The Future of Cloud Music Debated by Publishers, Rights Holders, Digital Services @MIDEM
The Future of Cloud Music Debated by Publishers, Rights Holders, Digital Services @MIDEM
From left: CISAC director general Olivier Hinnewinkel, who introduced the panel; moderator Emmanuel Legrand, a journalist and consultant; Scott Bagby, head of strategic partnerships at Rdio; Richard Conlon, BMI senior VP of corporate strategy, communications and new media; SACEM VP Thierry Desurmont; Merlin head of business affairs/general counsel Charlie Lexton; Ben McEwen, director of online licensing at PRS for Music; Mitch Rubin, head of music publishing business affairs at Nokia; and Jens-Markus Wegener, managing director at AMV Talpa GmbH (Photo: Louis Hau)

CANNES -- Over the past year, cloud-based music lockers have begun entering the mainstream, embraced by major players like Apple, Amazon and Google. But as was obvious Tuesday during a MIDEM panel discussion on the topic, there are still many questions about what cloud services should be and where they're headed.

As noted by PRS for Music director of online licensing Ben McEwen, the term "cloud" is applied to such a wide range of services that it's important to be specific when discussing business models. The bulk of Tuesday's discussion focused on cloud storage services, including those to which consumers upload songs and those that offer scan-and-match capabilities.

Richard Conlon, BMI's senior VP of corporate strategy, communications and new media dismissed arguments that accessing music stored in a cloud locker is not a commercial activity -- that is, one that shouldn't trigger payments back to rights holders.

"That's a bunch of baloney," Conlon said. "It IS a commercial activity."

When AMV Talpa managing director Jens-Markus Wegener expressed wariness over the fact that cloud lockers don't distinguish between purchased downloads and illegally acquired content, Rdio head of strategic partnerships Scott Bagby responded that "the majority of consumers want to pay artists, they want to do the right thing." But Bagby added that it is vital for rights holders to provide music at a cost that can accommodate pricing that will appeal to consumers.

Mitch Rubin, head of music publishing business affairs at Nokia, encouraged music companies to be more flexible in their licensing terms. "The more innovation, the better for everyone," he said. Conlon said right holders aren't looking to force rates in the marketplace that aren't economically viable. "It's not about rights enforcement," he said, "but about making markets and putting a layer of economy over these activities."

As for what type of cloud service is likely to prevail, McEwen said scan-and-match services are clearly more convenient for consumers than those that require them to upload tracks. But he predicted that even scan-and-match will merely be "a stepping stone between downloading and an access model."

The access model is what online subscription services began offering long before "cloud" became a fashionable term to throw around. As more consumers access services like Spotify, Rdio and Rhapsody on their smartphones, the oldest type of cloud service may ultimately prove to be one that prevails.

Charlie Lexton, head of business affairs/general counsel for indie global rights body Merlin, said ease of use will win the day. "As a consumer, in my personal view, the models like Rdio are far more preferable because I don't have to do anything," he said.