TuneCore CEO 'Stunned' by Criticism Over Price Hike, Slams 'Incomplete and Inaccurate' Reports
TuneCore CEO 'Stunned' by Criticism Over Price Hike, Slams 'Incomplete and Inaccurate' Reports

After several weeks of rumors, Tunecore CEO/President Jeff Price announced today that he and Peter Wells have left the company. Price, Wells and Gary Burke founded the company in 2006.

According to sources, the Tunecore board voted to oust Price from his position of president and CEO on July 20, although Price denied to Billboard.biz on July 26 that the board had taken that action.

At the time, sources suggested that he had been ousted because the board was unhappy with the company's financials. Others said it might have been because of the spitting contest he got into with Amazon that saw Tunecore titles removed from the merchant's U.K. website for a period beginning in late January. Still others speculated that the board might have been unhappy because he refused to close deals with digital service providers unless they agreed to pay Tunecore the publishing for the music he distributed. While that might have proven lucrative for Tunecore in the long run, in the short term it meant the distributor decided to forego revenues from companies like Rdio, with which it signed a deal just a few weeks ago, after a year of trying to force them to pay publishing to Tunecore.

Over the last month, the Tunecore board of directors did not respond to repeated requests for clarity from Billboard.biz.

In an email, Wells told Billboard.biz: "Regarding my leaving TuneCore: I wasn't terminated: my position was dissolved. I'm saddened that, at the time, TuneCore didn't find a way to keep me on board, I know I have a lot to contribute. And I'm dismayed I wasn't given the chance to carve out a place for myself either. But I left with handshakes and good-feeling all around, and Jeff was still very much CEO.

"That being said, I certainly didn't want to go. Now that Jeff's terminated, I'm seeing things in a new light, and I'm deeply concerned. My very first title at TuneCore was 'Customer Advocate' -- something we made up, because we wanted someone at the root of the company ready and able to go to bat for the artist. When my position was dissolved, I at least knew Jeff would still be there to fight for artists. We'll have to see if the company stays with the principles Jeff and I worked so hard to instill."

When told of the reports of infighting and asked when things began to go sour at the company, he continued, "Hard for me to tell. I can say that letting Jeff go came like a bolt out of the blue--there was no foreshadowing I could recognize. From the vantage point of my desk, all I've ever seen was Jeff was working tirelessly (that's normal for him) right up until my last moment, and it's all I heard about until his."

In a report on TechDirt, Wells said:

"Jeff is the heart and soul of TuneCore, and frankly, its brains. No one knows this space like he does, especially when it comes to publishing. ... Why on earth would Jeff be asked to leave? Why now, in the face of so many successes, and on the cusp of doing for publishing what he'd already proven he could do for distribution? It makes no sense."

While Price said in his announcement that "Peter and I look forward to continuing to change the industry on a global scale to the further betterment of artists, songwriters and investors and to issuing our next announcement," Wells was less definite when asked about his plans by Billboard.biz: "I got to work with Jeff once at eMusic in the late 90s and early 00s, and again at TuneCore. They do say great things come in threes. I'd count myself lucky if I got the chance again.

"For me, nothing compares to the rush of doing something right. I mean it--my happiest times in business were in the early years of TuneCore, when we felt like we were smashing manacles and building a bridge to freedom for artists. I want that feeling again. Perhaps it'll be in starting my own new company. Perhaps a powerful player ... For now, I'm looking for that opportunity and the right people to partner with to make it happen. If it's Jeff, then watch out, world: we've got a track record together."

2009 Billboard.biz Q&A With Jeff Price

At press time, it was unclear who is running the company, although two weeks ago an assistant for one of the directors told Billboard.biz she had been working with Tunecore's chief operating officer, who is listed on the company website as Scott Ackerman.

Other sources say that Tunecore's former outside consultant and legal advisor Josh Grier had told them he was taking a bigger role in the company, although one source said he had been telling people that he was running the company. However, that source added that it could have meant an interim role until Price's replacement was named. At press time, neither Grier nor reps for the company were available for comment; Price said he had no further comment at this time beyond the open letter, which follows below. Billboard.biz will have more on the situation as it develops.

SXSW Panel Tackles Questions, Perils of Royalty Contracts

Price's announcement came in the form of the following blog post:

An open letter from TuneCore Founder Jeff Price
August 15th, 2012

Peter Wells, Gary Burke and I launched TuneCore on January 25, 2006. Our motto and mission: for artists to "sell their music not their soul." We envisioned changing the global music industry for artists for the better by serving, not exploiting, them. TuneCore's impact was significant and immediate. It turned the industry on its head by removing gatekeepers, allowing all artists onto the shelves of the digital music services while not requiring them to give up rights and revenue from the sale of their music. It also provided the industry's first transparent royalty system with easy 24/7 real time access. In late 2011, phase two of TuneCore launched with the announcement of its Global Publishing Administration service, allowing any songwriter access to a global publishing administration deal. This first-of-its-kind global pipeline permits all songwriters to access their additional royalties and enforce their copyrights while maintaining control and ownership of their songs.

With our vision, guidance, execution and hard work we made TuneCore the leader in its space as the largest music distribution and publishing entity in the world. From just three people in 2006, TuneCore grew to over 40 employees working out of the headquarters in Brooklyn, NY and the Publishing Administration office in Burbank, CA.

I am announcing today that I am no longer CEO/President of TuneCore and co-founder Peter Wells is no longer working with TuneCore.

Under our tenure, TuneCore took take significant market share away from the traditional major labels. As of July, 2012, TuneCore artists represent over 4% of all US gross digital music sales revenue and have sold over 610,000,000 units of music generating over $310,000,000 in gross music sales. More than four songs a second are sold on iTunes somewhere in the world by a TuneCore artist. Through the execution of the vision and the trust of the artist, TuneCore achieved about 40% of the market share of EMI and 25% of the market share of Universal in regards to digital music sales in the United States.

We were also able to attract artists across the spectrum: from emerging artists to the older legends and the new legends. Artists such as Drake, Soulja Boy, Sonic Youth, Nine Inch Nails, Zac Brown Band, Hoodie Allen, Civil Wars, Lecrea, Boyce Avenue, Kelly, Colt Ford, Ed Sheerhan, Alex Day, Aretha Franklin, Jay Z, Girl Talk, Blood On The Dancefloor, Jason Mraz, Nice Peter, Tiesto and hundreds of thousands more used TuneCore to place number one albums and songs on iTunes, Amazon and many other digital stores, breaking the control of the traditional industry while democratizing it.

Under our leadership, TuneCore changed the global music industry, provided hundreds of thousands of artists access to digital music services, shifted the power of the industry to the artist while administering hundreds of millions of dollars back into their hands under a new model, all while growing the company into a global force.

Peter and I look forward to continuing to change the industry on a global scale to the further betterment of artists, songwriters and investors and to issuing our next announcement.

Questions? Comments? Let us know: @billboardbiz

Print