that with my resources, whether or not anybody else plays a role.
One of the things I've learned over the years is that when you have a vision, sometimes you have to invest in that vision before other people get the vision. Fundraising is not my principal activity. I've committed my resources and luckily my resources are enough to take Xtra Music to the right place. I've built the offices we are sitting in, so I can sit here and direct it and go wherever I have to be, to do it. This is my principal activity, this is my principal investment and I am a very stubborn guy.
"I emotionally wanted to save DMX
Europe"
(Photographs: Alexander Hast)
CABLE AND SATELLITE EUROPE OCTOBER NINETEEN NINETY SEVEN Pages 63/64