The Hot Seat: Kate Vale, Spotify

Published in The Music Network

 

The long wait to play with Spotify is over. The popular streaming music service finally arrived last Tuesday in Australia and New Zealand, the company’s 14th and 15th markets since launching in Sweden back in 2008. The company boasts a licensed catalogue of more than 16.5 million tracks, with some 50,000 songs loaded globally each day. And like elsewhere, the service has three tiers, starting with the ad-funded ‘Free’ offering, rising to the $6.99 monthly ‘Unlimited’ and the $11.99 monthly ‘Premium’ options.

Spotify doesn’t have Australia on a plate. The likes of Rdio, Deezer, Rara and JB Hi-Fi ‘NOW’ are already in the market. TMN caught up with Kate Vale, who oversees Spotify’s Australasian operations and its ten staff Down Under.

My understanding was that Spotify would launch here in March. What took so long?
There were a lot of things to line-up internally to get the launch ready. We wanted to make sure when we launched that we had an amazing product. We made sure we were ingesting all the right content, that our catalogue was as full as it could be. We wanted to also launch with the iPad app, which we’ve managed to do. And also launch with a local app partner, which we’ve done with Triple J [and NZ Top 40 in New Zealand].

So there were no licensing hitches?

No, nothing to talk about. Everything was fine. The labels are very excited to have us here.

Are you concerned you’ve lost ground to Rdio and others?

Absolutely not. If anything it’s great for us. It paves the way. We find in any market we launch we have competitors there before us. It only helps us. The key benefit to us launching in Australia is the fact we have a free tier, so there is no barrier to entry if people are already paying a subscription and they want to come give us a go. Australians are going to change the way they listen to music. It’ll shift towards access to music, rather than owned.

Can you share with TMN how many people signed up for any of the three tiers on launch day?

No, I can’t. But uptake is fantastic.

Do you have a goal for the number of users you plan to graduate-up to Premium?
Internally, yes, we’ve got some numbers we’re throwing around. But nothing we’re prepared to share externally. Every market is different. We haven’t launched in many countries post-Facebook integration. We haven’t launched in any countries outside the US and Europe until now. There are all sorts of things out of our control that are going to dictate how we perform here.

Australians are still hooked on the format of CD albums. What are your thoughts on Australian consumer habits in this access-world?
There’s absolutely still a place for CD sales. It’s up to the individual as to how they’d like to consume their music. In other markets where Spotify exists, we haven’t seen any cannibalisation of physical and the labels have come out and said that. We still see that [CD sales] as a very vital part, and if anything we’re hoping that we’ll be able to grow physical sales. We have seen signs of that in other markets as well. People go on to Spotify and use it for music discovery and then go on to buy CDs.

You’ve also launched in NZ? Is it the same site and how do you view the market?

It’s exactly the same, just the pricing is different. Kiwis are very much into indie music. And they love their homegrown music. Also, I believe piracy is bigger in New Zealand than it is in Australia. Hopefully that is a good opportunity for us to get more money into the music industry.

You’ve a string of launch partners, including Commonwealth Bank. How critical is third-party financial support to your business?

They’re absolutely key for our success in any market. If we didn’t have [them], we wouldn’t be able to offer Spotify users a free service. These advertisers come on board and help support and fund that free tier. We take them on board for three months then open it up to other advertising partners. Seventy percent of our ad revenue and subscription revenue goes back to the labels. It’s feeding the industry.

How often do the ads come in?

Generally after every third song. It’s about one ad every ten minutes. That’s the audio component to the platform, but there’s also a digital component that are only displayed to users when they’re active on the application.

According to a report in The Australian, Spotify is in talks with Virgin Mobile in Australia and Vodafone in New Zealand to bundle the service with mobile plans. Is that true?
It’s absolutely incorrect.

Sean Parker made the big call that Spotify can catch iTunes in two years. Can it?

I’ve absolutely no comment on what Sean Parker says [laughs]. There’s a place for iTunes and Spotify in any market.

 

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John Butler Wins Yoghurt Sound-alike Stoush

Australian folk-rocker John Butler Trio has settled with the creative team behind a yoghurt campaign whose sound-alike ad played to millions during the 2012 Super Bowl contest.

Perth-based Butler had challenged Poptent after the U.S. advertising agency’s campaign for Dannon Oikos carried a soundbed which sounded a deadringer for the artist’s song “Zebra”, the first single from the group’s 2003 album “Sunrise Over Sea” (Jarrah).

Butler is frontman of John Butler Trio, a multi-platinum, ARIA Award-winning chart-topper Down Under.

In a statement issued today by Butler’s PR team, both parties have reached a “satisfactory settlement” in relation to the song which “bore a strong similarity” to his work. The commercial will “no longer contain this particular piece of music and both parties are happy this issue is behind them,” the statement read.

Butler’s manager Philip Stevens declined to discuss whether a sum changed hands and offered no further comment.

The ad, which stars John Stamos, aired during the third quarter of the Super Bowl, and would have caught the eyeballs of more than 111 million football fans.

Soon after the game, the agency posted a note on Facebook which read, “A question about the music in our Super Bowl commercial has been brought to our attention.” It added, “We are working to fully understand and address the situation. We apologise for any concerns this has caused John Butler.”

The yoghurt ad campaign has since been taken down from YouTube.

The Hot Seat, Stephen Wade, Select

Published in The Music Network

 

Select Music started life seven years ago with a staff of three and a small roster. Now, the booking agency employs seven staff and represents more than 60 artists – including Boy & Bear, Bluejuice, Midnight Juggernauts, Josh Pyke, Emma Louise and Ball Park Music. In that time, Select’s business model has evolved for the changing times. Wade admits his company has always been a “behind the scenes, stay-out-of-the-limelight” type company. That’s about to change, as Select gets into party mode to celebrate with five parties on June 21. Seven year itch? Hardly.

How has Select gone about its business?
We’re passionate and hard working. We’ve certainly had great success with our agency. Our acts had nine of the songs on Triple J’s Hottest 100, and 19 out of the next 100 hottest acts. The old-school way approach of agencies was, “if your acts don’t play you don’t make any money.” We were the other way. The act should play when it’s right for them to play. If you do that and you do it right, of course you’ll make money in the end. You’ll be doing better shows at the right time rather than a lot of shows where many don’t seem to matter. When we started, we couldn’t compete with big agencies. It literally came from having a good ear for music and passionately going in. We always wanted to build it along a family type of line, so that being part of the Select Music family was that acts would play together and get to know each other and feel that is meant something to be represented by us. I’ve also had the luxury of managing Something With Numbers, a band signed to a major label. So when we represent and act, we’re involved. We help them with everything from giving them connections on the right poster company to put up their posters, the printers, where they can get the cheapest deals. We look at all the artwork for our acts. It’s about attention to detail right from the start. The old thing of, “hey, we book a show.” Well, that’s the last thing we do.

All bands want an agent. What are you looking for in an act?
We always look for a band that is committed to a long-term approach for their career. A ten-year career. We firmly believe those first 18 months are the set-up for their whole live career. Regardless of whether they’ve had huge buzz and success or not, it’s all about setting up the initial plot so people perceive that act as a viable ticket to go see. Obviously the talent is the thing that comes first. Just as important is the drive of that act knowing that they want that long term career and they’re prepared to work hard and wait for those opportunities. When an act isn’t at a certain level, it’s a mistake to push them to something where they could end up being uncomfortable or not reach their potential.

What should an artist look for in an agent?
Agents now have had to take bands on a lot earlier than they did in the past. it can break open so quickly for acts. Acts need to be looking for someone they can have a connection with. The agent’s role is so integral to their career. And the artists need to know who is representing them. Most of the agents in Australia are incredibly experienced and know their game pretty well. You don’t have a lot of venues and options to chose from. You look at a place like Brisbane; venues close and don’t get a replaced a lot of the time. You’re hampered. The agent’s role is more about knowing when and where to play at the strategic time. When to push the button, when to underplay. It’s more about decisions than venues these days.

You launched the Stop Start label in late 2009 with Andy Bryan and Rob Giovannoni. Why?
It was about being an indie music company, which we are. A lot of the artists we were dealing with were asking how they could release product and where to release it. They didn’t all have access at those appropriate ties. We were A&Ring a lot of these acts quite early in their careers. We’re so early at the coalface, we wanted to give these guys a full indie label experience where they’re exposed to just a small group of people who are committed to their band but have all the accessibility as a major label. [Stop Start has a distribution partnership with EMI Music Australia, and its signings include Hungry Kids of Hungary, Maniac, Pluto Jonze, Northeast Party House and Old Man River.]

Are there too many booking agents and promoters?
No. The market will regulate itself. There are only so many acts that can go out there and play the venues that are out there. The venues, they want acts they think can sell them tickets. If you don’t succeed as an agent or a promoter, it’s because you don’t have the ability to work with the right acts. We just feel growth and more opportunities as we go along. You get the opportunities that you work for.

Select Music will host parties at OAF and OAF Gallery, Phoenix Bar, The Standard and Upstairs Beresford on Thursday, June 21. Funds raised will benefit the Beyond Blue charity.


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The Hot Seat: Nick Gatfield

Published in The Music Network

 

Nick Gatfield is a highly-sought breed of music industry exec; he’s a music man with a head for international business. Gatfield arrived at the helm of Sony Music’ s UK company in the latter months of 2011, bringing with him 30 years of experience on both sides of the Atlantic, and from both sides of the negotiating table. Gatfield was a member of Dexy’s Midnight Runners when they briefly ruled the airwaves with Come On Eileen. But his greatest achievements have arguably come as a major-label A&R. Gatfield signed Radiohead to EMI, and has worked closely for the likes of Amy Winehouse, Keane, Sugababes, and Tinie Tempah. TMN caught up with Gatfield on a recent “tour of duty” to Sony Music’s Australian affiliate.

You’ve now worked in senior exec positions at three of four majors in last 5 years. What are your thoughts on the Sony culture you’ve moved into?

The EMI experience was interesting, largely working at a music business controlled by a private equity firm. The great learning from that is there is absolutely no comfortable marriage between private equity and creative industries. This is not a criticism of Terra Firma. A lot of stuff they did was actually very positive. But we’re always accused of being luddites, or trying to preserve our musical integrity. The role of A&R, which is the entire driving force of the business in my mind, is a dark art. It’s incredibly hard to quantify. It’s incredibly high-risk. And the exciting thing for me at Sony is it’s populated from the very top with music people who understand that risk and understand you’ve sometimes got to speculate to accumulate. Doug Morris, our global CEO, is a music man. It’s such a pleasure being back at a company being run by music people. And it’s run as a very efficient business. The company is in good health, considering where the overall industry is.

Australia doesn’t have a “graduated response” law. Should it?

I said something in The Guardian which turned out to be fairly explosive, where I said a lot of ISPs’ businesses had been built on the back of piracy. I got a huge amount of flack for that. But in the last few weeks, BT has been pulled up on the company’s practises of selling broadband. They were absolutely encouraging people to acquire content through illegitimate means. The ISPs used to say, “We’re just a pipe, we can’t control what’s coming down the pipe.” When they’re trying to sell broadband packages off the back of illegally downloading our content, that’s clearly not on. And clearly they’re not behaving in a legitimate manner. Part of our lobbying has been very much about search engines through to illegal site (identification). In the U.K. now there’s a mandate to be at the cutting-edge of super-fast broadband, so of course this has woken up the movie industry much more than it has before. Music has largely been a single voice in that space about protecting IP. Now you have a louder voice, and a collective voice of rights controllers, which is definitely having an effect. There’s now enough evidence around the world to say a combination of legislation and good customer services is turning the market around. Sweden is a case in point, with Spotify. We’ve seen significant growth on the back of the Hadopi law (in France). I’m optimistic, but unfortunately our government’s a bit slow.

You were a member of Dexy’s Midnight Runners. What did you bring from your artist background into your exec career?

I always say to artists, “I’ve been in a successful band, we had hits, I’ve had stiffs, I’ve been dropped, I’ve been signed, I’ve been through the entire range of career highs and lows. I’ve toured the world as part of a very successful band. And toured the world as part of a not-so-successful band.” My conversation with a lot of artists is about their level of ambition. If you sign with a company like Sony, which will have global ambition for you as an artist, we want to make sure our ambition for you matches your ambition for you. Because if it doesn’t, it’ll probably be an unhappy fit. Coming out of Dexy’s, there was a tension back then between and artist and the company. There was a creative tension and – Kevin (Rowland) would probably forgive me for this – perhaps a lack of ambition within the band which meant some opportunities weren’t necessarily taken. There’s a cultural change now. I really do view artists as our clients now. We stay in business because of the level of service we provide, and we have very good working relationships with our artists. And we have the same ambitions and dreams and aspirations for them.

Do you still have a set of the dungarees you wore?

Oh, yeah. I still have the dungarees. I’ve got a beret. God knows where they are. They’re probably in an attic and my kids are using them.

Sony’s repertoire in the last 10 years has been largely driven by reality-TV shows. Will that continue to be the case?
There’s been a shift in that the reality TV artists had a stigma attached to them. It was always a case that they didn’t travel. Not any more. One Direction is a case in point. Rebecca Ferguson, Olly Murs are others. The X Factor happens to be a very legitimate platform to introduce new artists. When the artist is good enough and the record is good enough, it will travel. I don’t take the platform for granted. It is a gift. Some say it’s a curse. My role is how to balance the success of the reality TV artists with the other side of the business. The X Factor is almost unique; the more we get involved in the show, the more there is a real music component to it in terms of music professionals, the better the talent that comes through. The X Factor in the UK is a cultural phenomenon. It’s still the biggest show on TV with 15 million viewers a week. We’ve done three million units from artists who came through that platform in the past year. That platform is phenomenal.

Will you bring back some locally-signed repertoire and feed it into the machine?

Yes. I was very interested to see both Timomatic and Reece Mastin. On an immediate level, when I first heard the Timomatic single (Set It Off), it comfortably fits into UK commercial radio. I wanted to meet the DNA guys – and they’re coming back to the UK – because they’re making world-class music. These are records that will compete on radio anywhere. Having seen Timomatic on a performance level, he’s got it. There are other European territories also taking a shot. Reece has some opportunities. The recent success we had with One Direction might give us some sort of pathway of how we break him. It’s entirely driven by social media. What One Direction has taught us is that teenage girls are the same worldwide, whether its Australia or UK or US, they have exactly the same motivations and passions. It’s just reaching them. If we can find that same lane for Reece, and have social media start that conversation and create a platform for him, then there’s an opportunity there. He’s got that broad pop-rock appeal. He’s got exactly what that audience wants. Denis Handlin invited me down to the company a few months ago. I wanted to see for myself how the business down here operated because these guys have been so successful in delivering U.K. talent. It is one of our centers of excellence at Sony. I decided it was about time I saw what they were doing and how they get it right all the time (laughs).


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