Music Marketing

Posted By Rick Goetz on July 6th, 2013

A blog for musicians and music industry people. It is a free educational resource and it is also the way I advertise my music consulting services. I am an entertainment professional with deep roots in the music industry. Throughout my music career I have been a major label A&R representative, a music supervisor, an artist manager, a reality show producer, a bass player and the head of a digital record label.


Posts Tagged ‘Songs Music Publishing’

Songs and the Music Publishing Market Part I

Posted By Rick Goetz on September 26th, 2014

This interview was originally published in July, 2011.


Matt Pincus is the founder and CEO of Songs Music Publishing,  a New York City- and L.A.-based music publishing company. Matt got his start in the music industry playing in hardcore bands in the 1980s, touring and recording with Judge an influential New York hardcore band signed to Revelation Records. Matt got his start in the music business interning and being a college rep for several major labels, including Atlantic and East West Records. After college, he founded and indie record label called Some Records, which he ran for several years before deciding to get an MBA from Columbia University. Before he founded Songs in 2004, Matt was also a Strategy Associate at EMI Group.


Songs’ writers include Q-Tip, Brian Lee (Lady Gaga), Dev (JLS, Newboyz) Andrew McMahon (Jack’s Mannequin), Conor Oberst (Bright Eyes), Lorde and Jose Gonzalez. Songs also publishes and administers a wide variety of catalog copyrights, including a 50% share of the Pharrell Williams catalog, which includes “Hollaback Girl” (Gwen Stefani) and “Hot in Here” (Nelly) and the catalogs of Living Colour, Das EFX, Stryper, among others. Additionally, Matt serves on the board of  the National Music Publishers’ Association (NMPA) and a member of the ASCAP Board of Review.



Recently, I got to talk to Matt about how he got into the music industry, the evolution of his company, the publishing market in general and the synchronization license climate.


Musician Coaching:


Thanks so much for taking the time out to talk, Matt. How did you get involved in music publishing?




I played in hardcore bands in the 80s. My band, Judge, had a deal with Revelation Records and went out on tour a couple times and sold a fair amount of records in that scene. I wasn’t in a very good musician; the guys I played music with were much more talented than I was. But that got me interested in the business. When the band broke up, the other guys kept doing it, and I went to college. When I was in college, I was either a college rep or an intern at record labels throughout my college experience. I interned at and was a college rep for Atlantic and also interned at East West Records. I got to know the business a little bit that way.


When I graduated from college, I was working at a magazine. And a couple of my friends who went onto play music and signed with major labels – Walter Schreifels from Quicksand and Sammy Siegler who ended up being in the band CIV – wanted to start a record label, so I did that with them. I was the “business guy.” I did that full-time for about four or five years. We had some success. We had some records that sold in the tens of thousands and we had a couple bands we sold off to major labels and made some money doing that. But it was a tough living in  a lot of ways. At one point I started an internet business to supplement the income, back when that was a good thing to do in about 1998. We plugged concert tickets and chat rooms on the internet for SFX Entertainment and plugged features and content items for Spin magazine. We ended up doing some work for the advertising agencies. It was a good little business.


But when the internet bubble burst, that whole business went away in short order. I looked at my life and said, “I don’t think I want to go back into the independent record business.” I ended up deciding to go to business school, and got into Columbia Business School and went and got an MBA. Coming out of there, I got a job at EMI. I worked for a couple of McKinsey consultants at EMI that restructured the business. They basically realigned the business globally, and I worked on that. I was pulled out of their group to work on the Warner Music acquisition attempt in 2003. When Time Warner was selling the company, EMI was one of the bidders. My job was to coordinate what they call the HSR filing, which is the regulatory filing for the merger. So, I was the U.S. guy they sent around to all the different business units in the company to get all the information required in order to undertake the transaction. It was a really interesting job, because I got to see the manufacturing business and the Delaware accounting people and the pricing people in L.A., and then deal with all the marketing and  promotion people and the various labels they owned. I really got a 360-degree tour of the business in a very short period of time.


While I was working on the deal , I worked a lot on EMI’s music publishing business. EMI was the number one publishing company in the world at that time, so that was a big focus of the regulatory concern with combining the two companies. One of the things that popped out at me was that between 2003 and 2004, EMI was pulling out a significant amount of its budget to sign developing writers. And there were plenty of natural reasons for that. They were going to be the subject of  a big transaction either as a buyer or a seller and the business was getting shaky, so they were interested in cash flow. Putting out $100,000 to a developing rock band on a publishing deal wasn’t a great way for them to solve their biggest problem. I took that part away in my head and started thinking about it, and said, “If EMI as the global leader has taken that position, Universal is getting ready to buy Bertelsmann, Bertelsmann is getting ready to sell itself, Sony is combining its record side; they’re probably all in that similar position.”


And this was in early 2004. At the time, there were a bunch of companies in the record business that were taking a hedge fund and private equity money and going out and buying old catalogs – the Nirvana catalog, Trio/Quartet, all this kind of stuff – for twice what the average historical price had been for these things. They were paying twenty-times earnings or more in a market that historically paid probably between seven and thirteen times. I looked at that and I thought it just didn’t make any sense. You have to raise hundreds of millions of dollars to do that, and then you’re stuck paying over full price for whatever you buy. So, I decided to focus on writers, because the majors weren’t in that business at the time, and all these catalog rollup companies didn’t care about new stuff.


While I was at EMI, after the Warner deal fell apart, I was interviewing for jobs there, but my boss had been fired. I didn’t have a whole lot to do. I started looking at the developing writer and music publisher market in the United States and found a bunch of deals. In April of 2004, I left my job at EMI and started doing publishing deals. A few months after I started the company I hired Ron Perry – who handles  A&R here – , and he started attacking the market. A lot of the initial deals were close to where I came from; the first four or  five deals we did were either punk or metal. That was good for a number of reasons:  I knew the people involved; they sold a lot of records, so in most cases there were good mechanical royalties in the pipeline. It also trained me to deal with really challenging repertoire, creatively speaking Selling a metal song to an advertising agency is really difficult. We all got trained to work really hard on adding value to songs that weren’t easy to add value to as a publisher.


That’s where Songs came from. As it’s grown over time, we’ve had a couple key acquisitions that led us into different directions. We started with punk and metal stuff:  We did Ted Leo, Murder by Death and a band called Every Time I Die, Further Seems Forever, etc. And then we signed Chiodos, which was a band that we picked up on a modest deal, because the record had just come out. And then the record blew up and sold 400,000 records. That was a big deal for us. Then I had cash flow, so I started looking at some bigger stuff.


Musician Coaching:


Ron has probably done more publishing deals than most guys twice his age.




Yeah. That’s 100% true. He’s probably done 150 of them.


Musician Coaching:


That’s the amount most major publishers get in their entire careers. It’s a lot for someone who’s just in his early 30s.




For sure. And that allowed our company to develop in a particular way. We had these writer deals that were touchstones. Chiodos was an early one. Then Andrew McMahon (Something Corporate / Jack’s Mannequin) was a big signing for us. It’s almost hard to believe, but at the time, a guy like Andrew McMahon wasn’t attracting top attention from major publishers. He had offers, but at the time it was a different market. Andrew had an offer from a couple majors, but he signed with us. That brought us into another pocket. All of a sudden guys with really general interest music careers saw us as guys that could steward their publishing. He was a big one, and the Old 97’s was a big one, because they were really out of genre for us. Even Andrew was connected to the punk/emo/hardcore scene a little bit. The Old 97’s was totally out of that. We signed Rhett Miller first, and then had a good relationship with him and picked up the rest of the guys. That got us into the alt-country business. And then we were just a more diversified business.


Q-Tip was another big one for us. He was super credible, had lots of good will and fans around the business. He was with a major publisher for a long time. The majors just aren’t particularly geared to roll up their sleeves and work with somebody like Q-Tip. We looked at him and thought, “Not only does he have a legendary reputation, but he’s an  incredible talent and is great in the studio.” To us he represented an opportunity to really go to town on his stuff. He’s writing with everybody now. We even have him in with MGMT. He has Kanye West and Jay-Z’s new single on their split record. He’s even producing Esperanza Spalding’s new record. He gets a lot of his own work, but we’re out there opening up doors for him while he’s opening doors for himself.


Musician Coaching:


It sounds like you started your company in a moment in time when people were still adhering to a model that just wasn’t updating quickly enough. And records were still selling, so you were able to start a company with mid-sized artists and really monetize their catalogs better than a giant company could.




That’s absolutely right. There was a big middle market when we started. It would be very hard to start our business now. When we started, there were 50,000 – 100,000-album sellers all over the market. When we first started, we had 85 potential acquisitions that were north of 50,000 albums sold in the U.S. that weren’t published. Now, that market has gone away, because the retail has collapsed. The 50,000-album sellers are now 15,000-album sellers, which makes it harder to do a publishing deal. It’s not really great for the writer, because they’re not getting a lot of money. And it’s not really great for us, because we have to do the same level of work for less money in the pipeline. It would be very hard now to build a business on the same foundation we built ours on originally. We were lucky with timing.


We attacked that middle market, and there was a lot of that business when we started. It’s changed a lot. The bottom of the market has gone away. The majors are swimming at the mouth of the river a little more than they used to, because their world is changing too. The music publishing market is heavily skewed towards performance royalties lately, because radio is where the money is. And there’s less inventory on the radio play lists. So, it’s more money chasing fewer deals. We’ve been able to hold our edge well because we have great relationships with the writer community and we have a great synchronization business. An early investment of ours was bringing in Carianne Brown, our head of creative licensing, who has been with us since 2006 and is an extraordinary talent.


Musician Coaching:


Are you finding that the sync business is just saturated with people willing to give their music away for less and less? How has that business changed?




It’s changed a lot. The middle has gone away there too. When we were in the early-middle development of our arc thus far, we were doing tremendous business with indie rock bands that didn’t sell a lot of records. In the early days of the company, majors were getting $10-15k in a network TV 30-second use for a placement of a recognizable song,. We’d get about 9k for licensing these somewhat known indie rock bands for the same use. Now that business has largely gone away in television. They’re looking for MySpace bands, recognizable songs or stuff that’s working right now. For example, we have Sleigh Bells. Those guys get a lot for business on TV, in ads, and everywhere else because they are a big hit in the indie community and have lots of buzz around them.



Musician Coaching;


What I can’t figure out is that advertisers don’t seem to care about re-purposing. If something is in a car commercial, as long as it’s not in another car commercial, you’ll find it in an iTunes commercial and then in a commercial for a movie. In the dawn of sync – which I think of as Led Zeppelin in the Cadillac commercial or early iTunes commercials – people would look for music that no one else was using.




There’s much more of a herd mentality in the synchronization licensing market than there used to be. They do want category exclusivity frequently. But the synchronization market has its own hit spectrum that is different from the radio hit spectrum. You look at bands like the Heavy, the Ting Tings, The Black Keys; this isn’t stuff you would hear a few years ago in tons of commercials. Now, you’re talking about  middle-six figures, to upwards of a million dollars in synchronization income per album with any of those acts. The two-fold cause for this is that advertisers care more about music than they used to, and writers and artists are more willing to license than they were before. Sleigh Bells, which is in that category, works very well to picture, and is very hard to replace. There’s nothing that sounds like it. What’s interesting about the Sleigh Bells record is that there are parts that have a real melodic sing-song quality. When you hear the album, the music really packs a punch. When you extract certain parts from it, it soars with melody. It’s a very unique property, so they get referenced all the time. People will say, “We want something that sounds like Sleigh Bells.” It’s hard to get, and it’s buzzing, so it’s  a synchronization hit. That’s great business. We’ve invested heavily in looking at stuff like that.


The synchronization market works in a particular way, and I think what people think from the outside is that anything  that is big elsewhere is also big in sync. That’s not true. It’s relatively uncorrelated. When you look at our top sync earners, it’s not the same as our Top 10 overall writers.


Musician Coaching:


It must be really weird being known for 30 seconds or less of your entire musical output.




Yeah. Every musician has a different point of view about synchronization, and we get that. One of the things we do when we sign a writer is spend a lot of time talking to them about what they will  and won’t do. You have to get approval from the writers on most of the deals we have. We want that to be efficient. The more we can understand what they want to do, the better off we’re going to be in terms of being able to connect the dots quickly. That’s the whole point of the music publishing business where it stands now. It’s not the kind of business anymore that it had the reputation of being for years and years, where you’d buy a song, sit back and smoke a cigar and collect the money. It doesn’t work that way anymore. You need to be out there working really hard for all the people that are your constituents, and that means your writers, music supervisors, writers’ representatives and to some degree the labels on the other side of your songs.


We work really actively to provide a service level in almost a concierge-y way. This is particularly true with respect to music supervisors, who are inundated with music being pitched to them. Yes, you have millions of MySpace bands that sound like this or that, but somebody has to go through it all if you want a license them. So, this is where Carianne Brown, Ashley Bearfield and Jason Karlfeld, who are our licensing people, come in and do a lot of work to present music to a music supervisor based on the personal relationship they have with the person and the understanding they have of the way the person does their work. They spend a lot of time both understanding what kind of music to give each music supervisor and also how they each likes to receive music. Some people like to only get emails, some people still like CDs, some people only like to get pitched in meetings. It’s a real relationship business, and you have to understand the music supervisor and your own writer. The worst nightmare is being in a situation where something is locked in a national advertising campaign, and all of a sudden you find out the writer is not happy and wants to kill the deal. We need to understand the sensitivities of the writers – and they’re creative people that have their own ideas – in order to figure out a way we can make the process most efficient. People have really different opinions about that kind of stuff.


To learn more about Matt Pincus, his publishing company and its roster of artists, you can visit the Songs website. Stay tuned for Part II of this interview, in which Matt gives some advice for artists, songwriters and producers looking into publishing deals and discusses his views on the future of the publishing business.

Vevo, Noel Gallagher and the RIAA News February 11, 2012

Posted By Rick Goetz on February 11th, 2012

Last week, Vevo’s real benefit to artists and the music industry was called into question by music publisher Matt Pincus amidst news of its revenue boom in 2011. And Noel Gallagher and music industry experts weighed in on the factors that lead some popular bands to quickly fade into obscurity. Also, the president of the Recording Industry Association of America (RIAA) criticized Wikipedia and Google for their part in taking down SOPA and PIPA.



2011: A Boom for Vevo and Major Labels, a Bane for Indie Artists and Publishers


The thriving online video service Vevo – which provides about 40% of the content streamed on YouTube — earned $150-million in revenue in 2011, causing many to be hopeful about the future of music video monetization and another potential area that could rebound in the music industry. However, according to a piece written by Matt Pincus, the founder and CEO of the independent publishing firm Songs Music Publishing and published on The Wrap,  independent artists and publishers have yet to see a dime, and it is time for everyone to rethink what is fair.


As Pincus pointed out, what isn’t being said about Vevo’s boom is that despite this $150-million gain, most independent publishers and their songwriters have not ever been paid by Vevo. He says this is because major record labels have stated they have the right to license songs to Vevo on publishers’ behalf, stating that if they are paid, they will take on the responsibility of passing money onto publishers in the same way they do with revenue from tracks on iTunes. But in the case of Vevo money, they have failed to actually come through on that promise.


According to Pincus, record companies are able to get away with this because of the “Controlled Composition Clause” that is within their artists’ recording contracts that usually features unclear language and applies to songs that are written specifically for artists’ records and “controlled” by the artist as well as producers, co-writers, etc. This clause claims to give labels a free sync license that allows them to use music videos that feature the “controlled” songs for promotional uses (uses that don’t bring the labels direct payments). The language was originally added in order to cover videos shown on MTV, but now labels are able to use it to avoid paying indie publishers for videos aired on streaming music sites like Vevo.


Pincus’ article noted that the purpose of videos has changed significantly since the early MTV days, when labels were not paid by broadcasters. Now, videos represent a very real source of revenue for labels, which calls into question the idea of giving labels the right to manage licenses with Vevo for controlled songs. (Incidentally, Songs Music Publishing represents over 300 songwriters, many of which are recording artists. And none of the Controlled Composition Clauses these Songs songwriters have grant a free license to labels for Vevo videos.)


Pincus concluded that labels are not actually legally sanctioned to issue a gratis license for videos featuring songs that are not controlled, whether to Vevo and other streaming sites or to any other entity. When there is no contract between a label and a songwriter, music video rights cannot be granted to the label. And while the case settled between the National Music Publishers Association and YouTube last year finally gave independent publishers some much-deserved net ad revenue from YouTube, Vevo was somehow left out of this decision.


So, as Pincus asked, “Are record companies to blame for relying on shoddy language to withhold royalties, or is it Vevo’s responsibility to insure that the songwriters that helped it pull in $150 million this year share in their success?”


Noel Gallagher and the Industry, on Adele and Why Artists “Fall off Cliffs”


Singer/songwriter Noel Gallagher recently told the Mail that, despite Adele’s huge success the past few years, he predicts she – like so many other female artists before her – will have a short shelf life:  “I feel sorry for girls in the music industry. They do have a very short shelf life. For instance, Duffy: who? Gone. She was massive. And I don’t doubt for a second that the same thing will happen to Adele.”


While Gallagher expressed his belief that female artists have a shorter career trajectory than male artists, a music industry lawyer interviewed by The Guardian stated the situation is not unique to women; wildly popular artists on both side of the gender line often fizzle out, and often with good reason:  “Duffy is an interesting case … because her story applies to a lot of artists. Buoyed by success, they immediately think, ‘Why am I giving 6% of record royalties, a third of my publishing and a 20% management commission to other people? I am a genius! I will do it myself!'” And this thinking is what led Duffy to leave her record label, manager and her producer, who had co-written and performed on a majority of her platinum-selling album. As the lawyer pointed out, artists that fall out of the spotlight often go on to make “a bad record without any guidance from professionals. And then they wonder why it’s all gone wrong.”


The article “When bands fall off cliffs,” written by Rob Fitzpatrick in October, 2011 explored the many reasons for the “band collapse syndrome” and pointed out that a lot of bands and artists that have exploded onto the scene and received critical acclaim have faded away in the 2000s, citing examples including the Kaiser Chiefs, MGMT and Glasvegas.


Interestingly enough, when approached by The Guardian to discuss how it feels for record sales to drop, none of the bands discussed in the article would comment, likely, as the Fitzpatrick speculated, because “admitting a failure is tantamount in the eyes of the music industry to condemning yourself for ever,” but also possibly because the artist is typically the last one to realize it’s over. However, an unnamed A&R rep for a label put it this way:  “Well, I’ll tell you precisely what it feels like … It feels shit. But the second album by every single band I’ve ever signed has flopped miserably, and no one really understands why. When you sign a band, everyone at the label is very excited, but as soon as it starts going wrong every bastard runs to the hills and the A&R man is the only one left.”


Wikipedia and Google Targeted by RIAA President


Wikipedia and Google are in charge of the future of how copyrights, infringement and anti-piracy legislation is handled, according to an op-ed piece written by RIAA president Cary Sherman in The New York Times on February 7. In his critique, Sherman called out the guilty parties and blamed them for sinking SOPA and PIPA, each of which he sees as a solid and well-balanced piece of legislation.


As Sherman stated – and what became the center of his argument, “Misinformation may be a dirty trick, but it works …Wikipedia, Google, and others manufactured controversy by unfairly equating SOPA with censorship.”


He added that policy makers were not going into the process of working out this new legislation without considering all sides of the argument or with the intent of promoting censorship or anti-constitutional values, or to further cripple the already ailing music industry:  “Policy makers had recognized a constitutional (and economic) imperative to protect American property from theft, to shield consumers from counterfeit products and fraud, and to combat foreign criminals who exploit technology to steal American ingenuity and jobs. They knew that music sales in the United States are less than half of what they were in 1999, when the file-sharing site Napster emerged, and that direct employment in the industry had fallen by more than half since then, to less than 10,000. They studied the problem in all its dimensions, through multiple hearings.”


Sherman pointed the finger at Wikipedia founder Jimmy Wales for riling up the under-informed masses to protest, creating a “digital tsunami” that stopped legislation that on many levels could have been a positive step towards bringing more money to artists and creators and taking it away from undeserving parties. He asked, about the “11th hour” shutdown of the legislation, “Was this the result of democracy, or demagoguery?”


And Sherman continued his argument by pointing out that Wikipedia and Google’s rallying – “as two of the world’s most popular Web sites” – was an “abuse of trust and a misuse of power:”  “When Wikipedia and Google purport to be neutral sources of information, but then exploit their stature to present information that is not only not neutral but affirmatively incomplete and misleading, they are duping their users into accepting as truth what are merely self-serving political declarations.”


And finally, Sherman presented a rallying cry/call to action of his own:  “Perhaps this is naïve, but I’d like to believe that the companies that opposed SOPA and PIPA will now feel some responsibility to help come up with constructive alternatives. Virtually every opponent acknowledged that the problem of counterfeiting and piracy is real and damaging. It is no longer acceptable just to say no …We all share the goal of a safe and legal Internet. We need reason, not rhetoric, in discussing how to achieve it.”

Songs and the Music Publishing Market Part II

Posted By Rick Goetz on July 28th, 2011

Matt Pincus is the founder and CEO of Songs Music Publishing,  a New York City- and L.A.-based publishing firm. In Part I of this interview, Matt talked about his history in the music industry and the evolution of Songs, the publishing industry and synchronization licensing. In Part II, Matt delivers some advice for artists, songwriters and producers who are interested in going after publishing deals and offers some projections about where he thinks the publishing industry is headed in the future.



Musician Coaching:


What advice would you give somebody who wants to get a publishing deal these days? I know most publishers don’t do as many pure, “for love” deals anymore. But what describes an attractive acquisition for you?




I’ll speak first about an artist, and then about a writer/producer, because it’s different.


With an artist, the biggest advice I would give to someone who is interested in a publishing deal is to make sure you take custody of your numbers. You need to know how your music is selling, how many tickets you’re selling in which markets, what your sync licensing history is and put that together in a spreadsheet or a Word document. Really track your numbers. When we look at a deal, because it’s a singles market now, we look at numbers. Let’s say a song gets on alternative radio. The first thing we do is see if people are reacting. If you look at SoundScan and see something is moving a certain amount of singles,  that’s great. You can also look at the radio charts and see that it’s climbing in a particular format. But what you really want to see if the record is playing on the radio is if people are buying it in places it’s being played on the radio. That shows it’s reactive. As an artist, you need to know stuff like that. It used to be that if you had a little movement on SoundScan, you’d get offered a deal on spec. It doesn’t really happen that way anymore. Somebody in your camp, or in your representation’s camp needs to be pulling together all the information about your career across the various places where there are data. You need to know what’s going on there. In some ways, it’s becoming more of a research-oriented business than it used to be. People aren’t simply looking to find stuff that sounds good and trying to make a business out of it. They want to see there’s a little bit of momentum happening anyway. And that needs to be quantified and pushed out. I think that’s really important from an artist’s perspective:  You need to really understand your numbers.


I think from a writer’s/producer’s perspective, the most important thing is that you can get in the room. What I mean by that is that your co-writes are going to come from your ability to hang out with someone in the studio. A more successful writer is going to have a younger writer in the room because they like them. It’s important your tracks are good or your top line is good, and you need to work on your song structure. If you’re a hook-oriented, top line person, that’s the hardest thing to find. But in general, you need to get yourself out there.


We can set up a lot of contacts for writers. We can get them sessions with better known writers. But once you’re in the room, you have to be able to talk to an artist and figure out what their life story is and translate their story into a work that is going to be reflective of how they want their career to go. You’re going to have to handle split negotiations, which begin in the studio between writers. There’s a whole culture around the business that you have to be able to play along with. Otherwise someone like us can get you a lot of exposure, but if there’s no follow through, it doesn’t matter.


Increasingly, we’re seeing that young, emerging pop writers are getting work by becoming friends with other more successful writers who bring them into the studio. Look at what Dr. Luke is doing with Benny Blanco and all those guys. It’s returning to this kind of “camp” mentality in the pop business, where there is a group of guys that are successful and bring younger people in. We can help open up some of those doors. But we look for writers who can walk through them. It’s a little bit of a different exercise in that sense.


Also, with writer/producers who are sampling, you need to know your samples. And you need to be able to tell publishers, “There’s a sample in here, and it’s un-cleared/easily clearable.” The whole value of your publishing career can easily go away if you have a hit song,  but you have to give 95% of it to George Clinton.


I want to go back to the artist for a second, from the point of view of synchronization licensing, having a clear point of view about what you will and won’t do is really important. We’ve dealt with acts that literally say, “No Microsoft licenses, no Disney licenses. Full stop, we won’t work with those two companies. We hate them.” There are other people who say,  “I just want to make some money. I don’t care.” And then we had a guy who said no to a Rhapsody commercial that his video was going to be in. But they were clear, so it’s helpful for us to understand that.


The broad point is, you need to be responsible for your own data. It’s important that you think of your career in that kind of business type of way.


Musician Coaching:


Do you have any projections about what’s going to happen in the publishing business in the next five years? What do you see changing?




Everybody is trying to figure out where the boat is going at this moment. I don’t think anybody knows. There’s a lot of uncertainty. So, I think it’s really important to be able to make money on today’s dollars. I believe there’s going to be a lot of growth in the music business in general and in music publishing specifically over the next ten years. But nobody knows when that’s going to happen or to what magnitude. The real focus we have here is less on “what’s the dominant channel through which the large middle of American society is going to acquire music in ten years?” and more on “where is the money now, and where is it going to be tomorrow?”


I think you have a marketplace that needs to organize. There are very big pieces and very big interests that are being realigned at the moment. And that doesn’t happen quickly, by nature. Anybody that’s in the business can fairly assume there’s going to be a healthy amount of volatility in the next few years. And that speaks to the nimble. That’s why the strategies of companies like XL and and people like Martin Kierszenbaum at Cherry Tree  – more flexible kind of entities that really understand their music and how to work with their music – are going to be successful over the next little while. You have to know your music. It’s no longer the kind of organized market that operates like a portfolio of stocks:  Buy a thousand of them, and it doesn’t matter the dimensions, you’re going to win somehow. It doesn’t work that way anymore. You really need to understand the creative material you’re working with. I think the market’s going to favor people that can do that for the next little while.


The overall distribution channels and consumer behavior patterns are changing so radically that the only thing that makes sense is that people want music. If you’re the person that understands what music they want, it’s going to work for you despite the changes. That said, I would expect tight margins. There’s not a lot of getting lucky. I think in the music business, you used to be able to sell your way out of problems frequently. The business was badly managed, but you had a hit, so who cares? I don’t think that’s going to work over the next few years.


The whole thing about Sony moving their royalty calculation over to RoyaltyShare was interesting. I just saw that yesterday. I suspect that music companies will be smaller in the coming years. You’re going to end up with smaller groups of people who understand the creative side of the business better. And a lot of these traditional verticals that were controlled by the major labels – distribution, royalty calculation, back office operations – are going to be outsourced. In the publishing industry, we manage intellectual property that other people monetize. I think you’re going to see the whole business going that direction, which will be agnostic to format and based on licensing. It’s going to speak in a way to what publishers have been doing for a long period of time. But how long it takes for that to organize is unclear.


There are a lot of big organizations that have been operating the same way for 50 years or more  that are now reorienting. For example, EMI pulled its digital rights out of ASCAP. That said, wholesale changes to large institutions don’t happen quickly. I’m just not sure the clean, linear path is visible. I think if you’re going to be in the music business, you have to be prepared to make money on today’s dollars. You shouldn’t go in thinking it’s going to hockey stick around, and you’re going to get rich.


Musician Coaching:


Do you have any speculation on if there will really only be three major publishers anytime soon?




Nobody really has visibility into what’s going on in that part of the market. EMI is a very well-run company. I worked with Roger Faxon there, and I’ve seen what he does. He’s probably the best manager for the environment now. I think EMI will work something out.


If one of the big publishing assets that was owned by one of the majors became an independent and decoupled from the record label, that would be a very interesting shift in the dynamics of the business. I don’t think that at this point, the way EMI is talking in the press, it seems like that’s what they’re thinking. There’s been talk about what happens to Warner Chappell if they need to combine Warner and EMI. That would also be a very large interest that, if decoupled from a record label would be in a very interesting position. That is the thing I look at the most. It would be quite something else if a million-plus copyright business all of a sudden was a stand-alone music publisher, at least in terms of the trade dynamics. Is that going to happen? I don’t know. It surprised me how active the auction was for Warner when that went down. I’m sure EMI has a lot of interested parties. They have unbelievable assets there.


I try to pay less rather than more attention to the major label shenanigans that go on, because frankly, it’s helpful to me to be in another place. Big corporate transformation creates dislocation, and that’s where we’ve been successful at finding our way. But there are some good people in those companies, and I think part of the problem is that for a while, every internet genius thought the music business was doing nothing about its own problems and that  they had the magic solution. I used to work at EMI. We were spending every day trying to figure out how to right size our business in an environment that was almost like a crashing airplane that was on fire. It’s a very difficult environment in which to operate. You have to have some sympathy for people who are trying to do their jobs in a retail market that is collapsing. I can only speak a little bit to EMI because I used to work there. It’s a very well-run business at the moment in a very difficult time, and I think it will figure out where to go in its capital structure.


For more information about Matt Pincus, visit the Songs website. To learn even more about Matt’s history, publishing and synchronization licensing, please also check out Part I of this interview.