Martin Mills and Brian Message Take On Major Labels, Billboard 200 in Launch of Plan to Save Music Retail

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Less than a week after umbrella trade body UK Music launched a five-point policy plan to develop the music business, Britain's Entertainment Retailers Association (ERA) has followed suit with its own manifesto for growth. Supported by Beggars Group founder and chairman Martin Mills and Radiohead manager Brian Message, the pair had strong words to say about global release day, major label dominance and the Billboard 200.

Entitled Shaping The Future of Entertainment, the five key points of the initiative are:

Putting Consumers and Creators First, with specific reference to eradicating "aggressive windowing or lop-sided release schedules," which "can end up exacerbating problems like piracy."

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Modernising the sector's Technology and Working Practices -- most notably building a "modern, efficient supply chain in both the physical and digital ecosystems." ERA also notes that "suppliers need to address a lack of investment in back-office systems, including "high quality and consistent data for digital services."

Simplifying Licensing, which is itself split into five key principles to streamline the licensing process. They are: a) Minimizing the number of different licensing points. b) Greater flexibility from suppliers in their approach to licensing, including "test-bed licensing as a way to trial new ideas." c) Prioritize the creation of a central information resource built around high quality repertoire data. d) Quicker decision making. e) Fast-track dispute resolution.

Promoting Diversity in Retailing and Digital Services -- "Suppliers need to re-examine licensing terms which currently mean most digital services can only succeed at scale," recommends ERA.

Addressing Retail Sustainability -- specifically arresting the decreasing margins of entertainment retailers "at the same as suppliers have been able to escape the costs of physical manufacturing."

Speaking at the manifesto launch, which took place this morning (Feb. 24) in central London, Mills called retail "the interface between artist and fan through their recorded music, and every time I see attempts to cut out the retailer fail, I am surer and surer of that."

"Rather than dis-intermediation, the internet brought disaggregation, the single biggest change in this era," continued Mills in a wide-ranging speech in which he identified "two tribes of consumers, and two tribes of artist -- those that want their music in album form, and those that want it in track form."

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"The singles and albums charts now represent, other than for superstar artists, two different worlds," he added calling "this two-sided world… good for music, good for the consumer. It creates a diverse musical climate, because not all artists are running the same race."

"But I am really concerned that there are forces at work that wish to destroy this, to create a lowest common denominator musical landscape," stated Mills citing the inclusion of track sales and streams alongside album sales in the Billboard 200 chart as one example of aggregation that, he claimed, makes "the big artists look and get bigger, and the more niche artists of the album world get swamped, and side-lined, starved of exposure."

Mills continued: "It may well be in the interests of the small number of super-consolidated major labels to make the big become bigger, and appear to be even bigger. But I believe it's fundamentally against the interests of the rest of us, since it will reduce the oxygen available for exposure for artists whose natural format is the album."

"That will hurt all labels and artists long term, I believe, as lack of diversity will strangle innovation and music will become moribund and uninteresting, and consumer interest will erode. It will also dis-empower the artist since the major labels will regain total control of access to market. It will create short termism, and damage career longevity."

Mills attack on major labels did not stop there, though. Detailing his "concerns about the proposed global release day," the Beggars chief said that he feared that the majors' consultation about a worldwide music release date "has been a charade."

"I fear this move will also lead to a market in which the mainstream dominates, and the niche, which can be tomorrow's mainstream, is further marginalized. I fear it will further cement the dominance of the few -- and that is exactly what it is intended to do."

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He wasn't done there either. Discussing the digital retail landscape, Mills called upon major suppliers to "encourage the growth of local, niche, or specialist digital services."

"That may mean, for them, less onerous up front terms. [But] disproportionate advances, guarantees, and breakage, have distorted our industry, reduced transparency, created suspicion, limited funds available for marketing and promotion, and hobbled new services. I believe the market would be healthier for everyone without them."

Also present at the manifesto launch was Message, whose clients include Radiohead and who also stands on the board of directors of the Music Managers Forum (MMF). Like Mills he also had strong words about the failings of major labels to protect and develop a sustainable future for the music business.

"Central to this structural failure is the NDA [non-disclosure agreements] culture that is now ingrained in the licensing of creator catalogues to retailers and digital services," said Message, adding that "having now met with whistle-blowers, law makers, artists, managers, label personnel, digital service providers, lawyers and litigators on all sides… I'm reasonably sure that whilst it takes two parties to sign an NDA, it's the corporates owning the major labels that today drive this particular agenda."

Message continued: "When the price of getting a license is a stake in the digital service provider and that stake is attained at less than market rates or at the expense of per play revenue then that is value lost to the economic chain."

"Overhead contributions, technology fees, advances that can't be recouped, unattributable advances, equity positions at the expense of streaming rates, the dropping of litigation to receive shares that then get sold and other such clever tactics distort the market and ultimately don't allow it's development for the benefit of everyone," he went on to say, singling out "BMG, Kobalt and leading independents" as examples of companies "who are leading the charge as to how a 21st century rights holder should operate."