As mentioned in last week’s roundup, the seventh San Francisco Music Tech Summit is today at Hotel Kabuki, from 9am-6pm, followed by a traditional schmoozer from 6pm-8pm.
Live updates and panel notes are below the videos.
FOLLOW-UP NOTE: Let’s just say I’ve gone Gonzo. While I have been attending and speaking at conferences for a number of years, this is the first time I have ever logged my own notes, questions and experiences in real time and, subsequently follow up the notes with questions and answers. You are invited to join in the process. Please look for “Follow-Up” notations. You can also write to me directly corey@sfappeal.
Video: The MiniMasher, developed my MoldOver
Video: Between Panels, An artist attending SF Music Tech finds a piano.
Panel Notes…
4:49pm Panel: What Music Companies Need From Startups
Moderator: Ian Rogers; CEO Topspin Media
Panelists:
Ethan Kaplan; SVP Emerging Technology, Warner Music Group
Aaron Foreman; Universal Music Group
Ian Hogarth; Songkick
Rachel Masters; Red Magnet Media
Moderator: Have startups found a home with Warner Music Group?
Ethan Kaplan: A lot of startups I rely on fill gaps. We have a technology group so it just comes down to my decision, determining what the ROI is. A lot of what we see come in the door we can build. So it comes to a matter of the opportunity cost versus cost of implementation and the cost of de implementation. It’s hard to determine if there’s any startup we’ve used consistently for 5 years for anything other than infrastructure. Big Champagne is an 8 year relationship, of all “startups” that aren’t infrastructural, Big Champagne is the one.
Ian Hogarth: We use products like Music Brainz. When we look into integrations we look at what will be helpful to live music fans to discover shows. We look at the search experience around live music.
Ethan Kaplan: If you are going to be B to B, don’t start out as B to C.
Moderator: Rachel you are out talking with startups and artists. How are you doing it?
Rachel Masters: In this day and age the easiest thing to do is work with managers. Working with labels is difficult and managers are closer to the artists and give you direct access, so you get to be part of the creativity loop. That’s where we’ve been very focused to date.
Moderator: Is that because management have leverage?
Rachel Masters: definitely – and they are looking for revenue opportunities. With label support and revenue dwindling, your digital management person at a label is overwhelmed so management companies are hiring digital people internally. And then sometimes they really want someone in Silicon Valley with access to new information.
Ethan Kaplan:Um, in my history working with managers, they default to “yes” – they always want their artist to be first. First to do something new with facebook, or some startup which may not be cost effective or actually the right decision. We need a bullshit meter, to prevent doing something that isn’t successful. They [managers] will say yes too quickly.
Moderator, to Ethan – What makes it through your Bullshit meter?
Ethan Kaplan: Transparency. If i can take something that’s on-brand and integrate it with cool technology that enables us to go further and provides value, which for me is data, so things that bring a bidirectional play of value to the table, so we can present the brand transparently…I mean… a lot of that comes down to tools and stuff that help us market our bands better. When it hits my desk it’s fundamental infrastructure to help our bands make money.
Moderator: before you have a great idea, test the efficacy. Be careful how you choose, because it is a small industry.
Ethan Kaplan: If you affect the relationship between an artist and anyone on their team, you effed up.
Rachel Masters: remember it’s a small industry, it’s transparent and not like startup culture. It’s very small.
Ian Hogarth: If you do one thing very well, it’s easier for music companies to understand what you do. Look at Last.fm and Pandora. Last.fm did about 10 things, Pandora does one. If you want to get integrated into many places you have to have a very clear focus.
Ethan Kaplan: If your demo works for people who don’t understand technology, you’re golden.
Moderator: Rachel, for startups pitching, before you get to the point where you are using API…
Rachel Masters: You have to explain what APIs are. Treat everyone’s assistant like gold. Make friends with every single person at every single music company you can, because you never know who is your key. Remember, you are walking into a music company, NOT a venture capital office. Make it Rock & Roll. Get rid of your power point and show off your product. Let it speak for itself. Make it easy for people to say “yes.” Tell music companies which artist you want to help, how you will do it, how you will measure it, and how long it will take.
Audience question: How much does the type of deal you have with a given artist impact the deals you do?
Aaron Foreman: we have to find additional ways to generate revenue.
Ethan Kaplan: We have to service deals to the degree we have the deal.
3:35pm Panel: What Works?
Moderator: Bryan Calhoun, Vice President SoundExchange
Panelists
Gabe Adiv; TuneUp Media
Jeff Price; TuneCore
Larry Marcus; Walden Venture Capital
Emily White; Whitesmith Entertainment
Jeff Beaver; Zazzle
Moderator: How do you go from being small to a larger level?
Jeff Price: I’d love to take credit. Look, art causes reaction. I am not going to take credit, I can’t. There are a lot of things you can do specifically. You can go into iTunes and create an iMix. Do cover versions of songs because people search for cover versions of songs. There’s a number of other things you can do on facebook and twitter. In my opinion everything you are hearing from the music industry is a pile of shit. The reality is the music industry is more vibrant now than any other time in history. There’s money being generated by Pandora and all these other services. SoundExchange alone has 1/2 a billion dollars for artists. ASCAP & BMI increased royalties by 10%. The seminars designed to teach you how to compete with big artists are contrived, you don’t need that, the industry is happening more now than ever before.
Emily White: we handle all our artists social networks, I don’t know why you wouldn’t. To me it’s a no brainer. If you are outsourcing social networking you are missing out on your fans. No matter how amazing your music is, people still won’t come. You have to write back to every fan, respond to every fan email. What works? we are working. The industry is working, the artists are working. My artists make money every quarter from SoundExchange, TuneCore, and the rest.
Moderator: You can’t make a lot of money from a website…right?
Emily White: Sure you can. We had an artist with one friend on myspace. Within 2 weeks after launching basic online marketing techniques, his sales tripled. I was schooled under jambands and I worked at Madison House, so I’m used to doing it on our own. All of our artists own their rights which is extremely important.
Jeff Price: What’s working is monetizing the fan.
Moderator, to Larry Marcus: What are the characteristics that you look for in startups?
Larry Marcus: We do consumer and enterprise. On the music front what I really love seeing that whatever the product is, it’s generating a tremendous tremendous excitement. If you can have a service that is going to be mass market then that gives you capability to really figure it out. What I don’t like is companies that are trying to make money off of content sales. It’s really exciting to see the explosion in social because music is a social activity. How do you get paid? drive the revenues, ultimately.
Larry Marcus: The labels should do what they are doing in reverse. instead of saying “hey take your venture capital and give me advances” they should turn around and give advances to the startups.
Jeff Price: The music industry is based on 6 basic copyrights. The minute you create a format, under the US Constitution you immediately get those six rights. Nobody can use it without your permission without negotiation. Know your rights.
I Asked: Larry Marcus, can you explain how labels would give advances to tech companies when they can barely afford to give advances to talented artists?
Larry Marcus: work with a partner to navigate what your fans want and there are incredible ideas that can allow users to consume. will there be bad apples? sure.
(he didn’t answer the question)
Moderator: Is the concept of an album cycle gone?
Emily White: Sort of. It makes sense to do a nice big push on something an artist has worked hard on, but the traditional album cycle doesn’t apply as much anymore at all.
Audience Question: What about recommendations?
Emily White: Friends are the best, and social network demographics are climbing in age
Larry Marcus: At Pandora we now use collaborative filtering for recommendations In addition to the Music Genome Project.
FOLLOW-UP: Mr. Marcus wrote to me to let me know he also said “In addition to the Music Genome Project” – I was in the back of a very large packed room, the only spot I could find an outlet, and didn’t hear it. I have since added it to his remarks. I spoke to 2 other attendees who confirmed. Thanks for the correction, Larry!! I’m a big fan of the genome.
FOLLOW UP: I asked Pandora CTO Tom Conrad if the genome has been abandoned. Tom says No, and explained how the algorithms work: “Many years ago we started incorporating other techniques into our station algorithms, particularly those that incorporate your personal thumbs up/down feedback into the results, as well as those that take into account the preferences of other listeners that listen to the same stations as you. We think that the real magic is combining all of these technique into one solution — no single approach leads to the best possible outcome.”
2:42pm
Panel: Handheld & Wireless Strategy
Moderator: Ted Cohen, TAG Strategic
Panelists
Aric Kurzman; Mobile Roadie
Adam Mirabella; Nokia
Chris Phenner; Thumbplay
Daren Tsui; mSpot
Audience Question: How do artists get paid from plays online?
Ted Cohen: The stations track the plays
(i think he meant to say “you need to register for SoundExchange“)
Ted Cohen: A well curated podcast is more valuable than individual downloads.
Chris Phenner: We learned a lot from ringtones in terms of how to deal with carriers. The relationships are now direct with carriers.
Moderator: I’m enthralled by the Windows 7 Phone, how many have played with it?
3 people in a standing room only room of about 55 people raised hands
Ted Cohen: Where is the windows platform in a few years?
yelled from audience: “nowhere!”
Daren Tsui: The carriers have a lot of weight. If they stand behind a platform, good or bad, that platform is going to have legs.
2:28pm Panel: The Startup Cycle
Moderator: Jeff Yasuda, Blip.fm
Panelists
Dan Kantor; exfm
Michael Merhej; Audiogalaxy
J Sider; Root Music
The panel started out with each panelist describing “the napkin story,” or how they got an idea and started to expand upon it.
Moderator: music is a difficult space to get funding although it seems like everyone in music (laughter) is getting funding these days. Can you share your experience?
Michael Merhej: bootstrap initially for a couple years. With folder share we did corporate financing. I like it, as it is a strategic investment. It was basically taking our product and putting it on their hardware. The dynamics look good on paper. It was tough working with a company who didn’t have their own house in order. . .especially when there’s ten of them and one of you.
Dan Kantor: The first company I started was really really bootstrapped. I didn’t like the idea of giving anything away, I never raised money for that and it was, honestly, a huge mistake. For esfm we raised from Venture & some angels. In between those two experiences I heard something that resonated. If you believe that someone is going to help you get to the place you want to get to, don’t be afraid to give them a portion to help you get there. If you have a set of investors who completely understand what you want to do then those are the right investors. You need an office and money to continue to do what you want to do.
Dan Kantor: It’s not unlike being an artist.
J Sider: a lot of the right people won’t sign your NDA. It’s more important that you get their advice, depending on who it is. Go with your gut. If you’re worried about sharing your idea it will be tough to talk to people who want to help you move forward.
1:53 PM Panel: Live and Online
Moderator: Jon Luini; Chime Interactive
Panelists
Gabe Benveniste; CEO SonicLiving
Rick Farman; Superfly Presents
Tamara Mendohsohn; Eventbrite
Sean Porter; Ticketfly
Jason Ross; The Bowery Presents
Rick Farman: As event producers we know there are people who cannot come. You have to understand as a producer that you are working with art. Build demand.
I asked about panelists’ experiences with Jazz and/ or classical music; classical and jazz are live-based genres. I asked if any panelists had any experience with either genre and whether or not new methodologies work; conversely, have they have gleaned knowledge from a 900 year old live genre. Here are there answers:
Gabe Benveniste: Jazz & Classical aren’t relevant genres.
Jon Luini: Classical has never translated to Radio, it’s only a live genre.
Jon Luini: With classical you know every note that’s next. Jazz is highly improvisational.
Panelists were unable to address either genre, as the moderator moved away from the topic, but the audience in the room seemed extremely interested, shouting out comments to the panelists and nodding or shaking heads.
FOLLOW-UP: multiple members of the audience thanked me for asking about Classical and Jazz. I also caught up with Gabe Benveniste during the cocktail hour. He had more to say, and had been cut off by the moderator. Gabe is a fan of both Jazz and Classical, but expressed an interest in the different needs of each genre. I’ve contacted him for a follow up interview.
11:17AM
DURAN DURAN!!! at 11:30AM in the Sakura Room, we will get a sneak listen to the new Duran Duran single All You Need Is Now (produced by Mark Ronson). Not here? Don’t stress, It will be available very soon for you to hear on iTunes…
—-Break—–
Panel: Engaging Your Community
Moderator: Brenden Mulligan, SonicBids/ Founder Artist Data
Panelists:
Meredith Chin; Facebook
Chris Danzig; Indaba Music
Mike More; Headliner.fm
David Meerman Scott; Author
Chris Vinson; Bandzoogle
The panel moderator expressed an interest in focusing on engaging the audience instead of growing the audience, but I think in the social digital environment the two are the same. So I asked…
How does a fan go from a plateau of 1500-3000 fans to 20,000 fans?
Mike More: Use Headliner.fm to find like artists and their fans.
Merideth Chin: It comes down to content. Whether you have 200 fans or 10,000 fans if you’re engaging you’re audience it can go much further.
Chris Vinson: Smaller act fans should continue to connect with their current fans, constantly.
David Meerman Scott: In order to get 20,000 new fans you have to do 2,000 things that generate 10 new fans. It’s like riding the eliptical every day for 20 minutes until you’re 49 years old. You’ll feel better when you’re 50.
Panel: Connected Devices
Moderator: Michael Papish; Rovi
Panelists:
Lucas Gonze; MOG
Thomas Meyer; Sonos
Ty Roberts; Gracenote
Geno Yoham; Winamp for Android
Moderator: What are your favorite devices, don’t name your own
Thomas Meyer: xbox 360, Roku, my iPhone
Lucas Gonze: my dish receiver, because there’s a channel 00353, and i love MOG, we still don’t have The Beatles, but we need to integrate everything into one place
Geno: Android and dropbox
Michael Papish:Once you move to streaming world, the connected devices become much simpler. It will be interesting to see if the video world moves past music even though the files are more complicated.
Ty Roberts: The next generation of music services is locker service. i think you’ll see from major leading providers that solution for the industry, it’s coming, The Beatles will be everywhere. It’s coming.
Moderator: What is the business future for connected devices?
Thomas Meyer: 35% of our customers once they buy a Sonos product come back and buy more within 30 days. We are getting competitive revenue from an existing customer base. We try to offer our customers all the music on the planet. We don’t take a penny out of any of these service integrations. We want to give our customers everything they want.
Moderator: How about the others on the panel, how tightly is your business model tied to hardware?
Lucas Gonze: the consumer electronics industry is not like the web industry. In consumer electronics it’s credible to say you run one program on your samsung and another on your visio. People don’t really want to pay attention to service providers, just the device. Connected devices are about the way the internet collides with consumer electronics. It’s traditionally a very orderly industry moving from one committal technology to the next. It’s a totally different way of doing products. At MOG we are an internet music company and the concept of interoperability is a new thing in this space.
Mod: How do you operate in a world where Apple dominates the fusion of hardware and software?
Ty Roberts: Some manufacturers want a closed store, some want an open store. The standardization is going to come from Android. The Android is a big deal. Google TV has apps. The business model is a little tricky. Vendors will figure out there’s a business to be made around your desktop. When you buy a PC right now, the virus software on there is paid for. There are so many services about to reach the market, it’s not all Apple.
Moderator: How do you operate, Lucas, when you see so many new devices?
Lucas Gonze: We are looking to support and profit from the growth of new products. Any consumer electronics manufacturer who isn’t talking about html5 outside is talking about it inside. We don’t benefit from taking sides on vendors, our users benefit from good choices. We have done MOG on chumby. We want to support them all, but in practice we rely on standards to make choices about platforms.
Thomas Meyer: Standards are starting to come, with app stores on TVs, but I think we are still very far away.
Mod: How do you teach the consumer what your product does?
Thomas Meyer: we plug into devices they already know, like their iPhone or iPad. Same with Pandora, we’re doing a ot of marketing on Pandora now because we don’t have to educate people about what Pandora does, they already know. So we say Hey, you love Pandora, you love Sonos.
Lucas Gonze: You can also think of different rooms in your home as different platforms. Your kitchen has water in it. When you are reading in bed, you can’t type on a keyboard like you can on the couch. I think there will be specializations for different living situations like entering text with wet hands. In music context, people want to name their playlists. But when you are chopping onions, and you hear something you like, and you want to save it to a playlist…well, the new design environments create problems we have to solve.
Geno Yoham: the design challenges are more in the software than they are the hardware.
Thomas Meyer: it’s easier to create a greate remote than it is good software.
Audience Question: What about Bandwidth? What do we do when we have more than we can consume? And what about mashing up content?
Lucas Gonze: The internet will break next week
Michael Papish: content wasn’t the first purpose of the internet but we have abilities to increase capacity. Fighting over costs, of course, someone has to pay. If you are using tons of tons of bandwidth, it’s expensive.
Lucas Gonze: In the space of connected devices customers are used to paying a fee.
Audience Question: How do you choose what companies you do deals with?
Ty: You need to be legal and have enough users.
