September 7, 2017:Facebook VP: ‘We understand and respect the value of all artists’

What is Facebook’s music-licensing strategy going to be? It’s one of the big music-industry questions of 2017, and earlier this week, Bloomberg suggested that the strategy will start with paying ‘hundreds of millions’ of dollars to labels and publishers to cover music used in videos uploaded to the social network by its users.

In a case of fortuitous timing, Facebook’s VP EMEA Nicola Mendelsohn delivered the guest keynote at British industry body the BPI’s annual general meeting today in London. Would she spill the beans on Facebook’s licensing plans? Of course she wouldn’t. Instead, she presented a broader picture of Facebook’s view of the music world.

Mendelsohn praised British music as “one of our greatest cultural exports” while hailing “the men and the women who drive this industry”, referring to her work as the chair of the UK’s Creative Industries Council – a role that sits alongside her job at Facebook.

“Music has always been an important part of my life. I grew up in Manchester,” she continued. “My education was definitely spent on nights dancing in the Hacienda… I’d go there three times a week… and see bands like The Smiths, New Order and the Happy Mondays.”

What about Facebook? “What’s really interesting to me… is how the progress in the music industry has always been entwined with the advances in technology,” said Mendelsohn, running from gramophones (“the Victorian equivalent of Spotify“) to Sony’s Walkman and Apple’s iPod, which she noted tended to focus on solo listening.

“That social element was still missing. And emotions and experiences are all the more real when they’re shared,” said Mendelsohn, pitching social platforms like Facebook as having the ability to bring the social element back to music listening.

She added that “there are 880 million people who have liked a music-related page on Facebook. We’re a global platform. Music’s everywhere, and so are we” while hailing the way artists are embracing Facebook’s live-video features.

“More and more artists are using live video on Facebook and Instagram to connect with their fans. Already a fifth of videos on Facebook are live, and they get 10 times more comments than other video,” said Mendelsohn.

She also talked about Facebook’s development of tools for artists to promote their tours. “We’re testing a feature to allow the event admins to more easily share multiple Facebook events together as a series or a tour. And it’s thanks to feedback from artists that we can make updates like this,” she said.

Mendelsohn talked briefly about Facebook’s copyright-protection efforts, but avoided the issue of licensing.

“We also understand and respect the value of all artists,” said Mendelsohn, pointing to Facebook’s development of a copyright-protection system to fulfil the same role that Content ID does for YouTube.

“We have a global team in place that quickly removes content in response to IP reports, and this is happening 24 hours a day, seven days a week, and typically within hours of the warning… But even with all of this, collaboration with rightsholders is key to building and enhancing these tools,” she said.

Mendelsohn ran through more artists, from Gorillaz launching 360 videos to Olly Murs communicating with fans via a messaging bot, while also noting that 76 million people watched the recent Manchester charity gig, following the terrorist attack at an Ariana Grande concert in the city.

“As technology improves, and the experience of music feels even more social, maybe one day we’ll get back to how it felt on those heady nights at the Hacienda,” she concluded. “That’s a vision for our future that I’d like to see, and one that we can only build together.”

The costs of that construction? Details on that will doubtless come another day…

BPI boss Geoff Taylor followed Mendelsohn with his own keynote, hot on the heels of the BPI announcing record-breaking figures for British music exports in 2016 – £365m to be precise – as well as celebrating its part in the legal pursuit and shutdown of stream-ripping site YouTube-MP3.

“The fact that Facebook are here talking to us about the importance of music on their platform illustrates what an exciting time it is to be in the music industry,” said Taylor.

“The potential for recorded-music means that it attracts attention not just from Mark Zuckerberg, but from other tech titans,” he said, citing Amazon’s Jeff Bezos and Tesla’s Elon Musk as examples. “They’re taking time out from inventing the space-tourism industry to have their own streaming services!” he said.

“We’re still light-years behind where we were even 15 years ago in terms of the scale of our business, and we have a huge amount of work to do,” warned Taylor. “Maximising our growth is going to mean overcoming a number of important challenges.”

First: “The existing generation of streaming services cannot be the final frontier… we need different kinds of services offering different experiences,” said Taylor, citing hi-res audio and video, augmented and virtual reality technologies as examples.

“We should be using artificial intelligence to help us communicate with more fans and personalise their experience more,” he added, with connected cars and smart speakers also on the BPI’s agenda.

Challenge two: “We’re going to continue to face strong global competition in the streaming era,” he said, referring to British music competing with American artists and emerging Latin American stars for slots on the prominent playlists of the streaming services.

“We’re holding up pretty well, but we can expect to face more of a challenge… but the reverse of that, we have a global opportunity. When we discover a great British artist, we can break them around the world.”

Taylor called for the British government to do more to help tackle piracy, and hailed the impact of the BPI’s deal with search engines (via the British government) to speed up the process by which piracy sites are demoted in their rankings. “We now see no sites with more than 10,000 [takedown] notices appearing near the top of search,” he said. “Dealing with piracy has to be a top government policy.”

Taylor also talked about the ‘value gap’. “Lyor Cohen says we’re obsessed with it. Well, I think with good reason… there’s a genuine issue that needs to be sorted out. Google’s own research suggests there are hundreds of millions of pounds lost from the UK music industry due to YouTube,” he claimed.

Another challenge: Brexit, and the potential impact on British music companies’ IP protection and market access overseas, with the BPI pushing the government to consider this as part of its trade negotiations.

Finally, BPI chairman Ged Doherty talked about the music body’s efforts around diversity, including an upcoming Brits-branded apprenticeship scheme, urging the industry to continue its efforts to open up to a wider range of young people.

Stuart Dredge
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