First impressions: more panels, more sponsors, more schmoozability, and the impressive new addition of an elevator pitch event. The coffee is strong, and the day looks promising. More to come...
9:20am - Music in Audio Video Works
Regardless of your business model, everyone agrees that it takes a long time for artists to get paid online. Zahavah Levine, Chief Counsel for YouTube, still introduces herself as she did last year: she spends most of her time untangling the mess of licensing, rights management and DMCA compliance issues that are a result of YouTube's widespread popularity. Because the interests of various rights holders are so fragmented, and users are able to upload copyrighted material so easily, Levine's job keeps her very busy. And that is unlikely to change anytime soon.
"We have all these digital tools," says Josh Wattles of deviantART, who equates the computer to "the Swiss Army knife of copyright infringement." Even the most unsuspecting of online messages is subject to a number of complicated copyright logistics. With the newfound popularity of Twitter, for instance, Wattles explained that "Aston Kutcher owns all of his twits." I think he meant "tweets," but we got the message.
The lawsuit filed by EFF on behalf of a Pennsylvania mother who was sued by Universal Music Group is just one example of the pitfalls of a digital rights paradigm in which "fair use" is too narrowly defined. I mean, what kind of world do we live in if you can't upload silly baby videos on YouTube because the Super Bowl's on in the background? Isn't that why YouTube was created in the first place?
The problem is that with audio video recordings, there is a synchronization right, but no compulsory mechanical license. "If we want to license the millions of copyright owners on YouTube," says Levine, "we have to contact millions of publishers, and we don't know who they are." She suggests that a blanket license covering all of these copyright considerations would solve the problem, a perspective echoed by a number of panelists.
"Content is fragmented all over the place," says Iain Scholnick of ImageSpan. The company attempts to find a solution to this by automating the process of digital licensing. "Most content companies come into a kind of negative calculus, they hit a wall. The monetization doesn't add up."
"I wish there was a fix to this in sight," adds Levine. "But I think we're going to have to stick with this for the foreseeable future. Pots of money are being left on the table, because this is so complicated people can't pay out."
10:30am - Doing Deals
Cecily Mak of RealNetworks introduced the panel, who then introduced the single resounding theme of the session: Doing deals with the majors is difficult. Very, very difficult.
"There's progress in the types of deals that labels are willing to do," says Larry Kenswil of Loeb & Loeb. "But it's still major tooth surgery getting them to do it."
Leron Rodgers of Hewitt & Rogers believes that a surcharge for internet access to online music content will create a viable revenue stream for the majors that would counteract the effects of piracy. But will users pay $5 per month to ASCAP for free access to online libraries, just to avoid the unlikely event of a RIAA lawsuit? Rodgers claims that the financials do add up, and his Atlanta-based firm plans to release the numbers in an upcoming study.
In theory, I imagine such a plan would work. However, since if it were opt-in, what incentive is there to pay, as opposed to continuing P2P downloads for free? The threat of lawsuit would have to increase for the plan to have any teeth. And what if your favorite band (like the Beatles) refuses to provide any kind of blanket license? How many publishers have to be on board before the idea becomes viable?
Could the answer then be a compulsary payment for internet access? That might anger consumers who have no affinity for downloading free music. But tracking levels of music consumption per user would raise privacy issues. In any case, it's a thorny issue.
It would be great to see a plan that is widely accepted by consumers, coupled with a willingness of rights holders to accept a flat-fee license for all forms of music consumption. Is it likely? We'll have to tune into MusicTech '10 to see if the idea gets traction.
1pm - New Technologies Demonstrations
Shortly after the morning's welcoming remarks by MusicTech Executive Producer, Brian Zisk, we were given a demo of the web portal Zannel, which provides customized aggregation and syndication services. I tried it out (you can log in through Twitter) and found a user friendly platform for multimedia tweets integrated into a customized iPhone app. But it occurred to me that, perhaps, my band isn't quite interesting enough to have our own app. For the unknown artist, it seems rather presumptuous to be hyper-posting to fans (a.k.a. friends and family) with the expectation that someone is actually watching. Still, I like the aggregation of media that Zannel provides--and I'm a sucker for a cool app.
Welcoming us to the 1pm tech demo was moderator Meliza Solan, who introduced herself and launched suddenly into an unaccompanied rendition of the National Anthem. Not knowing exactly what to do, we stood and watched awkwardly while she sang. "Hoooome of the brave" still hung in the air when she downshifted into a breathless description of her Twitter app. Admittedly, I was too dazed to take notes on her pitch. But here's a summary of everything that followed:
LittleShoot - File sharing integrated in your web browser. Adam Fisk gives us a demo, using a generic search term and scrolling through the results. "Let's go for 'Walking in the Sun.'" says Fisk. "No, that's an M4a. It's probably copyrighted." The crowd laughs. He continues to scroll. "Let's see. Hmm. No, that's copyrighted too."
SoundCloud - Collaboration tool and distribution channel for digital music. The widget based distribution and sharing functions are targeted to artists, labels and distributors as a direct-to-fans integrated marketing solution.
drop.io - A tool for privately sharing files and collaborating in real time. Sound familiar? Content aggregators of one kind or another are emerging everywhere, and as an independent musician the prospect of sending all content through one portal sounds enticing. But how are these ideas going to overcome the licensing pitfalls without widespread adoption and monetization by the major labels?
An audience member finally asks: "Do you get a lot of uploaded content that is copyrighted?" It's the question we've all been wondering. "The answer--um, well, there are two answers--" says drop.io's Sam Lessin. "The first answer is, 'we don't know.'" Everyone chuckled knowingly as he went on to explain the arms length policy of his company, while at the same time expecting users to report P2P copyright infringements on their own. It remains to be seen if the RIAA will set their sights on these content aggregators, which seem to be newer and cooler versions of the Pirate Bay. I hope these business models can be legitimized. But it's still going to depend on licensing. Needless to say, there is a radically different tone between the attorneys downstairs and the idea people upstairs.
Band Metrics - Data analysis and aggrigation of massive amounts of data about bands. This back office application provides analytics through a dashboard interface. The demo went through the band metrics for Dave Matthews Band. I have to say, it's great that DMB can check their stats, but most unknown musicians don't want to be reminded in a hundred different ways that nobody's visited their myspace page for two weeks. If that weren't enough, each band's page gives them a "band strength" score that looks like a low credit rating, along with a thermostat reading of your "hotness." It looks like a useful tool if you're making it, but could be bad for self-esteem if not.
The Echo Nest - A music intelligence platform for user-generated reviews. This music discovery tool works interactively with other web platforms such as Spotify to find music recommendations. It looks a lot like Pandora, without the website. Hopefully, it will arrive onshore in the near future, but the outlook is spotty.
2pm - Recording Studio of the Future
Digital or analog? Fader switch or mouse and keyboard? The panel is split on whether artists can be as creative inside of a computer screen as they are with an acoustic guitar. My belief, echoed by Justin Frankel of Cockos, is that computers are just another tool for creativity. But right now, the tactile purists dominate the conversation. I've always regarded a mouse pointer to be a perfectly adequate paintbrush, but I suspect that the tactile purists are also partial to the high margin hardware interfaces they're selling.
The question that's not being asked is how can the average musician afford any of this gear? I sat on my hands, not wanting to ask the question during the panel. But I'll ask it here: how about an open source model? It seems to be the third rail of the software industry. My thought is that a free, open source licensing relationship could have a profit sharing provision included so that if the musician wins, the software provider wins, too, with a percentage of revenues.
3:30pm - The Future of Music
...in 60 minutes or less.
"Context is king," says Terry McBride of Nettwerk Music Group, playing off the old Sumner Redstone quote. "What's going to happen in the next 18 months is going to change how music is consumed entirely. Cloud based servers will pull content down to your mobile device. That is your future. You can debate everything else you want to. It's moot. The kids are already going there. The music industry gets one more chance to get it right."
But how do artists get paid? Music licensing will have to change, for one thing, but will customers pay? And will the majors play ball?
Moderator Heather Rafter of RafterMarsh USA evoked a provocative quote from Davide Bowie's recent interview with the Times:
"Music itself is going to become like running water or electricity [...] So it's like, just take advantage of these last few years because none of this is ever going to happen again. You'd better be prepared for doing a lot of touring because that's really the only unique situation that's going to be left. It's terribly exciting. But on the other hand it doesn't matter if you think it's exciting or not; it's what's going to happen.''
4:45pm - Monetization: Idealism in Practice
Fred Von Lohmann of EFF supports blanket licensing as a path toward monetization, and the idea is finally gaining some traction with the mainstays of the industry. "At least the labels aren't calling us communists any more," Von Lohmann jokes. But the point is salient. Choruss, which recently received backing (in theory) by three major record labels, promises one such pathway to monetization.
As the day has progressed, more and more panelists have been mentioning that nebulous "musician's middle class," but discussion has been light on how the unknown artist actually arrives at such a utopian scenario as quitting the day job. Is there a viable DIY model for writing, rehearsing, recording, promoting and distributing music that truly levels the playing field for grassroots musicians? Clearly not.
For the unknown artist, the only monetization that matters is in winning the attention economy. The economics of finance and accounting will always favor the majors due to economies of scale. But attention is fractured, and those DIY artists who manage to pull the pieces together will be rewarded with wider and wider audiences. Attention alone is not going to pay the bills, but it seems to be the one and only ticket for the DIY artist to become a self-made entrepreneur.
Once the blanket licensing agreements happen sometime in the future, the starving artists who managed to scrape together 50,000 fans will find instant monetization of their attention economy credits. Is it enough to put the kids through college? Probably not. But we're all riding on the hope that we'll we be able to spend more time on music and less time tweeting.
