For fans, future generations of music connoisseurs, and casual listeners alike, the way we listen and access music has changed for ever. As HMV struggles and iTunes, Soundcloud and Spotify continue their rise at the retailers’ expense, the remaining major record labels could now be purely in the business of copyright ownership.
Recordings have become impossible to keep as private property, as the Noble Prize winning American economist Paul Krugman points out. “The information that you create by producing a performance that can be digitised is very hard to appropriate.” This, coupled with the prevalence of home recording technology means that, to put it bluntly, the recording industry is screwed… leaving live performance the main revenue channel for serious artists.
Distributing music as physical recorded media may yet turn out to be a historical anomaly, and how we will sell access to music in the future is unclear. But beyond these obvious observations, what trends will set the stage for music technology in 2012? The Kernel asked four leading industry players for their views.
Co-founder and creative director, MixCloud
Winner of the TechCrunch Europas “Best Entertainment, Audio, Video, Music Startup”
What is your take on the digital music industry?
I’m co-founder and creative director of an Internet radio platform called Mixcloud, based in London.
Mixcloud’s mission is to re-think radio and connect listeners with great DJs and radio presenters. We are passionate about delivering great radio, for everyone. The site is an open platform where anyone can upload a pre-recorded radio show, mix or podcast legally for free. Listeners can choose from a huge diversity of music and talk content (which we call “Cloudcasts”), and we’ve built algorithms to help bubble up “what’s hot”.
Within the wider industry, I believe there are many different listening modes that people have when online. If you know what you want to hear, Spotify or SoundCloud are great. Mixcloud, on the other hand, is a music discovery tool, where all the Cloudcasts are curated by experts and enthusiasts. You’re never stuck with indecision or having to create a playlist.
BandCamp recently posted encouraging stats that more and more, people are paying for content they set out looking for on the web as free downloads. Is aggregation and streaming, from MixCloud’s perspective, driving artist discovery or adding to sales?
Without a doubt. We surveyed our users and the number one highlight on the site is the “ability to discover new music”.
We have teamed up with some great online music retailers so that you can purchase all your new discoveries, and recently announced a special partnership with the JunoDownload online store.
We have built a new technology into the site that identifies the song you’re listening to as you are hearing it, and gives you a direct link to purchase it easily. No more wondering “I wish I knew the name of this song, because I really like it”. The feedback so far has been very positive and we’ve had thousands of people buy music through this new feature.
MixCloud recently hosted an event (along with COADEC) to shed light on the Hargreaves Review. Can you explain a bit about what the review means to today’s music startups?
The Hargreaves review is a long overdue look at the digital economy and how the government can help encourage growth. We have participated from an early stage and submitted evidence to the review from the point of view of a start-up working within the complex music licensing space.
The review came out in May last year and highlighted 10 recommendations in such areas as copyright licensing, patents, orphan works, and enforcement. The Government accepted all 10 of the recommendations in August of last year and is in the process of running a feasibility study right now.
The most significant recommendation for music start-ups is the potential creation of a “Digital Copyright Exchange”. The current licensing situation is very complex, and our experience at MixCloud has been a very long and drawn-out process which could dramatically be improved thanks to new technologies. The DCE could function like a stock exchange, where rights could be sold and licensed, either directly or through existing collecting societies.
With strong historic cultural and creative sectors, the UK has a big incentive to pioneer a new solution for licensing in the modern digital age. If the Government gets its act together and actually implements these recommendations (unlike those of previous reviews) there is huge potential to build legal content based businesses on a well defined foundation.
Senior advisor, Creative Commons; label owner, Gold Robot Records; Wired Correspondent. Musician, Not the 1s
You’re a musician and also advise Creative Commons. What else are you involved in?
I’m a senior advisor at Creative Commons, where I develop strategy and work with artists, media companies, and cultural institutions on the use of Creative Commons copyright licenses. I’m a correspondent for Wired magazine and on the board of CASH Music. I’ve a new album, Not the 1s – Why You Cryin?, out on vinyl and digitally through Gold Robot Records.
Music-related Application Protocol Interfaces (APIs) and data repositories look set to be big in 2012, as are businesses around them. EchoNest and Decibel are two great examples. Has this changed the way musicians should approach Creative Commons licensing or the six licenses available for digital works themselves?
If you’re a musician interested in using Creative Commons licenses, the issues you should be thinking through are the same now as before. Do you want your music to be legally shared, used, and built upon by the public? If so, are there copyright rights that you’re willing to grant to the public? And if so, are there rights that you want to reserve exclusively?
The proliferation of innovative music platforms, open APIs, and the businesses that are built on top of them is exciting because it provides a variety of new opportunities for Creative Commons artists seeking the kind of exposure that our licenses can help facilitate. Take for example The Echo Nest’s recent collaboration with the Free Music Archive. Together, they made about 40,000 songs openly available to developers under Creative Commons and other permissive licenses. This is great, because developers get access to a huge catalog of high-quality music that they can legally use for their apps, and artists see their music being exposed via all sorts of new discovery, remix, and social music tools.
As a musician and label owner yourself, what tool for reaching fans excites you the most right now?
I’m excited about dozens of services and apps right now, but one of the first that comes to mind is Audiosocket, which holds promise for streamlining the process of commercial music licensing. Their technology makes it easy for artists with awesome music both to be heard and earn money, and it helps media producers by making it easy to find and license tracks. Audiosocket’s tools and catalog are used by the Vimeo Music Store, which I’m a big fan of. The Vimeo Music Store also provides access to the Free Music Archive’s collection of Creative Commons-licensed music.
Founder, Toolshed Digital Media Marketing; digital licensing representative at Merge Records.Consultant to Spotify, Independent Label Catalog Acquisition
How did you become involved in the music business?
My work in music started as a performer. After several years playing local gigs in North Carolina, I started managing bands and signed an artist – Cheralee Dillon – to the German Glitterhouse label. After signing two other bands to Beggars Banquet (the bands were June and Stella), I moved to New York in ’97 and founded the New Media department at what became the Beggars Group (XL Recordings, 4AD, Matador Records, RoughTrade). I founded my digital music consultancy, Toolshed, in 2001, and since then we’ve orchestrated over 350 digital campaigns.
Toolshed currently utilises proprietary technology to search and analyse social media platforms on behalf of clients, and we were one of the first marketing companies to service and work with bloggers. We developed a proprietary technique for serving media in the early noughties, that helped us gain a serious toehold as a new media pioneer amongst key independent and major labels, as well as with established artists.
I currently represent Beggars Group/Matador Records on the Soundexchange board, do digital music service licensing for Merge Records, continue to orchestrate blog marketing and social network micro-marketing campaigns on behalf of my favorite labels and artists, and consult for a variety of tech companies. Most recently, I helped Spotify in the area of the acquisition of independent label and artist catalogues for the 2011 launch of the service in the United States.
I’m a founding new media committee member for the American Association of Independent Music (A2IM), and am very excited to be a board member at CASH Music, which builds remarkable open source music technology for artists. I’ve also had pre-launch advisory board relationships with Tunecore, RoyaltyShare, SirGroovy, and LoudFeed.
With your background, you have worked both with successful independents and those still struggling to build a core audience. With streaming poised to become just as important as a la carte downloads (iTunes) do you advise bands differently, depending on where they are at with their audience? And how do you gauge this?
It’s true – I’m a believer in streaming music, and have been over the years in my capacity of helping labels from Kill Rock Stars, to Saddle Creek, to Touch and Go with their digital music service licensing. I think of streaming music as an ancillary revenue stream to downloads, but equally importantly, I look at streaming music as an opportunity to inject “social” into music consumption and generate money for rights-holders in the process, and that cuts across artists at all levels.
“Social” in the download space often means filesharing; in effect, that’s dividing the revenue pie each time a file is shared, the opposite of what happens with streaming music services when music is shared.
Social music is something I believe consumers want, and that’s why I believe there is a bright future for streaming music as these services scale. As mobile devices and smartphones come of age, streaming will live alongside downloads. Social music today is important to every artist, irrespective of whether they’re large or small.
There are many other elements to successful new media campaigns besides digital music streaming or download services. At the moment, Toolshed is heavily involved in what I like to call social media micro-marketing: actively searching social networks, utilising our proprietary “special sauce”, for public conversations pertinent to a particular artist, and then communicating one-to-one. Time-consuming, but very effective. Many labels or artists won’t really take the time to do this themselves; we can help. This is particularly valuable for more established artists, artists who are influential to other artists, and individuals.
If an act is less developed, we spend extensive time building that artist’s social networks, both via existing friends or followers, and via advertising, in order to create a broader platform. This can mean working on an artist’s “voice” on a social network or advising on tactics. We like to position ourselves where most publicists stop… if it involves heavy lifting, such as orchestrating a Turntable event or a Google+ hangout, we’ll be the grease that makes that cog turn for a particular project. In this sense, we’re not competition for most publicists, but rather someone who augments their efforts and who can play well with a team focused on working together to build an artist’s presence.
Producer, Metropolis Studios
As a digital music producer, you have worked with some very well-known names. Are there some you can name-check?
I’m digital media music producer at Metropolis Studios. I have produced titles for Radiohead, PJ Harvey, Arcade Fire, Muse, The Prodigy, Elbow, Andrea Bocelli, Jessie J, Feist and Darwin Deez…
Billboard recently changed their charting policy, increasing the sum a digital “album” must make to $3.49, due to fragmented marketplaces on the web and a la carte song downloads. Additionally, the overall sales of chart-topping albums are half what they were five years ago. Is it officially the age of the long tail? Who is this good news for?
It reflects the fact that the majority of folks are simply indifferent — and unfortunately apathetic — about purchasing full-length record releases now. There’s definitely a focus on individual tracks to get “the hits”. The appeal of ownership of music has dwindled completely and unfortunately it is impossible to see where sales will pick up on that front so I guess it is “the age of the long tail“. However this means that artists and labels are being more savvy in generating revenues (especially the independents who will have a larger slice of the market share) and you will see more incentives such as “bundle deals”, where fans can purchase records and tickets. This has already proved successful in boosting sales.
It has been effective, judging from acts such as Steps and Westlife, who charted well in the UK and sold out their UK tours at the same time. So have been App-related releases (see Beyonce Live at Roseland), and offering additional musical and video content via artists’ personal sites or in the iTunes LP format. All this offers a range of content to entice fans or “users” in.
Looking to music production in 2012, what new collaboration or web tools excite you?
Definitely people using their smart phones as a central part of music production and creation, with app-based instruments and recording tools. Already we have seen first-hand examples of some exciting apps in the development stages, where people can create remixes as well as manipulate sounds. That excites the geek in me. But I’m also resigned to the complete shift to the streaming and online storage culture with iCloud, Dropbox, Spotify and Soundcloud. Physical ownership will eventually die down and cease to exist. All you’ll require to play your music will be a username and password.