Meet BMG's New Global Dealmaker: Ama Walton On Giving Artists Better Deals, Protecting Copyright and the Echo Awards 'Wake-Up Call'
The industry veteran on what sets the German indie apart in an increasingly diversified music business.
"I skipped the bad part," says Ama Walton about her decision to return to a major music company after more than a decade. The German-born attorney worked for Virgin Records Germany early in her career, then left to work as an independent lawyer and, eventually, help run the music division of German movie company Constantin Film. In May 2017, she started at BMG, which promoted her to global general counsel/chief human resources officer in July.
"It was great when Hartwig [Masuch, BMG CEO] asked me to come back to the music business, because I love to solve problems and the music business is still transforming," says Walton, 47, who this summer moved from Munich to Berlin with her husband, a techno producer, and their two children. In her new role, Walton runs BMG's legal and human resources departments worldwide as part of its management board. "It's a radical shift," she says.
Walton helped negotiate the purchase of the recordings that became the foundation of the new BMG, after Sony bought Bertelsmann's labels in 2008. Since then, the Berlin-based BMG has grown from a small collection of publishing and recording assets purchased from other companies into an important indie label and publisher that also releases books, finances documentaries (including a forthcoming film about David Crosby that will be produced by Cameron Crowe) and controls between 1 and 2 -percent of the recording industry and about 8 percent of publishing worldwide. In the first half of 2018, BMG's -revenue from its recorded-music business rose 38 percent, compared with the same period last year, while its earnings (before interest, taxes, depreciation and amortization) grew by 5 percent to $49 million.
BMG has always promoted itself as a company that deals fairly with artists, and Walton will now decide what its artist and songwriter contracts will look like -- as well as how BMG itself deals with the streaming services that dominate the business. For an indie, BMG has already punched above its weight: In August, it settled a case with Cox Communications that could help define the limits of the legal "safe harbor" that an internet service provider (ISP) has for illegal downloading. And Walton hopes the Music Modernization Act and the European Union Copyright Directive will make the industry more transparent, too.
"The music business is super different now," she says, compared with how Walton knew it in the 1990s. "We're a service-oriented company -- we work for the artist."
What made you decide to come back to the core music business?
I'm very pragmatic: If you can't make money in a business, you look for ways to generate income. So I went to Constantin Film, the biggest film producer and distributor in Germany, which has its own music division. They wanted to build a bigger company, but developing artists is so difficult that they decided to focus on rights licensing. Film people tend to find music people complicated, so they wanted someone who could deal with them.
You worked for BMG when Sony Music bought most of its music assets in 2008.
I'm a classic entertainment lawyer, so I always kept my own clients. And when [Sony bought Bertelsmann's labels], Hartwig hired me to carve out a series of recordings that Bertelsmann would keep the rights to -- albums by Nena, Rick Astley, Kylie Minogue. That became the foundation for the new BMG.
BMG talks a lot about transparency. How does that work in your recording and publishing deals?
The most notable contractual provision is that the share the artist gets is much bigger. On the recording side, that's the main differentiator -- a lot of our recording deals have a 75-25 approach [where an artist gets more royalties, but a smaller, or no, advance]. Other artists want a traditional deal, and we can give that to them, too. But our general approach is the artist service model, which gives more control to the artist. With that, you can come in and check on the budgets and the spending at any time -- there are no restrictions or requirements for a "desktop audit."
A lot of Americans still think of BMG as a publishing-first company that grew through acquisitions. So there's often speculation that you're either shopping for companies or yourself.
We value our roots in publishing, but we're a fully integrated company. If you look into the future, five to 10 years out, our aim is to have a 50-50 split between publishing and recorded-music revenue. We're also focused on organic growth: The price of assets has gone through the roof, and BMG is now big enough that we don't have to focus on acquisitions to be stable.
In 2014, BMG sued Cox for ignoring illegal downloading by its subscribers, which at the time was seen as a bold move. But you won in district court, and in August, the case was settled for what BMG previously called a "substantial settlement." Now the major labels are suing Cox as well. How important was your case?
The other rights holders are suing, but we did the dirty work -- the expensive work. If you look at Cox's internal communication [about its repeat-infringer policy], it's so disrespectful and unconcerned about the property of others -- they just didn't care. Hopefully, this will change the behavior of cable companies.
BMG attracted attention this year for putting out the album by rappers Kollegah and Farid Bang that won an Echo Award and became controversial due to lyrics that were considered anti-Semitic. Do you regret releasing it?
I was sitting in a hotel over Easter break when I saw the story in Bild [the German tabloid] about this. We knew that Kollegah and Farid Bang were controversial, but the line about Auschwitz ["My body is more defined than those of Auschwitz inmates"] was horrible. We had our wake-up call, and we decided to end all contractual relations with them. As a company, we have to be aware of where we stand politically, which is why we started a campaign against anti-Semitism focused on Berlin schools. We started with an event for 12- to 14-year-old students from three schools, and we invited Ben Lesser, a Holocaust survivor who shared his experience. The kids got it.
You now oversee human resources at a time when issues of sexual harassment, sexism and diversity are becoming more important in the music business. How does that play out in Germany?
The U.S. is much further along in terms of including women in management positions. If you look at the DAX [the 30 major companies on the Frankfurt stock exchange], the board members of those companies are 12 percent women. Which is ridiculous, because we know companies are more successful when they have more diverse teams. Music companies didn't seem to become aware of this as quickly as [big German corporations like] Siemens or Allianz. Maybe because we're selling a product that looks very diverse on the artist side, consumers just assume management looks the same way. This is why young people are drawn into the industry, and then when they work there, they think, "Wow, only 60-year-old men are making the decisions."
What has been your experience as an Afro-German woman?
I was the only black student in my class at law school. There weren't always any women around to mentor me, but I got great support from men. And some of this is the same for anyone: You grit your teeth, learn from your failures, wipe off the dust and move on.