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Jim DeRogatis

SXSW Dispatch #5: On Transparency and Disruption, the New Words to Live By

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AUSTIN—If there were two buzz words repeated more than any others at the music-industry panels I caught at the Austin Convention Center during South by Southwest 2016, they were “transparency” and “disruption.” And both loomed large on Friday.

The call for transparency is one whose volume is growing deafening from artists, managers, and “creators,” as the techies like to say (the latter term a bit less insulting than the old “content providers”).

Meanwhile, the urge for disruption as applied to the music business has a less ominous tone than in many other industries—not the least of which is my old calling, print journalism, the death rattle of which grows more troubling by the hour—unless, of course, you’re one of the few diehards (like Tony Visconti during his Thursday keynote) bemoaning the looming extinction of the old major label system.

Blockchain

Trying to follow the session entitled “Fair Music: Transparency in the Music Industry” was a bit like struggling to watch a film you’ve never seen in Greek, without the benefit of subtitles, so thick was jargon like “metadata” and “blockchains.” So I’m paraphrasing here, and quoting only the few words spoken in English, but my takeaway: The United States looms far behind Europe (thanks there to a drive led by the French) in having any workable way of accurately accounting much less paying for the number of times an artist’s song is streamed on all of the many new music services.

“Nobody anticipated this level of streaming,” said Vickie Nauman, owner of CrossBorder Works, which “specializes in digital media and content strategy.” She described the current, non-workable system of identifying the millions of tracks available to listeners of streaming music as a “Frankenstein’s monster” that is, needless to say, dramatically shorting artists of their rights and incomes.

Mind you, accounting has been dubious for the sale of recorded music for as long as there has been recorded music (139 years, give or take). But if artists were routinely shortchanged during the heydays of vinyl LPs and then CDs, right now, the situation is worse than ever.

“What is the [current] market size for recorded music? We don’t even know that,” Nauman said. “We have no handle on how many people will pay for digital music” and no unified system for tracking or collecting the payments owed from streaming.

Not surprisingly, this is a situation that troubles artists’ representatives, like panelist Brian Message, who co-manages Radiohead, PJ Harvey, and Nick Cave, and who spent much of the session sadly grimacing and shaking his head. But there are rays of hope.

One is the current initiative in France, which is spreading throughout the European Union, in which the government is forcing record labels, publishers, and the streaming services by law to begrudgingly move to a unified accounting system, as recounted by panelist Sophie Goossens, a senior attorney with a French law firm.

“There is momentum,” Goossens said.

The other spots of sunshine are the possibilities presented by the aforementioned “blockchains,” shared databases that many banks are looking at to coordinate payments with bitcoins, and the concept of “digital fingerprinting,” in which every song will contain one universal code making its uses easier to track and pay for.

“The problems are actually quite solvable,” Nauman said, noting the way the many mobile phone companies came together to solve even more complicated dilemmas. What has been lacking so far in the music world are the desire and the leadership to address the situation. Neither the streaming services nor the publishers and record companies are motivated, and the artists lack the money and power.

Then, too, there’s the fact that this important panel drew a mere 20 people in a room that could have held 300. As they have been for the last century, musicians are being screwed on royalties, and most aren’t even interested enough to investigate it.

Disruption

If “streaming” was a word I’d previously thought of kindly, the panel has me reconsidering. In contrast, the session entitled “How to Build a Disruptive Music Brand” helped erase at least some of the negative connotations I’ve had toward the phrases “disruption” and “branding.”

This U.K.-centric session spent a lot of time examining the successful “bedroom to boardroom” ascensions of two British music platforms, GRM Daily, which is dedicated to spreading the word on the English urban grime scene, and AEI Media, which spreads the gospel of drum and bass. The founders of these companies said they all started out “accidentally,” because of a passion for the music, without ever having a business plan. Now, they reach millions of listeners a month.

“My passion was to help musicians make more money,” said AEI’s Luke Hood, adding that he saw the business model that existed—the old label system—“and wanted to improve upon it.”

Rare in the world of digital entrepreneurs, these gentlemen actually spoke like music lovers, which they clearly still are. That kind of disruption all of us can embrace.

Also encouraging was a session called “Bringing Out Your Fans in the Digital Age,” which actually provided a lot of helpful nuts-and-bolts information for independent musicians seeking to connect with an audience and build it from 10 to 10,000 and beyond.

To be sure, there was also some jargon here—“You have to look at your analytics,” the panelists repeated several times—but their core message for musicians was the same as it’s been since the chitlin’ circuit: connect with and respect your fans; communicate with them as much as possible, and “overserve” them by giving them as much good music as you can.

“I actually think it’s getting to be like the ’60s again, when the Beatles put out two or three albums a year,” said Daniel Kruchkow, CMO & Head of Digital Strategy for Crush Music, which works with artists such as Sia, Fall Out Boy, and Weezer. “It’s important to stay engaged.”

In that sense, at least, the more things change, the more they remain the same.

This blog’s coverage of SXSW 2016

Italian Power Trios, Texas Psychedelia And New York Shoegaze

Finding my religion and punk-rock revelations

Michelle Obama, riot grrrl

Gearing up for my 25th Spring Break in Austin

Follow me on Twitter @JimDeRogatis, join me on Facebook, and podcast or stream Sound Opinions.



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