“VR is shit! It’s shit but it doesn’t have to be. Certainly the hardware’s not all the way there yet, it’s quite bulky and if you put it on for an hour or so you’re going to get a pretty raging headache and neck ache. But the real problem is the content is shit. The music industry trying to make you go see a concert in VR is about as boring as I can imagine.”
Scott Cohen can always be relied on for plenty of quotable moments when he appears on conference stages. Warner Music Group’s chief innovation officer, recorded music, keynoted the ‘Technology, Innovation and Startups’ track at NY:LON Connect, the conference that Music Ally co-runs with the Music Business Association (Music Biz), with this year’s taking place in New York last week.
Cohen’s thoughts on VR developed on a theme he talked to Music Ally about in late 2019, complete with his anecdote about feeling fully, thrillingly immersed in a VR boxing game, but being left cold by many of the current musical VR experiences.
“I don’t want a different perspective. I don’t want to just consume it in VR. I want it to be my experience, I want to be the centre of the action. That’s what it’s about,” he said.
“Maybe I put on a VR headset and I have an AI-powered instrument that I strap on, and this AI instrument, whatever notes I play when I hold my hands there it’ll play a chord, and if I’m listening to music, it’ll play in the same key, so I cannot fuck it up!”
Cohen set this in the wider context of people’s expectations of digital entertainment. “When the web launched, 30 years ago, the idea was it was the end of people passively consuming. There used to be people that created and people that consumed,” he said.
“And little by little, yes we’ll consume, but we want to contribute. We want to put back. It’s everything from likes and shares to comments, to taking our own pictures… to today with TikTok.”
Cohen’s keynote also saw him reminisce about the early days of The Orchard, the distributor he co-founded with Richard Gottehrer 23 years ago.
“We started a digital distribution company in 1997 with two critical flaws. One was we had nothing to distribute. We had zero content! And the second was, there was nowhere to distribute to. The download store didn’t exist yet!” said Cohen.
Cohen would leave The Orchard in early 2019, and soon after announced that he was joining Warner Music in the new position of chief innovation officer, recorded music, reporting to the label group’s recorded-music boss Max Lousada.
“We created this position at the company. We didn’t create a department. We didn’t want to create an innovations department and team working on new things that’s disconnected from the rest of the company,” he said. “He didn’t hire me to play it safe. He brought me in to say those uncomfortable things and maybe make people in some departments feel uncomfortable.”
Cohen also sees his role as smoothing the next digital transition for the music industry, in contrast to the “decade or so of unrelenting pain” post-Napster, and then the tensions of the early streaming era – “After finally the music industry got their heads around digital downloads, it was like ‘Now we have to go to streaming? We just got used to 99 cents, and now we have to get used to point zero zero zero something? Fucking hell!’”
He continued: “That transition took several years until people got comfortable with it. If we get it right, we’re going to transition into the next phase, and no one will notice it.”
What technologies will that next phase involve? “I’m a huge proponent of blockchain and blockchain technology, which is probably the most misunderstood technology,” he said. “Also a big proponent of artificial intelligence both on the data side, in terms of how we’re going to find and sort and search for content when there’s 40,000 new tracks a day, but also on the creative side.”
Cohen encouraged the music industry to look at how its youngest listeners are spending their digital time.
“Old people are on Facebook, the 20 year-olds are on Instagram, and then there’s TikTok, but there’s even a generation below that. Who in the room knows Roblox?” he said. Not many hands went up.
“It’s a gaming platform for kids, and they not only play games, they create their own games and play those games with their friends. The average age there is between eight and 18. The music business is like ‘Holy shit, that’s our audience!’. There’s over 100 million monthly active users on this platform, and almost nobody in this room has ever heard of it? This is where the target audience is… This is where the kids are. Roblox. 100 million of ‘em. Who’s engaged with it?”
Cohen also offered some advice to startups about not trying to bite off more than they can chew. “Everyone wants to be that unicorn that reinvents the music industry, reinvents social media. Just pick one little thing and go deep!” he said. “There’s so many problems, often the unsexy ones are the most valuable. Like metadata. Just get really fucking good at that, and there’s a great business around that. People bite off too much.”
Cohen finished off by predicting that the current $9.99-a-month streaming models are not the end-point for the way music is discovered and listened to. He looked back: to FM radio, colour TV and the album format in the 1960s, to 8-track in the 1970s, MTV and CDs in the 1980s, and the web, iTunes, YouTube and now streaming.
“In the eighties, MTV and the CD hadn’t existed at any time before, but they completely dominated that decade,” he said. “All I’m saying is, there’s no expectation based on every other decade that the next decade will look like THIS [streaming in 2020]. It won’t look like this, and it probably won’t be the same companies… And the music itself will change, as instruments change, as AI powers different things. It is going to change dramatically.”
Cohen’s keynote was followed by a panel discussing the next wave of innovation in music and tech. Panelists included AdAge editor Brian Braiker; Twitch principal of music partnerships and operations Cindy Charles; CrossBorderWorks principal and owner Vickie Nauman; and ReedSmith partner and co-chair, global entertainment and media industry group, Greg Pryor. The moderator was MQA CEO Mike Jbara.
The conversation bounced around, it’s fair to say. One of the themes was the potential of digital platforms coming in to music from other places. Twitch, for example, which is building its music community after coming to prominence with live gaming videos.
““It’s really not a passive platform, it’s completely interactive, it’s multiplayer, you have chat on the side, the streamers interacting with their fans. We’ve created this category and celebrities around streamers, around gamers,” said Charles.
“What we’re trying to do now is think of other categories where we can recreate that experience. Gamers play for 10 hours a day, so how can we recreate that experience for artists? How can we make this a category where artists can interact with their fans, and chat.”
“We’ve explored live performances and we’ll continue to do that, but it’s not just a YouTube experience of watching the boring live concert, but really engaging and doing behind the scenes and on the tourbus. Those are just some of the ideas that we’re exploring.”
Nauman said that the recorded music industry’s return to growth, fuelled by streaming, has opened up potential around technology, innovation and startup partnerships, after past startup failures (and the surrounding chatter about licensing terms) had spooked investors.
“It became ‘Okay, that didn’t work, VCs are not going to give any more money for advances’, so there had to be different kinds of models. Once streaming took off in 2014, 2015, money started flowing, and it provided the industry with the foundation, which has really changed the dynamic around licensing. It changed the openness to new models and doing things differently,” she said.
“I’m starting to see how a lot of labels especially, not publishers so much, but labels, they’re hiring young people… to come in and help make sense and help translate to the senior executives ‘This is what’s happening out in gaming and in social and in UGC and short-form video’. They’re helping to make sense of it for the internal executives.”
“It’s a really big paradigm shift, as there are more and more people who are on the marketing and label side trying to break artists, who see platforms and new technologies as ways to reach fans in ways you just can’t do otherwise.”
Pryor, who has acted for a number of digital services and startups, agreed, with reservations.
“On the label side for sure, I agree with what Vickie was describing. There’s a curiosity that was absent when times were tough,” he said. “I think if you look at the publishing side, that’s more difficult I think in terms of the risk-taking, the way that licensing is approached. It’s more difficult because the route to monetisation if you’re a songwriter or a publisher is different.”
Nauman addressed the question of blanket licensing, acknowledging that rightsholders “are not particularly keen on letting somebody else license out their rights for them” but suggesting that the system being set up in the US with the Mechanical Licensing Collective is “a step in the right direction of providing some openness”.
Pryor hailed the potential for new kinds of streaming services, for example those targeting specific genres, like metal-focused Gimme Radio. “I’m aware of a new jazz service that will be launching purely for people that love jazz,” he added.
“It’s not so much about just services. I look at the streaming services as the olden days of radio, where it’s the foundation of how people have access to music… but I look at other things like really bespoke experiences that music is integrated into on top of other adjacent industries.”
Games are one example: Nauman works with the developers of music-VR game Beat Saber, which was recently acquired by Facebook. The game has some music that is free to play with, but then sells ‘song packs’ based on individual artists like Imagine Dragons and Panic! At The Disco.
“People are buying an incredible amount of music,” she said. “It’s about getting the user experience right. People have absolutely no problem paying for music. We pay eight dollars for a coffee, we will absolutely pay eight dollars for a song pack in a game!”
In its closing section, the panel hopped between topics. User-centric payouts came up for discussion, for example.
“The performing rights and collection societies are not supportive of it,” said Nauman. “It’s actually not hard to do for a master recording, because there’s one owner. But for publishing you’re talking about then having to manage all these little micro business models, and then slice and dice the publishing and splits even further.”
Jbara wondered whether playlists are an entirely positive trend for the music industry. “We’re making it really easy for people to come in, find the latest [tracks] and get back out,” he said.
“It depends on consumers, it depends on the space they’re in,” suggested Braiker, although Charles said playlists fulfil an important need for listeners. “It’s a passive experience… people sometimes just want a lean-back experience, so I think it’s a really positive thing. How music gets on to playlists is a whole other question…”
Nauman worried that playlists culture has made music a bit too much of a background thing for many listeners, however.
“I feel like music has almost become something that’s in the background of my life,” she said. “I don’t know who the artists are when the music is playing, I don’t know how to go deeper without picking up my phone, and I don’t necessarily want to do that. We’ve got this ubiquitous experience of music, but it’s film and gaming where I’m really immersed and I really hear the music.”
The session continued with a game of word association. Braiker was asked for his response to ‘artificial intelligence’, and talked about a meeting with Universal Music getting the label’s thoughts about smart speakers.
“It’s become more of a shared experience than the headphone experience… Families are listening to music together more… you almost see people having broader taste in music, because it’s become a more social music experience now,” he said.
Pryor got ‘blockchain’ as a prompt. “It has the ability, if leveraged and IF people adopt it in a cohesive way, it does have the potential to really make things more accurate, and ergo hopefully make people more money,” he said. “The thing that drives me insane in any licensing discussion is black box, so if there’s a way that blockchain can do that…”
The final question concerned how the music industry can make it easier for startups to innovate around it. Pryor flipped that round. “I think startups often need to be better at helping themselves. Just educating themselves about the industry if they’re going to be in it,” he said. “Sometimes the industry gets a hard time.”
Nauman continued that thread. “We oftentimes read stories in the media about startups in music and music licensing and services and whatnot, and startups read that and think because it’s in the press, it’s working,” she said.
“They see what Spotify and Apple has done and think that’s the only way of doing things… But you don’t need a full catalogue to make music do things for you.”
Charles returned to the question of publishing. “The companies that I’ve dealt with in the past, the issue is less about the labels, which are a one-stop shop for masters, but much more around the complications of music publishing,” she said. “Understanding the complexity of sync licensing and knowing whether you wanna go deep into that or not.”
Read Music Ally’s other NY:LON Connect coverage
Troy Carter talks music disruption: ‘I’d still be in a panic if I were a major label…’
The evolution of labels: ‘What’s your value proposition?’
Global music streaming: ‘We are just on the tip of the iceberg of what this will become’
Publishing and rights: ‘Everybody needs to play ball in order for this tech to work’