A History of Lyor Cohen's Tech Moves
Following the executive's jump to YouTube, a retrospective on his work with Silicon Valley.
Lyor Cohen has built his career out of making bold moves. This week Cohen's taken that tendency towards diving into the unknown by leaving his latest company, 300 Entertainment, to take a role as the global head of music for YouTube, with the aim of bringing the tech and music industries closer together to build a mutually beneficial future.
It's an admirable goal, and one that Cohen seems suited for; after all, he's both respected and feared by many of his peers in the music industry, and the tech and digital world has become of particular interest to him of late -- in the 14 months between Cohen leaving Warner Music Group and launching 300, he embedded himself within several digital music companies to get a better feel for the ins and outs of the tech world order.
With plenty of experience under his belt as an artist advocate and a sharp business acumen, Cohen has made a few powerful decisions when it has come to the intersection of tech and music. Here are a few of his other digital moves of the past few years.
Warner Music Channel on YouTube
While YouTube was still a nascent company building up cache on user-generated videos, it attracted the ire of the music and film industries that objected to its free hosting of copyrighted material. But where some saw infringement, Warner Music Group saw an opportunity, and WMG became the first major label to strike an advertising revenue-sharing deal with the service utilizing an early version of YouTube's Content ID system to identify and monetize infringing tracks under the Warner umbrella. They also had launched a YouTube channel, one of the very first the web video service had created, with an advertising partner to promote a Paris Hilton album earlier that year.
Six year later, after a few high-profile dustups between the two -- including in December 2008, when Cohen pulled Warner's catalog from YouTube in a battle over fair compensation -- WMG again found success on YouTube's platform with its Warner Sound channel, which allowed its artists the chance to experiment with video content around the songs and singles they release, including interviews and lyric videos and behind-the-scenes footage of its artists.
Warner Invests in LaLa.Com
Wary of Apple's digital music near-monopoly and looking to bolster its lagging sales, Warner Music Group invested in LaLa.com, a CD trading site that was transitioning into becoming one of the first on-demand streaming services in the U.S., to the tune of $20 million. Fans were able to stream Warner's catalog on the site for free, with LaLa kicking back royalties to the label and guiding fans towards purchasing albums in the hopes of building out a sustainable business model. Cohen praised LaLa in 2009 for its "clear path to revenue." Two years later the company cashed out and received just $9 million back; in January 2010, Apple, perhaps seeing Spotify over its shoulder, purchased LaLa.
Apple Introduces Flexible Pricing
After Cohen battled for years with Steve Jobs and Apple about the iTunes Store's fixed price of $0.99 per song -- which he once decried by telling Billboard, "It’s very hard to explain to Jimmy Page why 'Stairway to Heaven' is 99 cents and Chumbawamba is the same price" -- Apple officially introduced flexible pricing for songs, allowing labels to set price points at $0.69, $0.99 and $1.29.
Warner Spurns Vevo for MTV
Vevo looked to be the majors' own answer to YouTube when it launched in 2009 with Universal and Sony -- as well as Google -- among others, chipping in as equity partners in the web video service. But Warner was the lone holdout, instead signing a deal with MTV Networks to sell ads against its music videos. The move worked, at least initially, as MTV overtook Vevo in September of that year as the most-visited online music hub, but Universal's clout as the biggest record label in the world eventually submarined the experiment as it pulled its artists' music from MTV's platform and forced the network to the table. Warner finally struck a deal with Vevo last month, long after Cohen departed.
Warner Music Group Embraces Spotify
After years of negotiations with the Swedish streaming giant, Cohen signed off on a licensing deal with Spotify for Warner Music Group's catalog, becoming the final major label to join forces with what would become the world's largest streaming service. As with YouTube before, WMG's embrace of streaming paid off; this year, it became the first major label to announce that streaming was the highest source of revenue from any avenue for its recorded music business in the first quarter of 2016.
300 Launches with Investment from Google
Just before Cohen was set to launch 300 Entertainment, sources confirmed that Google had led a round of investment from a wide range of interested parties that totaled some $5 million, right at the time when the company was said to be close to launching a music subscription service. (That service, Music Key, was short-lived, and re-launched as YouTube Red last year.) "With YouTube, we have a long history of supporting artists and content creators," a Google spokesperson told Billboard at the time. "So we're excited to invest in 300, a new, innovative company designed to create opportunities for artists."
300 Partners with Twitter
Feb. 2, 2014
During a keynote speech at Midem in Cannes, France, Cohen announced that 300 had partnered with Twitter in an effort to search for and identify bubbling artists and develop their careers. In a conversation explaining the theory behind the partnership, Twitter's head of music at the time, Bob Moczydlowsky, explained, "Twitter is like a fire hose of data. There’s a ton of new information and conversations about music that we have never let of out of the building before... This can valuable data for things like targeted marketing and A&R. It has the potential to help the industry figure out how to best invest in artists or how to direct their marketing campaigns."
At Midem, Cohen explained the partnership with a bit of foreshadowing thrown in. "If you want to get signed, you have to engage with Twitter, and of course YouTube, and we’ll be looking to try and develop tools that the rest of the music community can utilize," he said, later telling Billboard, "The partnership is to create tools for the creative community that allows more artists to be discovered and more successful."
Cohen Jumps to YouTube
His new role at YouTube will continue his long-running dedication to being an advocate for fair compensation for artists, albeit this time on the other side of the table. It's fair to say that Cohen sees both sides of the argument here: that labels, and therefore artists, need higher royalty payments in order for them to continue to make a living in the music business; and that YouTube and streaming in general is both the present and the future of distribution in the music industry, and the labels and artists need to understand that. Whether he'll be successful in brokering a cease-fire of sorts between the two sides remains to be seen, but Cohen seems well-placed to be the one to lead the charge.