World over well known magazine ‘The Economist’ talks about German capitol Berlin considered as a hub for music and video technology companies

Berlin is emerging as a hub for music technology companies trying to dramatically change the way we make and listen to music …

[Taken from MORE INTELLIGENT LIFE]

When Richie Hawtin, a Canadian electronic musician and DJ, did a live set in Berlin using just two iPads, he was not just demonstrating the lightening hand speed and progressive sounds that have made him famous. He was showcasing how he has been able to push back musical boundaries by embracing technological tools created and invented in the city. These creations are now beginning to influence the music industry at large.

Hawtin, who was playing a set using software programmes on two iPads which mimic a DJ’s two sets of decks, is one of a growing band of artists and music exiles who use the vibrancy and freedom of Berlin as fuel for their work. “I needed somewhere that was inspiring and where there were like-minded musicians and artists, somewhere you could still experiment with music and with life. Berlin is so liberal in so many different ways; there’s an amazing club scene, there’s a great development software tech scene, there are so many resources here,” says Hawtin.

At a time when big record labels are hemorrhaging cash, Berlin’s nascent music technology start-ups have created a blueprint for what the music industry of the future could look like. Instead of viewing the internet and digital technology as threats, these companies are using it all to create “a new paradigm, a new construct in the way people use music,” says Mark Mulligan, a music industry analyst who helps oversee consumer-product strategy in the London office of Forrester Research, a leading global technology and market research company.

SoundCloud is one such innovative company. A Berlin-based online social network for musicians, it has accumulated 1.3m artists and record labels—including Kylie Minogue, Domino Records, Zero 7 and Snoop Dogg—since it launched in October 2008. “We now have hundreds of users from major record labels all over the world,” says Alexander Ljung, the company’s co-founder and CEO (pictured, above). SoundCloud enables file-sharing between users, and Ljung says that record labels are using it to distribute music to journalists.

Mulligan envisions platforms like SoundCloud playing an important role in the not too distant future, when music will be seamlessly distributed via iPhone apps and social-networking sites such as Facebook. Listeners will be able to create their own music mashups and share them with friends.

When Ljung and Eric Wahlforss dreamt up their idea for SoundCloud in 2007, the Swedish pair decided Berlin was the place to get it started. (They visited the German capital briefly, and decided to set up shop the following week.) Ljung says this decision was influenced by the fact that Berlin had already established itself as a hub for music-technology companies, such as Ableton and Native Instruments, both of which create software and some hardware for musicians.

The companies that are “not struggling like crazy at the moment” tend to be those that are making tools that help people make music, says Ljung. “You are seeing more people than ever actually involved in making music. This is the really unique growing area.”

Daniel Haver, the head of Native Instruments, describes his business as a “quintessentially Berlinish company”. Fifteen years ago, Native Instruments began in a small home office. Now it is a multi-million euro company employing about 250 people, in a nascent business district known as Spree riverfront in Kreuzberg.

“If you look back at the history of Berlin, back to the ‘20s and ‘30s and before, it has always been a music city, a place of great creativity,” Haver says. “We always collaborate closely with people involved in the city’s electronic-music scene to gather and refine ideas.”

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