MIDEM Day 3: Playlists, Blockchain and China

MIDEM Day 3: Playlists, Blockchain and China

New industry buzzwords and the vast potential of the Chinese market were recurring themes on the penultimate day of the MIDEM conference in Cannes. 

Human vs Machine: Music Curation & Playlists Are The New Battleground looked at the role of curation in today's music industry. 

"We have had music curators since we were founded in 2007 and that is something we are very proud of," said Deezer MD Alexis De Gemini. "The future of streaming is about giving the power back to the user because the more he or she can personalise Deezer, the more they will engage and the longer they will stay with us."

Music industry strategic advisor Sammy Andrews interjected: "While we definitely need to give some power back to the user we should also definitely be giving more power back to the artists. 

"Every part of our industry can benefit from the data that streaming services are generating, and some of them are not giving it out very well yet. While we're talking about all this level of data we're generating,  I hope as well as serving the user we really do start serving the artist and everyone starts joining those dots."

De Gemini agreed, pointing out that his company was developing a service called Deezer For Artists. "We want to give them more and more access to the data of their music," he said. "The more artists have information the better they will understand this new world." 

The business's buzzword of the moment, "Blockchain", was given its own session, entitled How Blockchain Can Change The Music Industry. Artist Imogen Heap, a vocal supporter of Blockchain, said: "I want [a] song to give all the information that you could possibly want to know about it, anybody wanting to do business with this song, I want them to know everything they need to know.

"I want these songs to act as a beacon of information for people to be able to grapple with in the simplest and most easy flow way possible, and to receive monies back via services that use that information, again, as frictionless as possible. So when I discovered Blockchain, I realised this was a big piece of this ecosystem that could grow from this foundation."

Vinay Gupta, of Switzerland-based Ethereum, said there were two important functions of Blockchain for the music industry. "The first is these permanent records of who did what: this person published this song, this person wrote this song, this person performed this song; having all of that information in a single universal reference point would be fantastic," he said. "The film industry did this with IMDb. If you're going to redo IMDb today, you'd do it on Blockchain because it's the natural technology of choice for doing that. 

"The second thing is the smart contract and the smart contract is basically a tiny little programme that has fixed instructions about how to move money. The technologies that are coming are wonderful for music."

Joe Conyers, of Downtown Music Publishing, added: "The last 50 Years we didn't have technology. The next 50 years it's all about technology, so might as well make the whole marketplace more efficient."


Speaking of new buzzwords, several sessions at Midem tackled the issue of "value gap". Speaking during the Copyright Summit's session "Building Sustainable Growth for the Music Industry - Addressing the Value Gap," IFPI CEO Frances Moore said the isssue came to the fore when the industry started to see growth in digital revenues, especially though the rise of subscription models for streaming music, but the most popular service to access music, YouTube, did not contribute to teh same level.

"The biggest platform is hiding in safe harbours and undervalues content," she said. For Moore, YouTube "is a content provider and should be licensed". Moore also adressed the issue of the $3bn figure that YouTube claimed to have paid rights holders. "Google has not explained that figure," said Moore. "We had a look at it and we have no indication where it comes from."

David El Sayegh, general secretary of French authors' society SACEM, said that "safe harboura are old privilege from previous century." Moore said that to fix the safe harbour situation, the indistry will need "the help of the European Commission. And in the US there is a big movement from creators against safe harbours."

During the same session, Michel Lambot, co-founder of indie powerhouse PIAS, said the issue with YouTuve was "commercial." He added, "They should pay a decent rate to rights holders. In the end it is money that should go to creators." Lambot said that personnally he would be "very happy" if YouTube's business model included a percentage on advertising revenues allocated to rights holders.

At the session on US copyright, part of the Copyright Summit, US music publisher Ralph Peer offered the following definition of the value gap: "The value gap is the distance between the rate we are receiving and the market rate."

Peer added that the issue of safe harbours needed to be addressed not only in the US but on a worldwide basis. He said that he believe that on this issue, as on many others, European and US regulators would act in tandem."The US and Europe work very close to each other and understand that they need to have strong rules around the world," said Peer. "Copyright change in EU and in the US will be interrelated."

The other buzzword at Midem was "transparency" as the new goal for the industry. But a lot falls into the transparency bucket. It can apply to data, as well as to the way collective management societies work or to the contractual relationship between the various music stakeholders as well as business practises. "Without Transparency, there is no trust and no functioning market," said Andy Heath, chairman of Beggars Music Publishing, during the Copyright Summit.

Heath added that the industry had been "suffering from many decades of opacity and practises in European societies and you could not do anything about it. It was all shrouded in mystery which is by and large all gone and the market is much healthier. Societies have make a lot of efforts and need to be perceived as a trusted source."

However, Heath added, the problem was "the absence of transparency about our biggest customer [YouTube], that does not disclose anything about their business models."

Warner Music Group's CEO, International and Global Commercial Services, Stu Bergen and president, Latin America & Iberia, Inigo Zabala gave a joint keynote interview. The duo were joined during the session by Brazilian superstar Anitta. 

 

"Success can come from anywhere," pointed out Bergen. "Artists are just as likely to show up like Anitta in Brazil as they would anywhere else, including the Anglo markets.


"We see incredible opportunity in China," he added. "China is that perfect situation where you have an improving legislative environment that is getting more protective of intellectual property."


Bergen referenced Warner's acquisition of Chinese entertainment company Gold Typhoon in 2014. "We aligned our interests with the internet giant Tencent in a landmark deal where we set out to create a rational music market in the world's most populous country," he explained. "The numbers and the reach that Tencent has are staggering - any given day they reach more people than exist in most countries."


Continuing on the far eastern theme, Gao Xiaosong, chairman of e-commerce firm Alibaba, gave the day's final keynote. Alibaba Music runs a streaming service and launched a new platform based around 'idols', Alibaba Planet, last month. 

 

"We have everything," he said. "So we are more like a big agency, and we share big data to our clients. 

 

"In the UK, United States, Europe, young people have still got their idols, but they don't have that much money to be able to support their idols. But in China we had a one child policy for more than 30 years, every family had only one child. Four grandparents, two parents, feed one child. So the young kids, the teenagers, have a lot of money to support their idols"

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