Beats: The First Artist-Friendly Streaming Service In the World…

Isn’t that an oxymoron?  The question is whether an ‘artist-friendly streaming’ service can ever exist, though Beats co-cofounder Jimmy Iovine wants to create just that.  This says nothing about payouts, but everything about information, and it’s the focus of this interview between the Wall Street Journal’s Walt Mossberg and Iovine.

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Iovine: There’s also something else going on on our service that doesn’t happen anywhere.  We have to make it user-friendly for the artist, they have to be able to build businesses on it, they have to be able to have information about who’s using their music, where they are, it has to become a business for the artist instead of just communicating with their fans.

“Right now, they have all the information and the artists have no information…”

Mossberg: I’m a little confused about the last thing you said.  I certainly understand that artists and record companies could benefit from having information about what [people] want to listen to, but aren’t you going to invade their privacy by telling that information back to the artists?

Iovine: No, right now we’ve brought on Ian, Ian Rogers is the CEO of our company from Topspin —

Mossberg: Ian Rogers, yeah, used to be at Yahoo and other places—

Iovine: Right, you get him and you get Trent Reznor, and we’re going to build a communication between the fan and the artist.

Mossberg: Oh you’ll be the intermediary.

Iovine: Yeah.

Mossberg: So my personal information may not go to the artist.

Iovine: If you’re listening to them they will know. Oh yeah.

iovine_mossberg

Mossberg: You’re going to have to tell people that right up front —

Iovine: Yes, yes, they have to know—

Mossberg: And by the way, not only are you going to pay me $10 a month, but what you’re listening to is going to be communicated back to certain people—

Iovine: To the artist—

Mossberg: To the artists.

Iovine: To the artist.  I think that’s fair play.  I mean we don’t—

Mossberg: I’ve never heard of a service that does that before.

Iovine: I know that.

Mossberg: But, what if I don’t want anyone including the artist to know what I’m listening to?

Iovine: Well then I guess you’re comp’d out of that, we have to sort through that, but that’s the basic concept for the artist.  We want to do that, I mean we could fight over that all day but they need that information.

“Right now, U2 goes on tour, they sell $750 million worth of tickets, they want to know — you don’t think that Ticketmaster uses that information?”

Mossberg: I get your whole point, but I’m just saying there’s a privacy issue there, that’s all.

Iovine: Yeah, but it’s on the side of the angels and I think that stuff will get worked out.  I’m very optimistic about that, maybe I’m idealistic, but I believe we can work that out.

23 Responses

  1. @TomSSatchwell
    @TomSSatchwell

    It’s all well and good at this time saying they want to run an “artist-friendly streaming service” but unless the Beats team are completely transparent with their payouts, I don’t think they will convince many that they’re any different.

    Being able to map who is listening to what is a good piece of information and it could, in the right hands be able to help grow their ‘business’. But numerous articles containing artist feedback has shown, what artists really want is higher payouts and from the current business models Spotify & Pandora are working off that isn’t sustainable.

    Information? Yeah great but i’d prefer a thicker pay packet.
    @TomSSatchwell
    http://www.beatsontoast.wordpress.com

    Reply
    • Cameron
      Cameron

      The unfortunate reality in all this is that the likes of Spotify and Rdio are already paying top wedge to the labels. So much so that there is literally nothing in it for them in terms of profit. Their value comes in building a monolith that can be on sold.
      If the labels get a large chunk in both up front and ongoing payouts then surely the question of artist pay out and support falls back onto the labels themselves, not the service they have approved the licensing for?

      Reply
      • Tom
        Tom

        Exactly, streaming services are so bogged down with licencing label (major & indie) catalogues they can’t even imagine to turn a profit, higher payouts from them, like I said would be unsustainable.

        I just think more transparency on payouts, at all stages (service > label > artist > etc ) would be beneficial. If we can see what’s being paid, we can see the chunk that goes missing along the way.
        @TomSSatchwell

        Reply
        • Cameron
          Cameron

          Yep yep. I’m just amazed that its the streaming services copping the bad rap when it’s clearly a label issue. If the services raise their charges in an attempt to pay artists more then the labels are the ones getting fatter. Spotify and the like will never publish payout stats simply because it’d be biting the hand that feeds…..albeit crumbs 😉 The bars been set now though so the model needs to somehow adapt its billing methods in order to be sustainable.

          Reply
  2. Casey
    Casey

    That’s great… assuming people actually want their personal information shared with artists. Which many won’t. And this does nothing to address the serious concerns, such as payouts.

    Another DOA service.

    Reply
  3. Moron
    Moron

    Do you want to know why companies like Sony, BMG, UMG, WMG when they all attempted to make creations like Pressplay and Musicnet, they were utter failures? Because of the inane, rambling jibber-jabber of guys like Jimmy Iovine. He has no idea what he is doing. He thinks he can slap Ian rogers on top of this creation he has in his head, push some fancy playlists that Trent Reznor makes, pay the artists the same that Spotify, Rhapsody and Rdio do, and somehow be viewed as a savior and the major labels will annoint him and Daisy god?
    There’s a reason Spotify and Rdio are successful (or in Rdio’s case, not sucessful but an amazing product on the web and my android app), because they understand technology and user experience.
    The majors will not care one bit about Daisy. They care about iTunes. Until Spotify or anyone else generates more $ than iTunes, you’re lucky if the majors will simply license you. anything else is gravy.

    Reply
  4. JC
    JC

    Wow, that was an embarrassing interview for Iovine and Beats.
    Wonder if they’ll let Iovine do more interviews or make a change on that.

    wrg to sharing data with the Artists, I’m doubtful that it can be done effectively.

    1. Beats probably cannot share PII (personally identifiable information) or else fans will leave in droves when artists start stalking them.
    2. If they can’t share PII, then the value and actionability of the data becomes questionable. Sure, you could use geo density to route a tour – but artists and managers can already get some of that data from a variety of sources. So this would be ‘nice’ additional data, but not game changing.

    As others have said before, being ‘artist friendly’ is going to come down to the payout rates. And the market is dictating that those stay very very low for streaming. The whole model is in question, and I have a hard time believing that Daisy, as it appears to be envisioned, will do anything to change that.

    Reply
  5. P
    P

    I don’t see what the privacy issue is here. The company/artists are offering a service and then using the relevant user information as market research. Companies have been doing this since they’ve existed.
    Amazon does this when it has recommendations for you… Microsoft does this to make their software better… Ben and Jerry’s does it to make popular flavors of ice cream… etc etc etc..
    I think people just get all up in arms when privacy and music get brough up at the same time because a lot of people still think music should be free for everyone, and “hey if I’m paying 10 bucks a month to stream whatever I want, whenever I want (which is a hell of a deal), then they shouldn’t be able to have my info!”. Well, that’s bogus, because even Facebook pages offer insight to page creator; as do websites for musicians such as bandzoogle.
    Once music consumers realize that music is a product like anything else they buy on a daily basis, then I feel this will all be behind us. If artists want to give their music away for free, they will. If they don’t want to, then you have the choice to buy it or not. This includes subscribing to a service like this. If you want a luxury streaming service, then you have to buy into all ends of the user agreement, which it sounds like includes sharing your browsing info to artists. All it will do is make the service better for you.

    Reply
    • Big Swifty
      Big Swifty

      It depends on how personal the personal information is.
      Tracking pages visited with a cookie is one thing, forwarding name and email addresses is another.
      I could imagine a setup where if you want to stream with personal information attached you pay x amount; stream without personal information attached will be x plus 5 amount.
      People can be convinced to give up all sorts of information if they think it is coming from their favorite artist. The trick is convincing the unsuspecting fan/consumer into believing the artist is personally receiving the info and not the recording/publishing company that is using the data.
      Finally, since a large portion of the target demographic is under the age of 18, you will hear much hand wringing and screaming “Won’t anyone think of the children!” That will be a big hurdle to overcome.

      Reply
  6. zogg
    zogg

    After re-reading this piece and watching the interview I sense all kinds of red flags flying. Who benifits the artist,the record company, management,publishers this just seems like another business to cut into the artist share of the pie? Besides the privacy issues ,most subscription services as well as I -tunes have more data on the listener or the artist then you can imagine.
    Jimmy Iovine is smart enough to know what the record companys want since he’s works for Universal and he also is well aware who controls the pipeline so far I hear nothing new here.
    Why doesn’t he do as Neil Young and try to benifit the public/artist and bring the quality of sound recordings as they were ment to be heard. His previous life was as a engineer/producer.

    Reply
  7. Jeff Robinson
    Jeff Robinson

    Mossberg: Oh you’ll be the intermediary.
    Iovine: Yeah.

    The industry has been founded with gatekeepers, why would Iovine’s new business be any different?

    No thanks.

    Reply
  8. hippydog
    hippydog

    Quote “they have to be able to build businesses on it, they have to be able to have information about who’s using their music”
    and the benefit to the artists is? …..
    OK, I realize there are some benefits to this information, but it is NOT a game changer..
    and if used incorrectly it could backfire very badly..
    I REALLY dont see on why they think its a big deal.. I especially dont see artists screaming from the rooftops for this?
    Either they have a plan that they are not revealing (or I dont understand) or this venture is gonna go down as something amazingly stupid.. (where people will be saying “what were they thinking?”)

    Reply
  9. Been There... Know Better
    Been There... Know Better

    There are two Jimmy Iovines…
    One is on the side of the Angels, the Artists…
    The other is on the side of the Demons… the Power Brokers of the Music Business
    Both are extremely talented and successful… seek out the former, but heed and fear the latter.

    Reply
    • Jeff Robinson
      Jeff Robinson

      He has to deal with the reality of the industry- although this Beats concept is ‘Pie in the sky’. You don’t become CEO of a major record label without accepting and working with certain realities of the industry at large. That doesn’t make him responsible for those realities, but he might be culpable for allowing things to continue. Can one man change an industry? Steve Jobs did. Jimmy ain’t Steve Jobs.

      Reply
  10. Simplyme
    Simplyme

    This makes me laugh, topspin is old news. Artists can work with them directly without the savior of music’s help. Privacy doesn’t exist anymore. Needless to say, new business model…nope, just in a different package to smell like a flower.
    Labels (UMG – Iovine’s old hood & sucked up EMI, SonyBMG, Warner) controls 75% of the recorded music = license fees to stream = $$
    Publishing = license fees to stream = $$
    PRO = $$
    Distribution Deal (UMG, SonyBMG, Warner) = $$
    manager = $$
    PR firm = $$
    booking agent = $$
    music attorney = $$
    artist = .00000001 (for one clicked stream of one song)
    So what exactly is going to change? Oh, that the artist knows you’re listening….cool *sarcasm*

    Reply
  11. RDIO USER
    RDIO USER

    i was under the impression this info was already available to the labels.. when i stream on rdio my user gets added to the users that recently played this song, so the info is avialble to everyoen on rdio, are you telling me the label doesn’t see this information?
    seems like this information should be avialalbe to the label/publisher/right holders? it wouldn’t be a privacy issue in my opinion if all they’re seeing is a ‘user’ and not my name, home address, billing info and email.
    however, if the label really wanted to engage their fans, they might be able to communicate to the user via the service. rdio already does this when they add new music from artists in my collection, they send me a message to say ‘hey we added new music from artists in your collection’ why not tell me about other events related to the artists ? shows , releases, tv appearances? (i’d check a box to get that info for sure)

    Reply
    • rdio user
      rdio user

      Yeah, that is a pretty cool feature of rdio, the number of times a record has streamed and all the users that have played it and have the songs on playlists.

      Reply
  12. Visitor
    Visitor

    “On the side of the angels”

    With was the same excuse used by the banks when they demanded a bailout.

    Iovine can go to hell with Lloyd Blankfein. If he even winds up buying a piece of my favorite streeaming service, I’ll cease paying them.

    Reply

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