New Music Seminar – Day 1 Recap
by Francis Bea
Our own Francis Bea was on hand to cover the first day of panels at New Music Seminar at Webster Hall in New York City.
Music Blogs
We first visited a panel comprised of major players in the music blogging world. Moderating the panel, “Music Blogs: Discovering the Best New Music” was Bill Werde of Billboard, with panelists Christopher J. Kaskie (President, Pitchfork), Matthew Perpetua (Founder, Fluxblog), Daniel Petruzzi, (President, Okayplayer), and Anthony Volodkin, (CEO, The Hype Machine).
Pitchfork built its brand on music journalism and focused on emerging music. Kaskie did have an observation to add. “Criticism is being marginalized.”
The publication in its early days branched off its publication by developing its own video channel named, Pitchfork.TV.
Pitchfork.TV was an innovative platform when it first came out, but since then, CPMs for video have been on the rise. To grow the channel to where it is today, Pitchfork has concentrated on its product first and foremost, and spent much of their money in the early days to create great content.
As a result of its focuses on journalism and quality content, the publication has been careful with aligning itself with brands that were seeking to tap Pitchfork’s audience of indie music lovers. In many instances, Kaskie revealed, Pitchfork has turned away from money to avoid diluting its image from aligning with a brand that did not align with Pitchfork’s vision.
Volodkin of Hype Machine discussed its mobile app, which is currently not monetized. The other panelists agreed that they haven’t quite figured out their mobile strategy. HypeM’s Web presence on the other hand is monetized through advertising.
Okayplayer will publish anything that they desire, and has only on a few occasions had to take down content at the behest of an artist or record label. This is possibly due to Okayplayer primarily featuring musicians that are not typically mainstream and simply looking to get their music out there.
Okayplayer has typically waded through the noise of music and determined what it should feature through its network of publicists. Pitchfork and Fluxblog, on the other hand, rely on peers to suggest music. “It’s becoming playlist overload,” Kaskie said. At the end of the day, Pitchfork is just as likely to cover Kanye West as they are an unknown band.
NMS Intensive: 9 Strategies to Maximize Artist Revenues in the Age of Facebook and Spotify
Tony van Veen (CEO, Disc Makers & CD Baby), shot off nine points in an 18-minute intensive talk about digitally maximizing artist revenue.
- Be where the people are – Know who your demographic is and seek them out.
- Build your list – Create an e-mail list using services including MailChimp, HostBaby, FanBridge, and then offer an incentive to your list to maintain engagement.
- Retain mindshare – Don’t let your list forget about you by keeping your followers engaged.
- Sell it yourself – Figure out how to maximize your margins, build a website and Facebook page, spend a few dollars to bid on your own band’s name using Google Adwords, and finally sell your gigs.
- Focus on iTunes – 77.4 percent of CDBaby’s revenue was garnered from iTunes sales.
- Build a deep product catalogue – Sell products including t-shirts, stickers and other merchandise to open the doors to earn more revenue.
- Embrace “free” – Offer your work for free on streaming services as a promotional vehicle to get your music out into the market.
- Tell customers what to do – Customers like to be told what to buy, where to go and what to do. You can ask your fans to purchase merchandise on stage, through your website or via email.
- Offer incentives and specials – Customers love purchasing bundle and specials. In addition, “name your own price” is an effective strategy for distributing and selling your music.
Breakthrough Trends in the New Music Business
Moderating this data intensive panel was Jay Frank, (Founder, CEO DigSin). Panelists included Bryan Calhoun (VP New Media & External Affairs, SoundExchange), Russ Crupnick (Senior VP & Senior Industry Analyst, NPD), Josh Friedlander (VP Strategic Data Analysis, RIAA), Gregory Mead (Co-Founder, Musicmetric), Chris Muratore (VP Merchant Services and Emerging Growth, Nielsen Entertainment), and Alex White (Co-Founder & CEO), Next Big Sound
The panel began with a brief mention of Adele, whose single “Rolling in the Deep” sold over 11 million copies in 2011, which was the most of any single song.
RIAA statistics
Today, it’s taking much longer for a musician’s single to peak – around 9 to 18 months. For example, Carly Rae Jepsen took 9 months to break out in the mainstream scene. Her single, “Call Me Maybe” was released in September 2011 and peaked in June 2012. Gotye released his single, “Somebody That I Used to Know” in July 2011 and peaked in May 2012.
Further figures revealed that 44 percent of the market was digital singles, while digital performance royalties was the fastest growing component in the industry. Overall music consumption is at an all time high.
In 2012, 30 billion transactions and activities were captured from customers, including 700 million streams and 1.3 billion downloads this year. Streaming is growing by 30 percent this year.
CD album sales are still 60 percent of all albums sold and the physical format is in fact still strong.
Next Big Sound’s new feature
Next Big Sound’s Alex White revealed a new tool that his company was working on. Using 210 artists, NBS has been working to build a prediction engine based on current sales and social media sentiment to predict future sales. He added that Wikipedia traffic has been a reputable source to discern future sales.
Torrenting’s impact on the music industry
Gregory Mead of Musicmetric dove into a discussion on the prevalence and effect of BitTorrent.
- 1 million active BitTorrents currently exist.
- 200 million are downloading music this year on BitTorrent.
- 2 billion music files were traded in 2012.
- 10 percent of Americans use anonymous VPNs.
- The United States makes up to 22 percent of music file sharing.
- 60 percent of torrent downloads are done by 40 percent of users.
BitTorrent downloads in the United States are actually decreasing, and Mead claims that downloads are correlated to sales. Torrents actually helped musicians garner a Web presence and following.
Digital radio’s growth
Soundexchange revealed statistics surrounding radio’s prevalence in the music industry. First, Calhoun revealed that 44 percent of Americans owned a smartphone.
17 percent of Americans listened to online radio in their cars by connecting their mobile phones in 2011. This figure has increased by 6 percent since 2010.
Digital radio has been able to monetize its business and approaches the rate of monetization per user that terrestrial radio garners today.
White added that radio is in fact still the number one driver of track sales, and the number of hours spent listening to radio has grown from six hours per week to nine hours per week.
Opportunity in the iPod Touch and mobile apps
Russ Crupnick of NPD finished up the panel with the revelation that the most popular device among children is the iPod Touch.
He also provided some interesting stats about app usage by 12 to 14 year-old children:
- 77 percent of children use apps for games
- 50 percent for music
- 49 percent for social
- 46 percent for silly/fun
- 25 percent for book
Music Labels The Businesses Formerly Known as “Record Companies”
Moderating this panel was Amaechi Uzoigwe (Head of Content & Business Affairs, Official.fm). Panelists included Stephen Bryan (EVP Digital Strategy & Business, Warner Music Group), Charles Caldas, (CEO, Merlin, UK), Benjy Grinberg (President, Rostrum Music), Brett Gurewitz (Founder & CEO, Epitaph Records), Dennis Kooker (President, Global Digital Business and US Sales), Sony Music Entertainment, Martin Mills (Founder, Beggars Group), Patrick Moxey (President, Ultra Records), and Jon Vanhala (SVP Digital & New Business, Island Def Jam, Motown/Universal Republic – Universal Music Group).
Ultra Records has branched off into distributing its music videos through YouTube. Thus far, Ultra garners 100 million views per month and nets seven figures in advertising revenues alone.
Furthering the discussion regarding technology, the panelists discussed how music crosses borders and exposes people throughout the world to music. The speed at which this is accomplished today was impossible just two decades ago. This has offered labels an opportunity for business development and distribution overseas. What should be kept in mind however is the fact that the way music is handled and the market will vary country by country or even city by city. For example, the promotion of an event overseas may require promoters that are native to the country that a label may be looking to penetrate.
Overall, the panelists are bullish about the music industry. More people are paying for music consumption, but in retrospect, monetizing music is becoming increasingly difficult and the cost of music is decreasing.
NMS Intensive: Kickstarter: Amanda Palmer’s Kickstarter Million and What We Can Learn From It
Yancey Strickler, co-founder of Kickstarter, discussed in detail the statistics behind Amanda Palmer’s successful Kickstarter project during a 20 minute presentation.
- Her initial funding goal was $100,000, but she reached that goal in a mere six hours.
- By the end of the Kickstarter campaign, Palmer had pre-sold 23,383 albums, just under 7,000 albums shy of her last album’s final sales.
- Palmer netted $16.25 per album (approximately $15 after fees).
- $560,000 of her sales was from album pre-sales.
- $507,000 was netted for experiences (gig sales).
- She booked 41 shows, which equates to approximately $41,300 per show.
- Approximately $300,000 of the revenue came from within Kickstarter, while $900,000 came from external links including promotions via social media and blog posts publicizing her campaign.
