Month: May 2018

Five Reasons Why Apple Could Succeed as a Music Publisher

Music Business Worldwide reports in a fairly detailed article that Apple is launching a music publishing division–crucially based in both London and the US run by Elena Segal (recently of my old alma mater, Mitchell Silberberg).  This doesn’t necessarily mean that Apple will be competing with publishers to acquire catalogs or for songwriter talent just yet, but that is something worth thinking about.

Personally, I don’t see a catalog buy in Apple’s future.  They don’t need the money or the headache–Apple is in the Benjamin business not the Lincoln business.  If Apple moves into publishing my bet is that it will be strategic and not tactical.

But I could see a world in which Apple leveraged their creative staff and audio recording toolshed to attract developing writers.  Even a $1 million investment in a stable of developing songwriters could go a long way.

Here’s five reasons why Apple has a strategic advantage over almost everyone in getting into the creative side of the business:

1.  History:  Largely due to Steve Jobs’ genius, Apple has always attracted musicians and artists to the company’s products.  When I attended the “Hell Has Frozen Over” launch of iTunes for Windows, even a blind man could see how much the artists who Facetimed with Steve on stage really enjoyed the guy.  Remember that iTunes for Windows launched with a whole bunch of exclusive tracks from top artists–all of whom were happy to participate.  How much happier would they be to actually include Apple in their creative careers?

2.  Trust:  Apple has never been sued by songwriters or artists.  They give a straight count for iTunes.  Not to say they shouldn’t be audited, trust but verify, etc., but on balance most people trust their Apple statement not to be shady.  That is definitely not true for Spotify, or…ahem…others.  Plus, Apple doesn’t hand out stock to lower royalties for everyone.

3.  Fairness:  As an old Apple lawyer once said to me, we decide what’s fair and then we jam it down your throat.  Which sounds harsh, but remember that Apple Music’s long-time honcho Eddie Cue made a huge change in Apple Music’s launch strategy because Taylor Swift tweeted that she thought the free period was too long.  One tweet and that was that.

Eddie Cue

Contrast this exchange with billionaire Daniel Ek’s tone deaf mansplaining to the same Taylor Swift over windowing.

4.  Longevity:  In a time of ups and mostly downs in the music industry, Apple isn’t going anywhere.  There’s no fear that key executives are going to pump and dump their Apple stock on a get-rich-quick scheme that benefits everyone except the creators.  So the long term interests are aligned.

5.  Playlists:  You don’t get the impression that Apple is going to use the 21st century algorithmic equivalent of Top 40 to create a version of George Orwell’s versificator that bears about as much resemblance to a Ponzi scheme as it does to a listening experience.  Apple smartly engaged Zane Lowe & Co to keep the human element in a kind of global Radio One.  Artists don’t like to feel that they are simply part of the background music–who can get excited about being on the “Sleep” playlist?  It’s like asking artists if they’d like to sign to Muzak.

I personally find the idea of Apple in the creative side of publishing very attractive because it allows Apple to distinguish itself on values that many creators find compelling:  Transparency, integrity and trustworthiness.

Frankly, we could all do well to promote those values in our business instead of passing laws that try to make the indelible sleaze disappear.

@TXMusicOffice: Music Industry Economic Impact Study Quoted by Sen. @JohnCornyn

The good news is the bad news is wrong.  And someone has the data to prove it.

If you watched Smokey Robinson’s riviting testimony before the U.S. Senate Judiciary Committee this week, you may recall that Senator John Cornyn read some statistics from the Texas Music Office Economic Impact study on the benefits to the State of Texas from the music industry.

This one exchange should give the lie to the usual cant we hear from lobbyists both in and outside the music business that we will never win against the broadcasters on terrestrial royalties because there’s a radio station in every Congressional district.  There’s music industry in every state at least, if not every Congressional district.

The economic impact study concluded:

Combined, music business and music education directly account for over 95,000 permanent jobs, $3.6 billion in annual earnings, and just over $8.5 billion in annual economic activity, up from 92,000 jobs and about $7.5 billion in annual activity during 2015.

  • The ripple effects associated with the direct injection related to music business and music education bring the total impact (including the direct effects) to over 178,000 permanent jobs, $6.5 billion in earnings, and $19.8 billion in annual economic activity. The State of Texas also realizes over $323 million in tax revenue from these impacts.

In addition to the TMO economic impact study, you should also read Titan Music Group’s Austin Music Census that really drills down deep on the local impacts and has become a rally point for Austin musicians.

The Texas Music Office sets the gold standard for providing federal lawmakers with the information they need to defend the music industry as important job creators rather than an afterthought.

Senator Cornyn’s exchange should debunk forever the idea that there’s no support for music industry initiatives outside of New York, Nashville and Los Angeles, so nobody bothers to explain themselves to residents of flyover states.

@hypebot: @SoundExchange Launches Music Data Exchange To Connect Label, Publisher Metadata

SoundExchange’s new Music Data Exchange (MDX) is a promising idea that gets at a big part of the real problem with mass infringement of songs by digital services.  It also gives some hope of actually reducing the “pending and unmatched” (or “black box” in the vernacular) at the source–before the songs are infringed.

Regardless of what the Music Modernization Act’s proposed blanket license and new retroactive safe harbor for infringing services may do, if the song ownership data isn’t available pre-release, it is unlikely that the proposed Music Licensing Collective will result in more efficient payments to songwriters subject to the blanket license.

When I worked at A&M Records, I established a policy of enforcing requirements in producer and artist agreements that writer and publisher information (including splits) be delivered to A&R Administration along with every new recording as part of the larger label copy process.  A&R Administration then was able to send the full publisher and song metadata for the recording to the Copyright Department so that there was no need (or much less need) for them to chase down the information on new releases.  That’s not only extremely inefficient, it also makes their job exceptionally frustrating and Kafka-esque.

This required putting some sensitive English on the ball, so to speak, about enforcing our contracts with the most important people on the label–the artists and producers.  But it was a simple pitch–let’s get this right so that songwriters get paid properly.  That resonated.

This policy resulted in A&M having the lowest pending and unmatched in the industry–to the point that on audit some people thought we were hiding something.

On balance, the downside of denying the black box slush fund just didn’t compare to the upside of making sure our songwriters got paid (many of whom also were our artists).  While I’m glad that the plan worked for A&M at the time, what’s really needed in an era of massive infringement by digital services is an industry-wide solution that takes away that excuse.

Nobody likes litigation, but it has become a last resort when faced with people who just don’t seem to care and would rather buy themselves a new safe harbor than do the right thing.  MDX may offer that opportunity and solution.

Hypebot recently published an interview with SoundExchange’s Jonathan Bender that gives a clear explanation of the goals and functionality of the service.  I think it’s a solution that everyone should support.

And use.

…[I]t occurred to us that we were addressing a problem after it happened. We said, “Isn’t there a way to address the problem before it happens? Before you get to the point where you have settlements and lawsuits and unhappy writers and publishers?”

That was the core idea of Music Data Exchange – to create a centralized, rational process for labels to request publishing data and for the publishers to respond to those requests on a central site…

In one of my first meetings with one label’s copyright department I asked, “How do you get the publishing data?” They said they generate a report of all their new releases each week, typically hundreds of recordings, hand it to their copyright people, and then they commence to email publishers they know asking “is this your song?”

That’s just one label. Add hundreds of labels and hundreds of publishers to that, and thousands of recordings a week. It’s no surprise that it’s a mess.

Read the post on Hypebot.