This podcast is for musicians, music fans and those interested in the legal side of how the music business is run in the 21st century. Our guest is music law expert, Chris Castle. Chris advises creators in the music industry, he represents innovative music tech startups, as well as mature technology companies, and he addresses public policy. Chris has spoken in front of the US House of Representatives and the UK Parliament and he has worked with everyone from Sony Music to the founder of Napster.

So if you’re considering a career in music, or if you’re already in the music business and you want to arm yourself with more knowledge, this chat is for you.

The Colaborator Podcast is an in depth conversation with luminaries in entertainment, tech, and other industries about the convergence of media and technology.

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- Is this a good time for an aspiring musician to get into the business and to make music?

- Well, it's the best of times and the worst of times, you know? It's a good time if you're a certain kind of artist. In other words, if you're someone who is real engaged in your business and willing to devote time to it, and is willing to do all the marketing that you have to do now…bearing in mind that the, what we used to call artist development window has gotten pushed way out. So, most of those early days, efforts that labels used to underwrite—A&M, I mean, for A&M Records, it would've been unusual not to stick with an artist for two or three and sometimes four albums before they found that audience. We let Sheryl Crow make her first record twice.

- Wow, okay.

- Right. Never would happen today, right? So that kind of thing just doesn't happen anymore because they don't have the money to do it for a variety of reasons, right? Not the least of which is the pyramid. The upper part of the pyramid I think is sucking a lot of that money out of the places where it would be better spent. But, be it as it may, it requires a certain kind of person now who's willing to do that. Bob Dylan, or someone who just wants to write songs and perform and be an artist, do the things an artist does—is probably going to struggle a lot now. Because they don't have that infrastructure to fall back on. On the other hand, if that person can get comfortable and can afford to devote a chunk of their time everyday to their social media platform, reaching out to fans, booking gigs, promoting gigs, and they can find different ways either through patreonism—John Pointer is a local artist here, started this company called Patreonism which was essentially what became the patreon business model. You know, Kickstarter. There's different ways to do this to get the cash that you need. But there's also time. You know, there's time that it takes to raise that cash.

- So it’s: do it for the love, don't do it for the potential money?

- Well, I wouldn't say that. I think that it's if you really are on your game and you really stay after it, you can still make a living.

- But expect to be in it for the long haul right? I mean, I think part of the problem today is that you look around at the world around you, and you look at the success of a 20 something tech entrepreneur for example, and you see how a success comes so quickly. Honestly, those people are anomalies within their own industry. But it doesn't look like it to the rest of us, and it seems as if creatives also want instant success now because you're at least getting to see them. Everyone can be famous now on all of our social channels. That's a problem. I don't know if you can fix at this point, that genie’s out of the bottle as well.

- And then you have the YouTube star phenomenon right? And if you look, most of those YouTube stars make most of their money off of YouTube. So,

- And by off of YouTube, you mean literally not on YouTube.

- Yeah, they make it from brand integration, from sponsors, which are essentially sponsorships if you want to in a broad sense. That's where that money comes from, and I don't know…I don't know if that's really a healthy thing for the music industry altogether to be dependent on corporate sponsorships, although we certainly have become much more dependent on those than we ever have in the past, but it's like I said, it's the best of times and the worst of times. I mean, you have to hold your nose and do some things that if you're a real artist, you're probably not going to be that interested in doing it. So for certain kinds of artists, I think it's a great time. For other kinds of artists, not so much.

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- We all have to agree that streaming has won when it comes to the way people consume, honestly, any kind of entertainment at this point. So, my question is to you about exclusives when it comes to music. Taylor Swift only being on iTunes, Beyonce—the queen bee, head bae, you know, everyone's future wife—and then Frank Ocean, more recently, who is a little lesser known artist but is very popular, all doing exclusives on all the competing sites: Title, iTunes, Spotify—actually, Spotify doesn't do exclusives. That is difficult for a consumer, a fan, because they wanna listen to Beyonce, they wanna listen to Taylor Swift, they really wanna listen to Frank Ocean, who, Frank Ocean, in my opinion, can't really afford to be, at least when you're coming from a fan perspective, afford to be on just one site. It's bad for business. Does this cannibalize on music consumption as a whole to sort of hold out onto different sites?

- I think it depends on how long the exclusive is, and what else you're giving the fan in the meantime.

- Adele, right, I almost forgot.

- Well, but Adele, don't forget, Adele had the most listened to track on Spotify from the time it was the initial release of “Hello.” I mean, she put the single on there free, she didn't just put the album on there free, or at all, and that was the, I think, in the negotiation that Spotify is having now—they're starting to crumble on that point—that you couldn't give them an album, say, just on the premium site. But you know, the problem is that people don't really know. I think if the fan is upset, the fan will let you know. The artist is very in tune, as a general rule, most artists, certainly most commercial artists.

- But how will they let you know?

- Oh, they'll let you know.

- But what are the ways?

- Social media, you'll hear about it.

- I feel like they are letting people know by just finding other ways to get the music without having to pay, which ultimately, again, cannibalizes on music consumption as a whole, in my opinion.

- You know, there certainly would be some of that, I would think, but it's a tipping point. I mean, you're gonna have that anyway. See, the problem with that is that you have that anyway, and if you look at it on a balance and you say, “Okay, well, I'm gonna do this exclusive with iTunes, that's an audience, that's a service that attracts a certain kind of consumer. I think most of my consumers are that kind of consumer. I wanna be on Zane Lowe's radio show, right? I can't be on Zane Lowe's radio show if I don't do the exclusive, or I don't give them some incentive. There's some value to me to being in that situation.” Then that's a decision they'll make. I mean, I respect the artist's decision, you know? If the artist wants to go there, they're gonna go there. And in my experience representing artists, and working with record companies, and working with artists in a variety of capacities for a long time, I really listen to what the artist wants.

- But doesn't it seem like it's just an opportunity to take a lot of money upfront, rather than trying to expand, as an artist, your overall listening base? I mean, Frank Ocean, I mean, I have worked in independent music for a long time, and I really care. I'm interested in it, much more so than the average music listener. Guess how many times I listened to Frank Ocean's new album? Zero, because I don't have the effort to go to a different music service right now. I mean, I'm a Spotify listener. I have not listened to it.

- But you're talking about it.

- Well, I'm also an anomaly in that regard. Agree to disagree.

- No, look, I think there are fair arguments on the other side of exclusives too. I don't discount that. I just say, if the artist wants to do it, they'll hear about it if the fans don't like it. And with Taylor, Taylor probably heard about it from some, but she heard positive things from others, 'cause that is an artist who's really in touch with her fanbase directly. And I think if Taylor thought it was a problem, she wouldn't have done it. But, I mean, I respect her choice to do it, and I really think that, when you look at how people handle things, that right there, to me, the Taylor Swift phenomenon is the prime example of what's different about Spotify and what's different about Apple.

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- I have a criticism of labels, which is different than your criticism of labels, but it's still a criticism of labels. The labels have bought into this idea that somehow giving somebody something…that if you give people something for free long enough, one day they'll say, “You know what? Don't give it to me for free anymore. I wanna buy it.”

- Right.

- And that's the fallacy of the conversion, right? And this is something that-

- Genie's out of the bottle at that point. Yeah, the perceived value-

- Yeah, it's a different consumer. My point about this is if you really believe that Spotify's mission in life is to convert people from the free service to the subscription service, show me that consumer research.

- Right.

- Because I don't think it exists. What they're doing is they're attracting people to subscribe. And you know, they're doing an okay job at that. They're sort of, they're almost at the number of subscribers that Napster had users at the peak, you know? Which is some kind of benchmark.

- So, really quickly, what are…so how many people are on the freemium model for Spotify, and how many people are actual paying subscribers?

- I think the ratio is about…I’m gonna say three to one, free to subscription. It's something like that.

- Okay.