I went to the Billboard Digital Music Live! in Vegas on Thursday January 9th. It was a last minute adventure I knew Live Hub needed to take, that and I needed a break from walking the CES grounds at the Venetian. A couple Executives here at Live Hub graduated from music school and worked for some of the biggest players in music. It’s been a couple years since we have worked for those big guns that shall remain nameless. I know I was more than curious to see how the music executives though they stood in an industry that has been turned inside out and upside down and nearly useless.
I was surprised to hear how many people in the industry want change but don’t know how to create it. It was great to hear managers such as Gregg Latterman from Aware Records, and Terry McBride from Nettwerk Music Group want to embrace new technology and find ways to get their artists name out to the fans. I still ran into many people, who I observed as being in an older generation, that still wanted big label to help their artists. Labels are in deep trouble and everyone on each panel knew this and stated the same. One panel member even stated that 2008 is the year, meaning something has to change or the industry will be sunk.
Scary thought, LIVE NATION trying to merge live music concerts and published music into their business model. Do we really want a huge entity such as Live Nation controlling the music? I know I don’t. The thing that was very clear is that no one is clear. There is no standardization in the industry. It is easy to be an illegal music company than to be a legal one. For example, we have to jump through hoops to get licenses for music on Live Hub. It’s not easy, we get licenses but it doesn’t buy you all the rights. You’re confused, so am I. Then labels and certain entities would love to hand you content from their artists but they want lots of money in return. For a company like Live Hub, we give your artists exposure to a large audience, maybe I should charge you just for putting your artists name on my site? Not that I would because this company was formed to help the artists, not try and get lots of money out of them.
Lets look at a company that is suffering because the industry can’t come together and make things easier for B2B Transactions. Pandora, is in my opinion the best internet radio out there! I have been listening to Pandora for quite a while now and head over heals for their service. Their service is FREE, it’s another great company that is in the discovery game for fans and artists. Yet, Pandora is going to have to pay back royalties and a high 2.7% percent royalty (I believe that’s the number Tom Said). It may not sound high but when you think about how they only make income from advertising, and as Tom pointed out they will be operating at a loss by paying out the high royalty rate why can’t someone cut breaks for music discovery companies? Internet radio is going to die with such high royalties that have to be paid out.Where is the standardized licensing and publishing practices? Why does everything have to be on a base by base case. No wonder why the industry is so far behind. I am glad I went to the conference even though nothing was resolved, but more light was brought to the topics that are really hurting the industry.