‘The essential dynamic between streaming providers, artists and labels continues to be not what it must be.’
MBW recently interviewed music industry legend Jimmy Iovine for our “Greatest Producers” series in the world (supported by the Hipgnosis Songs Fund).
It was a fascinating glimpse of how Iovine’s time in the studio influenced his attitude and strategy for the rest of his career. But we couldn’t leave it at that.
That’s why we asked Iovine about some of his thoughts on the music industry today (and tomorrow), the future for big labels, the challenges streaming companies face – and what it’s like to be out of the game after the tip of it as long as …
What would your priorities be if you ran a big label?
To start with, I would involve real entrepreneurs, give them the ball and let them go. I had this relationship with Universal and some great things came out of it.
I would definitely focus on gaining access to the customer, owning my customer and not letting third parties control the customer.
Throughout history, be it on record stores, MTV, iTunes, or streaming services, for some reason the record industry has always been comfortable having someone [own] the relationship with the customer.
Is there a problem right now with the way and the amount that artists and songwriters are paid in this streaming dominated world?
I’m not trying to oversimplify a very complicated problem, but the basic dynamic between streaming services, artists and labels is still not what it needs to be.
Technology and changes in culture have made artists want more of their rights. That in turn forces changes in the economic relationship with labels in general, but that doesn’t mean that not everyone has a place – it just means [the] Balance will shift.
“Technology improves the artist’s ability to communicate directly with their audience. It is very powerful. This will change the entire ecosystem – and benefit from it. “
Technology improves the artist’s ability to communicate directly with their audience. It is very powerful. This will change the entire ecosystem – and benefit from it.
I always felt that we had to do more to keep our value in the chain when I ran a label myself in the early 2000s. Interscope had to do more, labels in general had to do more to maintain their relevance.
Would you be optimistic if you were still in the major label system or would you be afraid?
I wouldn’t be afraid; I am always optimistic. I would be aggressive; I would kick off.
By that I mean, I’d look at what’s going on in technology, what attitudes exist within the artist community, what realities sales have and what to do, how I’ve structured my business and who I’m related to Artist goes on.
This touches on a question that is very popular in the industry today: What role does a modern record company play?
I do not think so. I would just say, “Okay, that’s what the zeitgeist tells me and how are we going to adapt?”
I don’t want a question like “What does a record company do?” Ask or answer. I think it’s the label’s responsibility to face something like that.
In other words, I would ask – and answer – before anyone else.
What is the future for streaming companies?
I don’t think as a utility company they are maximizing the potential [of their platforms].
How can you improve the margins of streaming services as a utility? Because the fixed costs remain fixed, there has to be something, right? You have to create new forms of income.
“The music streaming services don’t own their content, and that’s a big problem. You have to find out. “
When streaming music, margins are an issue because [the platforms] Don’t own the content, someone else does. Netflix owns its content. Disney + owns their content. Apple + owns their content.
The music streaming services don’t own their content and that’s a big problem. You have to find out.
How do you scale that thing Not in terms of subscribers, but how do you scale it monetarily? How do you make it economically viable? The labels and streaming services obviously have a problem here. But it has to be sorted – or a third party with a new model will find out. Someone will. In any case, the vacuum cleaners are filled.
What do you think are the differences between the music streaming services out there today?
There aren’t actually any above 30,000 feet. They are all very similar. All great services but for me to scale them they need real differentiation.
For one, Trent [Reznor] and I’ve always felt that streaming services should have a social aspect. That is still very important to both of us.
What impact do you think Universal’s potential listing will have on the industry?
It means that some people will make a lot of money. I don’t think it matters at all.
What do you think of the trend for songwriters – some very famous songwriters – to sell their catalogs when the golden rule was never to sell?
Well, when you get to these prices, the golden rules change.
They obviously think that this is a time in their life and career when they can make an extraordinary amount of money.
And what is the company’s motivation for collecting these catalogs?
You’re … very bullish [laughs].
What is the main reason to be optimistic about the future of the music business?
I think the artists really have blue skies ahead of them. The direct relationship between the artist and the consumer, the stronger it gets, I think that is going to be really very, very positive for the artist.
And whether to watch the streaming services and labels [that] As an opportunity, I believe it will be great for everyone.
What is the main reason to be pessimistic?
If nobody does anything, if they try to protect the past, if everyone just says, “I like this model and I will do everything I can to keep this model”, nothing goes.
“If there is a desire to keep things as they are, I wouldn’t be optimistic. this is not going to work. “
If there is a desire to keep things as they are, I wouldn’t be optimistic. this is not going to work
How do you enjoy retirement?
I honestly can’t tell you how much I love it.
“Really?” I didn’t think you’d do it.
None of my family members thought that either. I worked a lot; I have prepared for it. I realized that I just wanted to quit. I’ve always tried to do what felt right to me and what felt right to me at this point in my career was pulling up.
There must be things that you miss when in the music business?
No, there really isn’t. I’m not averse to investing in music, I just don’t do it myself.
You really don’t miss anything?
I’ve been lucky enough to try a lot of different things in my career: producing recordings, having a label, starting a headphone company with Dre, and building a streaming service at Apple. I never try to look back.
Dre told me something a long time ago, and that applies to me at work as much as it does to society. He said, “Jimmy, you don’t want to be the old man in the club.”
Right now I am enjoying being the old man in life [laughs].Music business worldwide