Music + Technology + Random Nonsense from the Music Industry by Ethan Kaplan, VP Product, Live Nation

And I Return

It would have been a very nice month to be off grid to a degree, and disconnected. Except I was not off grid and disconnected. I was hyper connected, very much on grid and mostly exiting the somnambulant stupor I felt I was under for the last bit of while.

I do miss Warner. I miss my office, the building, working next to legends like Lenny Waronker and being around music all day. But being outside of the building has been interesting as well.

A lot of the sentiment I’ve been living under for the past few years has been based on fear. Things slipping through fingers never to be returned. What I found leaving however is that while things slipped through fingers, they didn’t fall to the ground. A whole other ecosystem of hands was there to catch it.

The music business didn’t die. And it isn’t dying. I argue that the human race will have to die before an industry around music fully succumbs. It is changing. Shrinking, contracting and expanding. It is also diversifying and competing for attention and dollars with ecosystems and markets that weren’t even imaginable five years ago. Where one dollar might have gone toward a record before, it is now split between entertainment bills, ad-hoc entertainment, subscriptions and the increased cost of providing us the unencumbered connectivity and freedom brought by devices like iPhones.

When I was younger, even ten years ago, I spent money on my cell phone bill, my Internet bill and gas. Now I have my XBox membership, Rdio, Spotify, Pandora, iTunes apps and music, iTunes video rentals, Netflix, Amazon Prime, Github, 37 Signals, Rackspace Cloud servers, etc. Life takes more care and feeding. And substantially more recurring billing.

This might be deemed a “first world problem” and to an extent that is correct. We are a first world society which extends to that which provides us leisure enjoyment. And to that end, the amount of dollars I comparatively allocate toward recorded music has shrunk as my time has been subdivided by the ramifications of technological progress.

That is all well and good you might say, but the industry didn’t keep pace. To that I say: yes, it didn’t. But, could it? When things become successes, or industries normalize around something (ie, iTunes, Amazon, Facebook), we all become retroactive hockey puck prognosticators. We knew it would be successful, or it wouldn’t be.

To that end:

Yahoo, Microsoft, MSN, Google, AOL, eBay, MapQuest, Amazon, Real and MySpace.

The top 10 websites from 2006 by traffic and audience reach.

Markets move in chaotic fashion. Markets around technology even more so. I lived through the deaths of mediums, and contributed to some. I was working in newspapers in 1996, and saw Craigslist as a potential threat. Others did too. The ones that mattered didn’t. But it remains hard to change large businesses so fundamentally with such frequency and not have it fall apart.

Back to the music business. I still contend that the business didn’t die, because there remains business around that data which in the end is represented as music. When we reduce it all back to core fundamentals: music is the artistic output of noise distilled into data and recombined into artistic representations of what was distilled. The onus of representation used to be on the supply chain monopoly, but now is on the user. The fan.

This was scary for some. And liberating for others.

In the past year I’ve seen the space around music/data/representation go from a very “celebrity” driven culture around marketing to one more pure in its effort to remove distance between those that create and those that enjoy. Where once it was MySpace page design, it now had become TopSpin or open source tools for artist sites. Widgets became Soundcloud, collaboration and community around synchronous enjoyment of music. The DIY model came back with MobileRoadie, Songkick, Soundcloud and others. A whole ecosystem has emerged around being a fan, being a musician, being a band, and hell, being on a major label even.

What is exciting for me personally, as I’m ending my first month away (but not away) is that for many years the music business had a “oh, those kids!” attitude toward the startup community. The divide was bridged by few, but diligent people in the business (ie, Robin Bechtel, Rio Caraeff, EMI’s digital team, E-Labs at Universal, the WMG/WBR Tech department), but the ecosystems didn’t commingle. The participation was on the API key level, but API keys didn’t extend to lawyers and litigators.

But I can see now an ecosystem starting to form that could potentially be as strong as those around SaaS, Twitter, Facebook, etc. A day, hopefully where licensing content is as simple as API key and a credit card. Interoperability of things like playlisting. And hell, maybe some standards.

It is an exciting time to be in the music business. Just not if you were once self defined as in the Business of Music.


Oh, and for those wondering “where to next,” I don’t know yet. I will soon I’m sure.

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8 Responses

  1. Joel Kreager says:

    There is a million dollars or more sitting in that picture at the top. Perhaps there are ways you can work around the need of such, but certain types of music will almost require it. Where will such upfront costs come from – fashion and taste abandon all types of music which require large investments? Music isn’t simply a selection and construction of noise, it is the removal of noise which leaves a pure tone. Melody is a real thing.

  2. Chris says:


  3. “What I found leaving however is that while things slipped through fingers, they didn’t fall to the ground. A whole other ecosystem of hands was there to catch it.”

    That sums up so much about the two wildly divergent views of the music industry. One uses the past 5 decades as a barometer of how far things are falling. The other looks at the field of innovators, startups, independent artists, and entrepreneurs to see that many of us are embracing and encouraging fundamental change. And change, by very definition, disrupts the old system – hence the fear.

    I am also very excited about the evolving ecosystem – both being a part of it and simply a fan going along for the ride. And don’t even get me started about how amazing an API-centered music consumption/licensing foundation will be…

  4. Leonardo says:

    Please post more on the API and content rights- I agree there is a greater opportunity if the interoperability grail can be had. Great post!

  5. Shon Gale says:

    What are you doing now? Your experience in navigating the corporate is extremely valuable. Are you available for consultation? Would love to hear from you as I have a band (of course) and am of the opinion that if you want something done. Go to a professional. Please let us know what you are doing?

  6. Bilal says:

    Ethan, great post, and best of luck on your next step.

    I have one more point to add to what you’ve said.

    I’ve been in the music industry for about 8 years now, between music stores (Virgin) and a major (Sony), I’ve had my fair experience which makes me understand what you just said.
    But I currently live in Dubai, and unlike you, I never get to enjoy any of the online music services that you’ve covered above. We don’t have iTunes, Pandora, Spotify, Rdio, …etc. How does an industry claiming to be dying, keep such services away from half the globe? Record labels are the right owners (at least most of the time), why don’t they want to service a paying customer like me?


  7. Don Schlonzo says:

    the music industry needs a common format for their API and what would also be really helpful for everybody dealing with music: licensing all rights from a single point (not having to go to collection societies and labels) as well as one single reporting format. never understood why every label needed its own reporting format when basically the reports contain the same info.

  8. Pierre says:

    Enjoy the time off Ethan. I see that you are appreciating the fresh perspective that being away from the building brings. I went through the same thing when I left the Universal system. It’s good for you to have that outside perspective.

    I think having the inside AND outside point of view is definitely necessary to be able to truly understand what should be done next for the industry. Lots of companies only have one or the other, rarely ever do they fully understand how both sides work, and it’s one of the reasons that so many business plans are half baked. You will be able to see both sides of the biz which makes you even more valuable outside than being inside of the Ski Lodge.

    I know you have a ton of opportunities in front of you. Good luck with whatever you do man.