As the year comes to an end, our CBO Chris Cass reflects on the most interesting developments across the music and entertainment industries in 2018, and explains how Synchtank is continuously evolving to solve the biggest challenges facing both IP holders and IP users.
“These go to eleven” is almost definitely not what the wise-old-folk-of-the-music-industry said when Spotify came-a-knockin’ 10 years ago. Although not the world’s first legal music subscription platform (that was probably Vitaminic c.2001), it’s been a decade since Daniel Ek and his team rightly calculated that the way music-outsiders build a legitimate consumer business is by giving equity to the brand owners.
And let us not forget, it wasn’t that long ago (the 1990s to be precise) that the mp3 was the equivalent of a red-hot poker being shoved up the music industry’s backside. So much has changed since reading incredulous reports in the trade press from music executives curiously endorsing a Swedish third-party during invite-only beta-testing, it’s difficult to know where to start.
One of the beautiful things about working at Synchtank is we get to see – and hopefully solve – all kinds of problems on behalf of our customers, be they bedroom startups or major corporations. At its core, Synchtank provides a dedicated in-house platform for our clients to host and find music and video, as well as tools to license and manage such IP. But 2018 saw us get involved in substantially more than that.
Once you get beyond everyone’s ubiquitous need to pitch and monetize through sync, other issues of importance from other departments start popping, and these need to be dealt with. Basically, to use good-old sales speak, “needs get expanded”.
I would say that our biggest focus in 2018 has been metadata. There was a time, not so long ago, when very few people in the entertainment industry seemed to know what was meant by the term “metadata”. Now, rightly or wrongly, we have people with “metadata” somewhere in their job title. In fact, “metadata” has become so nuanced that it can mean different things to different people.
When we talk about metadata at Synchtank, we are either talking about descriptive, semantic tags or audio fingerprinting that can be applied to individual songs to help with “discovery”, or data around rights ownership to help with “compliance”. Whereas descriptive metadata tagging has been around for a long time and is used to help power industrial grade services like Spotify and Apple Music, and to help improve the user experience across TV, movies and even sports, the metadata around digital rights has only recently exploded.
There are currently more global rights databases cropping up than I can shake a barcode at, but when it comes to registering entertainment at inception, metadata is now taken very seriously. The entertainment industry is finally becoming more proactive and hygienic when it comes to metadata management.
The association of IP in the digital age, e.g. the taxonomies linking artist to album to TV show to movie to tour date to merchandise to VR experience to image rights on a global scale is now so fluent, and has the possibility of becoming so seamless, that IP needs to keep up with it all.
Although the underlying IP is not really changing, how it is captured and monetised most certainly is. The entertainment business has gradually gone from ownership to access. The public has had access to physical media for only about 90 years. Now they no longer actually need it, unless they like collecting artefacts to help with their definition of “self”. Originally it was sheet music and people gathering around pianos with the birth of publishing. Now it’s handbag karaoke on your handset.
Entertainment has become a commercial utility you can simply turn on and off and back on again, just as predicted in the 90s. It may feel “free”, but it isn’t. It has not been devalued – if anything, its value has increased. OK, tell that to someone with a recent royalty statement, but often that’s because the payments are going through a multinational middleman. Plus, we’re still in the early days. The industry has unfortunately yet to catch up. But witness the proclamation that it’s 2018 and we are in the “Golden Age of Television”. Drive around Hollywood and look at the billboards if you don’t believe me…
Apple, Amazon, Tencent, Netflix, Google et al. have emerged in Spotify’s wake (with Comcast, Facebook and Disney to come), and with these streaming services making monetizable content “easy to consume”, the pay-off comes with the sheer increase in the volume of consumption. Accounting reporting lines (and ultimately how creators get paid) have expanded manifold – to the extent they are becoming almost unmanageable. Synchtank is here to provide a platform to license music (that is our heritage), but we also can help with the management of digital content in general.
Imagine a major Hollywood studio (we work with four of them). They’re used to licensing songs from various rights holders to put on a physical soundtrack which gets shipped into stores, and then reporting royalties based on physical sales and returns. But these “sales” are now mostly online, and songs on albums are streamed individually rather than “sold”, meaning the soundtrack has disseminated. Now the challenge is to collect line items to figure out what is owed to another rights holder for a movie made maybe only 10 years ago, and whose contract is in a cabinet in a warehouse. Synchtank, among other things, goes a long way in replacing that dusty filing cabinet. The opportunity for efficiencies is obvious.
So now, a few well distributed streaming services are billion-dollar companies thanks to both the great content served combined with associated descriptors. Return-path data gives far more insight into consumer behaviour than selling a dumb TV out of Best Buy ever could. With hours and hours of more content relentlessly being created and consumed every passing second, it is time to complete the circle and see how entertainment IP holders can exploit their rights efficiently, and how IP users can ensure compliance so that budgets can be better controlled.
Synchtank’s solutions provide value to those digital citizens in their bedrooms creating their own music, right up to the board rooms of corporate enterprises managing billion-dollar movie and TV franchises. Throughout 2018, Synchtank has brought efficiencies to not only those pitching and acquiring syncs, but also to those looking for royalty reconciliation against catalogue and wanting to save time spent on ledger entries. That’s cutting time down from months to days. Whilst integrating with other software platforms via API, we are a centralized hub for a host of activities far beyond sync.
In the digital world, IP assets are as valuable as the IP metadata associated with them. Our processes and solutions developed in 2018 now help shine a light on what IP is registered and its performance in-market. Missing registrations, for example, are therefore easier to spot. Once content is identified and associated with the correct rights information, it is easier to attach the earning and projected value on that asset. Aggregated as part of a catalogue, you get a better indication of its worth as a sum of the parts.
Even where Spotify got consent in the beginning, the brand ownership has changed as creators these days no longer need to relinquish this to the corporate machine. There are emerging artists who are experts at marketing themselves on social media to get the instant streams. Some regrettably are also experts in self-snitching and getting imprisoned on RICO charges, but that’s a different story. Nonetheless, the definition of what is a single and what is an album (often now referred to as “projects”) are blurring. Anything that is current, online, has a video, and can go viral helps to promote the brand.
Rap is now the dominant musical genre and the constant sparring online between rivals in this genre grab the eyeballs and attention spans, which, in the world of data, is often more valuable than direct sales. Musical genres have become less tribal. Hits on mainstream radio today would have been considered esoteric or even avant-garde a decade ago. Easy access to entertainment and social media has broken down the barriers that kept musical factions apart. The wallet is no longer a real factor because music often feels free even though it technically isn’t.
Radio has also been completely re-defined as its programming lacks the immediacy of on-demand playlist streams. It no longer pushes the agenda. Mobilized self-promotion via Instagram is in the hands of the artists themselves, and there are numerous ways of accessing expert label services without signing to a major or an indie. YouTube channels that are tastemakers and influencers are becoming pretty much the story itself.
Music service platforms themselves are opening up for the bedroom artist to sell directly to fans. They are becoming the operating systems for music, just as some of them set out to be. Legacy acts such as Led Zeppelin have announced forthcoming direct to consumer streaming services, a logical way to get closer to the user and access data. It’s significant progression from sticking a mailer card in an LP to join a “fan club”, yet the motive is identical. A dedicated artist music service is not unlike a skinny bundle for a TV entertainment package – why pay for a load of content you don’t actually want? And of course, the crossover appeal between music and TV is enormous.
2019 should be an interesting year for the entertainment industry and Synchtank is looking forward to it.
About the author: Chris Cass is Synchtank’s Chief Business Officer and his main hobby is working to editorial deadlines.