Music Ally

What, you may be wondering, does Google have to say for itself at MidemNet this year? David Eun is VP of content partnerships at the company, and he’s being interviewed on-stage by TAG Strategic’s Ted Cohen.

First question: “Why are you trying to screw the record labels?” Hurrah! “There is this presumption that people are part of the problem, not part of the solution,” fires back David. “The presumption that we’re trying to screw the labels is not true, obviously, and for me it’s just unproductive.”

So, he rocks the line about Google not creating its own content, but just organising other people’s. Cohen asks about YouTube traffic. “Every minute of the day we have over 15 hours of video being uploaded to YouTube,” he says. “We have hundreds and hundreds of millions of views being consumed every day, over 20 versions of YouTube around the world, and over half the videos on YouTube have some sort of comment or rating – a social interaction.”

But he stresses that Google is into partnerships with all the elements in the music industry. “We don’t make money unless our partners make money, so the idea that we would screw a partner on whom we depend is not rational or logical.” Quite.

So what is a partner? “You don’t assume that the other partner is trying to screw you, frankly,” he says. “That’s a vendor relationship. So no, we’re not screwing the labels, and if anything, we need to partner more closely with them.”

Do the labels ‘get it’ asks Cohen. “We try not to generalise too much about anything,” says Eun, straight-batting it back. “There are a lot of very smart people who really understand the challenge they face in the music industry. So yes, there are some people who do get it, and want to work very closely with us. But there are a lot of people who are still very defensive as opposed to offensive. Sorta protecting business models, protecting what they know.”

But he says there are still ways for the music industry to experiment and innovate in a way that still supports their core business of selling recorded music – he cites the YouTube buttons sending people to buy songs on Amazon as an example.

“Initial results are encouraging, but there’s a lot more we could be doing to help our partners sell music downloads, or promote album launches, or help people go and buy tickets to see the concerts. But there is a culture of ‘here’s my interests – meet them. And if you can meet them, maybe you can have access to our content’. And in that approach, there’s often not really a consideration of the other person’s business – ‘If you can’t make it work, that’s your problem’.”

His suggestion – pretty clear – is that record label defensiveness is hampering innovation, and reducing the number of possible partners.

“The intent of Google and YouTube is to be a really good partner, but there’s always room for learning and improvement,” he says. “But it starts with intent.”

How important is music to YouTube? “We are not a music service. We’re not into trying to build a destination site or trap people on the site for as long as possible and profit from it… But we know that music is very, very important to our users, it’s very popular. So we wanna be in the music business, and support that. Music is as important as any content that we offer.”

He does stress that YouTube is as much about Barack Obama’s videos, university lectures (over 100 universities around the world offer their lectures on YouTube), advice videos and so on.

Cohen asks about the concern in the music industry about respecting and protecting copyright. How does Google work with them on that. “You start by following up words with action,” says Eun, saying there was a lot of concern in recent years from copyright owners about online copyright infringement.

So, YouTube has put its various measures in place, including its Content ID technology to help copyright-holders identify infringing videos, and then decide whether to block them outright, to track what happens to that video to learn, or to allow it to go up and make money from it.

“In 90% of cases, the content owners are allowing it to stay up, and monetising it,” he says. “The people who upload videos aren’t typically intellectual property experts. They just love the music… These people would have been the presidents of your fanclubs before. So do you punish them, yell at them, block their content from going up?”

He also says that the percentage of revenues coming from UGC clips with music clips is increasing fast – labels are making decent money from taking the third option above.

Now to Trent Reznor, whose spectre is hanging large over MidemNet this weekend, even if he’s not here. “They went out to the YouTube community and said send us your content – upload content featuring our music – and they got over 2,000 entries from people who took time out of their lives to do that.”

What other examples are there of this kind of thing? YouTube developed its Insight tool, allowing partners to go through data and identify who is watching their content, when they’re watching it, where they came from, and what they enjoyed. How do you figure out who and where?

“It’s anonymised,” he says. “It’s more ‘on Mondays at 8 o’clock, these particular CBS clips tend to spike’. Or Weezer debuted one of their videos on YouTube.. and in two days they got four million views. And using Insight, they could pinpoint where people lived regionally, and where they came from on the internet to watch the video.”

So they took that geographic info and used it as part of their tour-planning process. And secondly, they got a sense of what was “really popping” within the video itself.

Another stat, the YouTube player is embedded in more than ten million pages around the Web. “It’s tools like that that will help us form a more thoughtful solution, if you will, to some of the challenges.”

So, what about Warner Music Group pulling its videos from YouTube? “First of all, I think it’s unfortunate. If you’re YouTube and about giving your users a sense of infinite choice, you wanna offer as much content as possible and have effective partnerships with your partners. But there’s no unwritten law that you have to be in a particular space or have to be partners.”

So a partnership has to work for both parties. “Unfortunately we don’t have that type of relationship with everyone, and we don’t have that kind of relationship with Warner Music right now.”

But he stresses that the music industry should “allow innovation to thrive, encourage it”. And talks about companies who were building momentum and “frankly, were suffocated, or are being now slowed down. It’s not that we don’t appreciate or understand why some things happen… but you have to iterate, you have to keep on experimenting. And unless the music industry allows that to happen, we’re still gonna be scratching our heads looking for new music solutions.”

Is control over, asks Cohen. “Yes and no. Control can’t be over if you own music. You have to have control if you’ve invested in it and built a business around it,” he replies. “In this era, it’s really about taking and allowing the content to where the eyes and ears already are, and figuring out how to make a business out of it… Allow ideas to flourish and try things. If you know you’re in the business of harvesting tomatos, allow them to grow and become ripe. Don’t just pick little green ones off the vine…”

Now, a question from the audience. If David left Google tomorrow, and found a new artist in a club that changed his life. How would he handle that career, if he had some money behind him? Interesting…

“You start with the artist and what they wanna do, what they’re capable of… beyond performing,” he says. “I don’t fully subscribe to one end of the spectrum where people say the labels are dead. I think there’s a tremendous amount of value that the labels can add. So I would actively explore what the labels can do, but I’m not sure I would want a traditional label deal… And I would explore all the platforms and technologies out there to spread the word about my artist. YouTube would certainly be one of them, but it certainly wouldn’t be the only one.”

And also, he talks about the ability to generate fans, and give them guidance without getting in their way, “they do things on their own to generate momentum for you”.

But overall, he would experiment with a lot of different distribution models, digitally. This was an interesting question, eh? Perhaps a label should hire him ;o)

Another question – can the music industry survive without physical product, and what is the greatest opportunity in all the various digital models. “Right now, the bulk of the revenues, the core business is still selling CDs, so it would be naive to just say ‘get out of the CD business’,” he says.

“But there might be a model where buying a physical CD is also buying a token of ownership of that music, which includes lots of different rights, to take that music to different devices, for example.”

And that’s a wrap.

(UPDATE: I was typing so fast, I missed the crucial ‘not’ in David’s quote saying “we’re not into trying to build a destination site or trap people on the site for as long as possible…” – I’ve put it back in now)

Tags: david eun, Google, midemnet

This entry was posted on Sunday, January 18th, 2009 at 5:43 pm and is filed under Digital Music News, midemnet. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.