Tag: Music Industry

Thoughts from a Working Musician In Nashville

Posted on | by Justin Ahmanson

“Nashville has a long history of songwriting.”

This was something that I heard over and over when I moved here in the fall of 2017. At the time, I didn’t understand that this statement was actually an insight into how the music industry operates. To me, the word “songwriter” wasn’t much different from the word “artist” or “musician.” I had grown up playing songs by my favorite artists as well as writing and performing my own songs. It was all music to me. It wasn’t until later that I realized the music industry operates on some very clear distinctions – particularly in Nashville.

One of the first shows I went to in Nashville was at a down home type venue called Belcourt Taps. The show was an “in the round” style showcase where four different songwriters sat on stage side by side and took turns playing a song they had recently written. I had never encountered this type of show in Austin where I had moved from, but I got the sense it was standard practice here. To my surprise, one of the songwriters, in particular, was a very bad musician. His guitar playing was filled with missed notes and he struggled to sing in tune. But what was fascinating, was he didn’t seem to care at all. He was more interested in the audience, trying to gauge their reaction to his songs. I quickly realized that he had no interest in performing these songs on his own. His goal was to refine his songs down to their most entertaining form – that three-and-a-half-minute gem. It reminded me of how a comedian works on a joke over and over until he or she gets it just right. This was my first insight into how the music industry makes a clear distinction between artists and songwriters.

About a year later, I began working for Muserk as a software developer. Muserk is a global rights administrator that leverages technology to perform its duties with an exceptional level of speed and scale. I was intrigued by the opportunity to combine my tech career with my love of music. Furthermore, it was a chance to learn more about the business side of the music industry, something I thought would be useful in my own music endeavors.

As soon as I started, I was thrown into (sink or swim as the saying goes) the very complicated world of rights management. One of my first projects was developing what would later be known as M-Match — our proprietary AI technology used for finding works in the vast ocean of DSP data. Through this I then learned the intricacies of one way the music industry makes money.

The music industry makes money from two copyrights: one for the underlying work or composition and the other for a sound recording. In practice, there are two types of businesses that form around this: publishers (songwriter/work) and labels (artist/sound recording). So, if you have a song playing on Spotify, let’s say, a portion of the money that is generated from that song should find its way to the label/artist and a portion should find its way to the publisher/songwriter/s. You may think (as I did) that a company like Spotify would know all of this in advance and take care of it. That is not the case.

One of the big problems is that the label and publishing worlds don’t really talk to each other. So, a label will push a song to Spotify and not provide (and in some cases even know) any information about the underlying songwriters. Therefore, Spotify won’t know where to send the publisher/songwriter portion of the money. This is a fairly simplified but accurate account of what happens.

This is where Muserk shines. We spend most of our time matching songwriter related metadata to sound recordings so that we can collect and distribute the appropriate royalties. In the age of digital music this isn’t an easy task. We use all kinds of technology, processes, and insight to match as much data as possible. We’re constantly trying to innovate so that we can match works fast, accurately and at scale. I spend most of my time building this technology and creating ways to convey its results. I feel proud knowing that the work I do contributes to getting musicians paid what they’re owed.

As a musician, my time at Muserk thus far has opened my eyes to how the music world really works. I’ve learned that businesses dedicate themselves entirely to very small pieces of the industry. In Nashville, for instance, there are networks of people that are just trying to write the next hit song and could care less about recording or performing it. Concurrently, there are networks of people trying to be the next big artist and could care less about writing their own songs. For me, I’m still trying to figure out where I fit in. But having a broader understanding of the industry as a whole I know will help me navigate my own musical journey. And, of course, my metadata will be correct.

the next hit song and could care less about recording or performing it. Concurrently, there are networks of people trying to be the next big artist and could care less about writing their own songs. For me, I’m still trying to figure out where I fit in. But having a broader understanding of the industry as a whole I know will help me navigate my own musical journey. And, of course, my metadata will be correct.

The Math of Matching – Part 1

Posted on | by Hans Peter Roth

Streaming music leaves rights owners – particularly the publisher, society, composer, author groups – with two major challenges. First, the Digital Service Providers (DSP’s) like Apple, Spotify, Amazon, Tidal, Deezer, Pandora, etc, can send anywhere from 1.5 to 5 million different tracks in a monthly usage report. The massive volume of tracks used and reported every month has quickly become overwhelming. Second, The descriptive metadata is flawed at best and missing at worst. The information we got from the “liner notes” in vinyl and CD’s are seldom available online. The names of composer/authors are often missing or wrong, even on major releases. 

This is why it is so important for digital rights administrators to be able to both handle vast amounts of data (without “cutting off the long tail”) and triangulate the flawed/ambiguous metadata accurately in order to match all tracks to their corresponding works. Indeed, the ability of a digital rights administrator to master both aspects are key if the rights owners are not to end up losing more when paying less for services.

Below, I will look at the challenges of handling the massive amounts of usage data reported by DSPs and how that affects rights owners collections. In a later post I will focus on the prevalence of flawed metadata and the effect it has on payouts.

CUTTING VOLUMES MEANs LOSING Money

In the year 2000, at the peak of CD sales, 942,500,000 CD’s were shipped in the United States. As an example, let’s assume that each release sold 1,000 copies on average. If each release had 10 tracks we would be dealing with 9,425,000 unique tracks in the year 2000 alone.

As high as that number may seem, it is only what roughly represents one or two monthly usage reports from one DSP for one product tier! In short, what was once years  if not decades of usage data is now reported every month in the digital music industry! Indeed, I have previously calculated that the online music data volume in the Nordic region rose from index 100 in the year 2000 to index 112,500 in 2013 – and that was seven years ago!

So how did the industry cope with this increase?

Well, when 90-95% of value can be found in the first 20-40% of used tracks (cf. above between 300K and 1,600K tracks), it was, and is, “easy” to simply not analyse the remaining 1,200K – 2,400K tracks for the last 5-10% of value. Particularly since it simply became too expensive and/or time consuming for the rights owners/administrators to analyse the data in the tail. Hence it became an industry standard solution to “Cut off the Long Tail” when processing data, and focus only on the lucrative part in the “hits” section.

While this solution saved you 60-80% of the workload, this also meant that rights owners said goodbye to 5-10% of revenues in an otherwise equal scenario! Even then, we know that not all the remaining 20-40% of data was or is always processed.

Leave No Bit Behind – MPAC to the rescue

When we set out on Muserk’s voyage to become a leading global digital rights administrator, we set the goal that our back end had to be able to cope with all the data volumes.We were going to leave no stone unturned – leave no bit behind. Not only do we believe that everyone should get paid correctly, we also believe that our customers and their rights owners have the right to know when their work was matched but did not generate (enough) money to warrant a distribution. As our Head of Technology, Collin White, put it; “we have to carry the zeroes as well as the heroes”.

So that is what we did. Today, our proprietary scaled cloud infrastructure, MPAC ( Muserk Primary Automation Cortex), enables us to handle a multitude of workflows simultaneously. This enables Muserk to process tens of millions of reporting lines in less than an hour. To draw on our example of CD’s in the year 2000, Muserk processes a year’s worth of data in less than an hour or more. That’s two decades of data in less than a day! At Muserk, we are able to look at every single reporting line, every single track, every single bit and match it to our customers repertoire. And, from first-hand experience, we can see the difference that makes to our customers and their earnings.

Money Spent Is Actually Money Earned!

“So how does this affect my collections?”, you may ask. Well, in an industry where the average commission rate is typically between 10% and 20%, finding the 5-10% of value in the long tail makes a huge difference when calculating the actual value of a service. In fact, you can very easily end up with less money by paying a lower service fee.

For example, rights administrator A charges 11% commission, but cuts off the tail and only finds 90% of value. This leaves you with about 80% of your copyright value, and with no visibility of the long tail. Thus, you have no idea which works represent 10% of the value of your rights, how they are used, by whom they are used, and where your usage is coming from. Conversely, rights administrator B charges 19%, but does not cut off the long tail. Now you are getting 81% of your copyright value plus full granularity on all usage! In short, the true value of a digital rights administrator is more than its price tag. That is true when you look at volumes alone, but even more so when you include accuracy.

More to come

In my next blog post I will look at how the ability to accurately triangulate the flawed metadata of the online industry further augments the example on price and value above.  Stay tuned for more! In the meantime, feel free to check out some of the other Muserk blog posts.