2016: The Year in Charts

Is Tech's Future Music's Past? Why Silicon Valley Is Looking to Music Execs

Paul Tuller
           

Every time that Spotify’s Troy Carter meets with a label ­marketer, he hears the same thing: “How can I get No. 1 on Today’s Top Hits?” He has to explain, calmly, how songs are placed on the service’s most popular playlist, which has 11 ­million followers and is meticulously curated by senior content editor Mike Biggane based on a combination of songs’ popularity on other playlists and his own instincts. In other words, the old rules don’t really apply.

“When you look at radio, when you look at retail, we’ve pretty much been working records the same way for decades,” says Carter, the former Lady Gaga and Meghan Trainor manager who was hired as the streaming giant’s head of creator services in June. “A lot of partners were trying to treat Spotify like a traditional retail account. It’s not. It’s its own thing.”

Carter -- like Apple Music’s Jimmy Iovine and Larry Jackson, the Roc Nation team that largely runs Tidal and, as of the last week of September, YouTube’s new global music head Lyor Cohen -- is well situated to translate streaming services to people who speak only music industry. During the past few years, the music business has turned into a battleground between rival streaming giants and record labels, with skirmishes breaking out over exclusives (like when Frank Ocean used Apple Music to break his label deal with Def Jam/Universal in August) and copyright infringement (YouTube has been fighting with artists and labels over how stringently it polices unauthorized songs).

Streaming companies crave effective, articulate diplomats to deal with these kinds of issues -- “The technology companies have been forced to admit they don’t know how to deal with ­talent,” says Dixie Chicks ­manager Simon Renshaw. But are people like Cohen and Carter right for the job? The hard-charging Cohen, ­formerly head of Def Jam and Warner Music, has been such a cutthroat presence in the music business that his former boss, Edgar Bronfman Jr., said in Fred Goodman's 2010 book Fortune's Fool: “In the best way, Lyor’s an animal.” And his hiring may not exactly soothe those music executives who have worked with him.

“YouTube has never had ­relationships with anybody in the music business,” says a source who worked at a major label. “Then they hire Lyor, and the one thing that’s on Lyor’s mind is how to take out the guy he’s reporting to, because that’s his history. I don’t think he’s there to help the music industry at all.” Counters another insider: “YouTube just changed its entire complexion ... from predictable to anything is possible.” (Cohen and YouTube declined Billboard’s requests for comment.)

“We are looking at a shift in the consolidation of the business,” says one former label exec. “You have Jimmy, Lyor and Troy, who are radio-oriented people. Apple has made moves with Beats 1 to a radio-centric kind of model, and Troy has made promotions-oriented changes on the content team. What that signals is that the streaming business has matured, so I think you’re going to see more radio people coming over to the streaming services. And since eventually there won’t be any CDs or downloads to sell, labels' sales and promotion departments will consolidate -- with the potential for promotion teams to become the power bases at labels.”

Of all the streaming ­companies, YouTube has the rockiest ­relationship with artists and labels. In open letters in 2016, top artists and ­managers from Taylor Swift to Paul McCartney to Irving Azoff have complained that the service pays insufficient royalties and could be much more effective at ­removing unauthorized ­content. In their responses, YouTube ­executives often have come across as ­standoffish, if not ­belligerent -- ­qualities that some hope Cohen changes. “It’s clear to me that YouTube really doesn’t ­understand our business, so now maybe they’ll learn,” says Dina LaPolt, attorney for Fifth Harmony and Deadmau5. “The music and ­technology ­communities need to speak each other’s languages, and to have both sets of people at these companies really helps. So bring it, Lyor!”

But skeptics are quick to remind that it wasn’t so long ago that Iovine and Cohen were two of the world’s most powerful record executives when the music business said “Hell no” to Napster and file-sharing, going down a self-destructive path of ­dwindling CD sales and eventually giving away the download ­business to Apple’s iTunes. Many in the ­industry wonder: Are these really the best people to usher in the future of the music business?

Electronic Frontier Foundation legal director Corynne McSherry provides a brighter outlook. “The way the music industry responded to Napster was profoundly ­mistaken -- they just went to the lawyers instead of talking to the ­business development people. Smart music executives may be slow to learn, but they can see the future. They may have made mistakes, but they’re not stupid.” 

Additional reporting by Ed Christman.

This article first appeared in the Oct. 15 issue of Billboard.