The Hot Seat: Thomas Heymann, Deezer

Published in The Music Network

 

In the fast-crowding space that is the streaming music market, Deezer has a few handy cards to play – experience and loads of cash. Len Blavatnik, chairman of Warner Music Group’s new owner Access Industries, seemingly pushed Deezer to the head of the pack when his firm recently pumped-in investment to the tune of $130 million.

Launched in France in 2007, the Web-based service boasts two million subscribers, and claims more than seven million active monthly users. Since 2010, Deezer says it has been running profitably and its catalogue of 20 million tracks is arguably the biggest among all the legal streaming models. Deezer embarked on an aggressive expansion in late 2011, and now boasts operations in 160 countries. And it’s targeting more. That international push included a business in Australia, which quietly launched here April 12 and is now helmed by Thomas Heymann. Heymann’s CV includes roles with Sony Music here and in Germany, and he has served as VP Strategic Marketing at Warner Music Australia. Prior to joining Deezer, Heymann was owner and Director of music label, management and consultancy business themusicconnection, and Program Director of Entertainment Management at the Australian Institute Of Music (AIM).

What does Deezer’s $130 million cash injection mean for labels and artists here?
We are using that money on a global level to grow the staff, and invest in the right partnerships and technology. Really, it’s for growing the business. It means we’re in a position to feed that investment into local, Australian artists and help develop them. And it’s about making our marketing and social media tools and our partnership deals available to them. We’re living in a global marketplace. Deezer’s position is to break down boundaries and to break down the old distribution model. For global citizens, for someone, say from Korea living in Sydney, they’ll have access to his local music in Australia as well. We believe music is global and should be available globally. (The investment) means we’re a serious player in this market. So we’re here to stay.

What’s the killer sales point of Deezer?
Editorial. Part of Deezer’s global rollout is that we have a local editor. We’re publishing a bi-weekly newsletter, which goes out to 50,000 subscribers. And we’re running a local Facebook page. At the moment we’re focusing very much on developing artists. That’s the spirit of the business we’re in right now. We’re getting feedback from the labels and artists. You can talk with us, meet with us, set up campaigns with us. We have some sophisticated marketing tools which you can share with artists and labels. And we have better sound quality than any other music streaming service. And we’re a real local operator. We’re already finding a lot of interest from Australian artists who operate globally on the potential to getting access to our two million subscribers worldwide.

There’s talk of a free service. Is that essential to compete?
Yes, we’ve announced we’re going to launch a free service. We don’t know when we’re going to do that. But it will certainly be different to our competitors. We come from a position as a business that’s actually making money and we’ve got two million people worldwide paying for our service. We’re going to use that free service as an acquisition tool to gain more subscribers. We’re all about building a sustainable long term business model. That’s very much our focus.

Do you get a sense that it’s now an overcrowded market?
I don’t feel so. At the moment, the only people talking about (saturation) are in the industry. I believe there will be a shakeout over time. And there may be three or four–or even less services–left over. To a degree, we’re all working together to educate the consumer about the benefit of music subscription as an alternative to piracy.

How powerful is that “free” market here in Australia?
Piracy, of course, is still a massive concern in Australia. All the labels we’ve met in Australia are incredibly supportive of our launch. Generally, music subscription is seen as a legal alternative to piracy. It’s basically taking the excuse away from people who are using pirated music.

Are digital downloads on the way out?
It’s hard to say. With Deezer worldwide, our users are listening on average two hours a day. If you’re part of music subscription, I believe you’ll use it more often because you’re not confined to certain devices where you have downloaded or stored those tracks.

You’re not operating yet in the US or Japan. Is that going to change anytime soon?
It will happen. At the moment, we are very much focusing on emerging markets and fast-growing markets. Australia has been identified by Deezer as one of the most attractive, fastest growing markets around the world.

 

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The Hot Seat: Ben Preece, Mucho Bravado

Published in The Music Network

 

Ben Preece is a bona-fide scene-builder in Brisbane. The 33-year-old owns and operates the Mucho Bravado artist management and PR firm, which this year celebrates its fifth anniversary. With his partner in the business, Angela Kohler, Mucho manages a string of Triple J-favourites, including Ball Park Music and Hungry Kids Of Hungary, and handles publicity for the likes of Emma Louise. He’s also behind Club BAM, a newly-created invite-only page on Facebook, where artist managers can “bond, connect, support, teach and learn,” Preece tells TMN. Preece still juggles events organizing and writing. In years past, he was bookings manager with The Troubadour, and served as Music and Programming Manager with Nightlife Music.

Has building your business in Brisbane been an impediment?
The short answer is no. There is still an old-school perception that to be a good business, you have to be based in Sydney. I certainly travel enough to bridge that distance. Our clients are now starting to transcend states, which is a first for us.

Are both sides of the business equal?
When we started, we didn’t know any better. Ange and I were made redundant in 2007, and we didn’t want to work for ‘The Man’ again. So we started taking on PR clients. We felt we could make this as big or as little as we wanted it to be. We grew into management really quickly, but we were naturally publicists. Publicity was started out of necessity; it’s one of those things which carries us through the quiet times financially. Management typically doesn’t pay off for about three years with any one band, obviously if they’re walking the right path. I still feel management is foremost what we are right now.

That must be awkward, to be working with your former partner in life?
It’s not easy, but she’s amazing at what she does and we have a great chemistry. I don’t know if it’ll work forever, but it works for now and it has for the last few years.

Is it a growing business?
Yeah, very much so. We’ve had a great couple of years. Hungry Kids of Hungary were probably the first great client we took on. Before that we had small bands. We leapt straight into The Basics, which was a massive learning curve for me. My first job with them was to book a 52-date national tour within schools and malls and anywhere the band could play. They didn’t have a booking agent, they couldn’t understand the concept of a booking agent. “It’s what managers do, isn’t it?” Well, it isn’t the case.

What are you looking for in a band?
I’m a big song guy. I’m not the guy who’s looking for the tragically cool looking bands upfront, or the amazing live show – though I know that’s a necessity, particularly in Australia. I was young and naïve enough when I took on Hungry Kids and Ball Park Music to not even think about that other stuff. Now if we’re taking on a client we look at everything. Bands these days need to be 100% together to turn anybody’s head. When I’m managing a band, I throw my life and soul into those bands. Hungry Kids and Ball Park I’m particularly proud of, because I feel like there was some discovery involved. I found both those bands on their second or third gig. Our A&R skills set us apart at the moment. We apply those skills to management as well as publicity and we’ll do so with whatever we do in future. One day, we woke up and wiped our slate clean and started again with a good, promising A&R ethic.

Are there plans to add any units to the business?
Yeah, I always thought Mucho was a platform for many ideas. We’ve tried a few things which haven’t quite worked, not because they were a bad idea but perhaps the wrong people. I’m still very interested in the programming and event side of things. I grew up in the music industry programming music. I feel like it’s an untapped talent I’d like to indulge once in a while.

What’s the state of the independent music biz right now?
It’s in a good place. Labels are going to hate me for saying this, but they’re becoming more and more redundant in a way, particularly in Australia. I can certainly understand signing to a label overseas, it’s a much bigger picture and scene over there. In Australia we have a nice grasp of everything. I feel we can almost do a lot of these bits and pieces ourselves.

If you were to start in this business now, how would you build from the bottom up?
I’d definitely be more savvy with my business sense and structure. I struggled with the financial side of things for a long time. Ange had more of a business brain than me. Initially, I didn’t see myself as worthy of getting paid. Now, I’m very protective of a lot of young managers I talk to. I encourage them to try get paid up front. You should set your ambitions high enough to make some money.

 

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The Hot Seat: Michael Long – Event Producer, ARIA Awards

Published by The Music Network

 

The ARIA Awards are fast approaching. And this time around, there are some big changes — both in front of house and behind the scenes. For the first time in a decade, the Australian record industry’s flagship awards ceremony will take place at the Sydney Entertainment Centre and Mark Pope won’t be at the helm. Pope’s right-hand man Michael Long–the long-time ARIA Awards Director of Operations–is now in charge of the November 29 show as Event Producer. It’s an unenviable task. Get it right, and you’ve done your job. Mess it up, and the entire country knows about it. Long has a lengthy career in touring and event organising. He tour-managed INXS from 1984-1995, he managed Jimmy Barnes from 1997-2000 and he’s worked as tour director for Cold Chisel. From 2001-2004, Long produced the Music Oz Awards for WIN TV at the Wollongong Entertainment Centre, and he’s served for seven years as National Festival Manager at Good Vibrations. He’s also kicked goals of a more literal kind, having worked with Liverpool Football Club great Craig Johnston in a Business Development Manager capacity.

 

The ARIA Awards are fast approaching. And this time around, there are some big changes — both in front of house and behind the scenes. For the first time in a decade, the Australian record industry’s flagship awards ceremony will take place at the Sydney Entertainment Centre and Mark Pope won’t be at the helm. Pope’s right-hand man Michael Long–the long-time ARIA Awards Director of Operations–is now in charge of the November 29 show as Event Producer. It’s an unenviable task. Get it right, and you’ve done your job. Mess it up, and the entire country knows about it. Long has a lengthy career in touring and event organising. He tour-managed INXS from 1984-1995, he managed Jimmy Barnes from 1997-2000 and he’s worked as tour director for Cold Chisel. From 2001-2004, Long produced the Music Oz Awards for WIN TV at the Wollongong Entertainment Centre, and he’s served for seven years as National Festival Manager at Good Vibrations. He’s also kicked goals of a more literal kind, having worked with Liverpool Football Club great Craig Johnston in a Business Development Manager capacity.

The 2010 edition was widely perceived as a fail, and it’s probably tarnished the brand with the general public. What was learned from that experience? We lost focus on what the night is all about, which is to recognise the success of Australian artists and give them their moment of recognition. This year we’re having it in concert-style, more like the Grammys, where everyone is facing the stage. So there’s not a bad seat in the house. It will really put that focus back on the awards and the reason why we’re there. We also learned a lesson in 2010 with the genre awards. The vision from those series of concerts was fantastic, but having those nominated artists performing in the week leading up to the awards took the focus away from the Awards night itself. From the general public point of view, it was a confusing message.

What will this year’s show look like? Having the concert seating on the arena floor and not having the table setting is a big change to how we have done it in the last ten years. But we feel the perception of that will be producing a shorter, sharper show which will be more dynamic, more entertaining. All the food and beverage aspects will happen in the foyer and outside areas we are creating. It’ll be very luxurious. There will again be a 45-minute dinner break, and when we return for the second half of the show we’ll have ten awards and six performances. Afterwards, we’ll go back out for coffee, dessert and mingling. Then a shuttle service will take the industry to the Marquee at The Star for the official ARIA aftershow party. It’ll basically go 3.30pm to 3am. That’s back to how it was many years ago when people kept partying all night.

Why the Entertainment Centre? It comes down to a lot of different things: venue availability, logistics, the night of the week. Allphones Arena has been an incredible venue for the ARIAs, but the Entertainment Centre came to life on the date for us.

How does the budget compare to last year? Budgets are tight. There’s no denying that. It’s the same with every major music event. We’ve had to rethink a few things. But it will still be a world-class event, and the industry will still receive the same food and beverage package that they’ve received in the past.

Is there a future for the show on live, free-to-air commercial TV? The partnership that we formed with Go last year was extremely successful. Usually, the viewing numbers start really strong then by the end of the evening they drop off. Last year, it stabilised and increased toward the end of the show. The event was playing more to the direct music demographic of the channel, and there was chart success for the artists who won awards and performed on the night. At the end of last year we had a rethink and were really happy with the results we achieved in 2011. It was a really positive step forward from the previous year.

Some say the Awards should go small, and pull the plug on TV broadcast altogether. Would that be a good thing? That has been discussed, yes. But it’d be a shame if that broadcast didn’t happen, if the music-loving public that can’t make it to the live event couldn’t actually get to see it on TV.

What do you think is the general perception out there of the ARIA Awards? You brought up 2010. Yes there was some ‘brand damage’, if you like. Or perception from the general public was a bit confused. But in 2011 we really did make some ground back. In 2012, our response from the general public on ticket sales has been overwhelming. There’s a lot of excitement out there. We’ve got radio on board this year. We’ve got full support from Nova/Austereo. And ARN are supporting the ARIAs this year. There’s a lot of goodwill out there and a lot of positive energy. The perception of the ARIAs is that we’re coming back, and we’re coming back strong.

Is the ARIA Awards Event Producer job a poisoned chalice? Ha ha. I don’t know. Ask me on November 30.

 

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The Hot Seat: Guy Ngata, GM, Allphones Arena

Published in The Music Network

 

Guy Ngata has had less than a month to get a feel for the enormous space that is his workplace, the Allphones Arena. In mid-September, Ngata succeeded Paul Sergeant as GM of the 20,000-capacity Sydney venue, which AEG Ogden manages on behalf of the Nine Entertainment Company. The New Zealand-born exec. arrives after a two-and-a-half-year stint in Shanghai, where he served as GM of the AEG-OPG Culture and Sports Company-managed Mercedes-Benz Arena. Ngata had presided over the opening of the Chinese venue back in 2011.

Prior to that, Ngata was Director of Operations and then CEO of Auckland’s Vector Arena. It’s been an eventful stretch for AEG Ogden. In late September, US-based Anschutz Company announced it was planning to sell AEG. Word from the top is that it’s “business as usual” for the joint-venture in these parts. Earlier this year, private equity operator CVC Asia Pacific announced plans to auction the Allphones Arena.

How’s business?
We don’t have as many shows as we’d like. Obviously part of my mandate is to work closely across the group in making sure we can secure as much content as we can. That’s my number one goal. And we want the patron experience to be exceptional. The Sydney Olympic Park Authority is looking at mechanisms for improving parking in the precinct, public transport options, and getting traffic flowing in and out. Obviously we can’t control what happens on the stage. But certainly we can control all the touchpoints around it and make sure they continue to improve.

How important is music to your model?

It’s probably around 60-65%.

You lost two dates when the George Michael tour was cancelled. Who is worst hurt by a cancellation?

It hurts the punter first and foremost. Obviously it flows from there. The promoter, us, the ticketing agent, the sponsor aligned to the building. Unfortunately those dates (November 17 and 18) were too close for us to be able to do much else with them. You’ve just got to focus on what you can change and what you can do better in future.

How many dates a year can you host events in a venue like yours?

Most shows of an international standard here require at most a one-day load-in. Realistically, you could look at 150-200 event days a year. There are different spaces in the building we can use simultaneously. We don’t have a situation like the Staples Centre in L.A. which has four anchored sports teams playing in that building and they build all their concert activity on top. They have 260-265 event days a year. Our market is not that big. But we want it to be as big as it possibly can. Perhaps 170-180 events, up to 200 events a year would be achievable. Business functions are really important for us. We cater in-house so it’s an important revenue stream for us. We’re obviously looking at family entertainment and TV-events.

You had a stint with the group in China. What did you learn from that experience?

It’s a pretty complicated and complex market in many ways. Like anywhere, you have to show people respect and that you’re working for the good of the organisation. We had a very strong commitment to our sponsors, as we do here. We had 11 sponsors in the building, from our naming rights partner Mercedes-Benz through to some of our suppliers Coca Cola and Budweiser. You need to put runs on the board early, establish the building, the reputation.

Is there a growing hunger for international music in China?

There is. And that will continue. The artists that have worked hard in that market are the ones who have reaped the rewards. There’s got to be a link to China that can drive the consumer. We had probably ten international acts through last year and there’ll be a similar number this year. You’ve got to remember, there’s a massive demand for home-grown content in China: Cantopop, K-pop, J-pop, and mainland Chinese music. Last year the Eagles played there the first time and we had 11,000 tickets sold for that show – close to a sell-out for us. Yet Faye Wong is an artist who came out of retirement and played six sold-out shows, to 75,000 people. The Chinese consumer still wants a lot of Chinese entertainment. But there’s a growing desire to see more international artists come through, as there’s greater exposure to the music on the radio, online and TV.

How much can we read into you playing a role in building a circuit with Asia?

That’s something we’re certainly looking to establish more of. There are promoters in that region with an interest in the Australian market, and there’s certainly a growing Chinese population here. I’ve started some dialogue and we’re looking at how we can support some of that activity in this region.

What are the biggest challenges confronting the arenas business Down Under?
The market seems a little bit soft in terms of ticket sales across shows. Consumers are sensitive to price, but that’s no different to a lot of markets. We’ve been speaking to promoters and we’re all mindful of trying to keep an achievable price-point for the mass audience.

 

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