Feeds

Universal exec - say goodbye to the old record co.

RIAA man stuns crowd

The Power of One eBook: Top reasons to choose HP BladeSystem

MidemNet An RIAA board member and executive from the world's biggest record company has said the old way of doing business has gone forever now.

Larry Kenswil, president of Universal Music Group's eLabs, might not speak for all of Universal Music, but he does speak for an important part of it. Kenswil today said labels could no longer "count units" but had to license rights.

The eLabs chief's comments caused a few jaws to drop here in Cannes, but it's part of a sea change in strategy at UMG. The DRM gurus have departed - Barney Wragg left Universal last summer - and Universal is striking deals with anyryone who can hold a pen and scrawl an X. Towards the end of 2006, MySpace, YouTube and Microsoft all agreed to pay Universal for rights to their catalog - material crucial to the success of their products or services.

"We can't think of it as counting unit sales anymore," said Kenswil. "We have to license ... and think like the publishers."

After initially threatening to sue, Universal granted YouTube a license to its catalog, which permits users to repurpose it to create new content. Asked by a panel moderator at MidemNet how much users were paying for the privilege, Kenswil joked,

"Users are creating free content for YouTube. Maybe the question should be, 'How much is YouTube paying its users'", said Kenswil.

That's a subtle dig at the Web 2.0 idea whereby users produce stuff for nothing for the benefit of hugely profitable multinationals (MySpace is owned by News International, and YouTube by Google) , under the guise of "sharing" or "user generated content". This approach to business has been dignified with some fairly bogus pseudo-economics, but is better described by the label "digital sharecropping".

YouTube was granted a blanket master license, but Kenswil said that if artists objected they would request the licensee withdrew the material.

"It's a whole new revenue stream for our record company," he said. Kenswil wouldn't elaborate on how it worked, but said getting the new deals in place was an involved process, and hinted that he'd much prefer not to have to do it company by company.

"The box is getting smaller, so if you don't think outside of the box your company is going to get smaller." Kenswil said.

Asked about the "Long Tail", Kenswil called it "an interesting catchphrase" that wasn't in itself much help to doing business.

He agreed that "larger virtual shelfspace" meant more products would sell more.

"Universal's catalog is 300,000, alot smaller than [last.fm's database] 65m. But most of those 65m will be listened to once. That doesn't make up for the decline in the head."

Kenswil urged record labels to partner with independents:

"Indies have always been the lifeblood of the industry," said Kenswil. "It will fall on indies even more than before to find talent".

The executive's comments made a discussion that took place just moments earlier seem like it belonged to a different era.

Kicking off proceedings at MidemNet, the Recording Industry Ass. of America's maximum leader Mitch Bainwol, and the Motion Picture Ass. of America's executive VP Fritz Attaway took lumps out of Gary Shapiro of the Consumer Electronics Association.

Shapiro said "it's become a profit center for the RIAA to devastate families." Bainwol said DRM " served a legitimate pro-consumer role", in creating new models. Attaway said DRM wasn't perfect, but it "was the only tool we had to prevent indiscriminate copying," and Bainwol accused Shapiro of wanting the destroy the "only way" of doing business the record industry had. Did he just say "the only way"?

Sadly, Shapiro couldn't counter this absurd accusation.

Happily, within an hour, one of Bainwol's own board members had. ®

Top three mobile application threats

More from The Register

next story
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.