Advances in tech, transparency and bridge-building will unlock serious hidden revenues in the years ahead, Kobalt Music Group founder and CEO Willard Ahdritz told delegates on the final day of MIDEM today (full video below).
“I expect that this year our clients will have an uptake from an area where they saw pennies to be substantial money, up to 10% of their publishing income they’ll get from an area where we all thought there was no money,” Ahdritz said during an on-stage interview with Billboard’s editorial director Bill Werde. “That’s very exciting. That’s a part of the future and what we are focused on… Increasing the global cake.”
He added, “In my opinion, I think there is up to 10% of the total publishing income of existing pay-outs stuck in the system and not distributed out to clients,” a figure that includes user-generated sites and Vevo.
In a little more than ten years, the Swedish-born executive has built Kobalt from scratch into one of the most innovative music publishing and services companies in the business, with affiliates and arrangements reaching across the globe. Just yesterday, Kobalt unveiled here a new one-stop European digital licensing service in partnership with Sweden’s STIM. And the week before, the company announced a label services division with the release of Nick Cave’s new album and a worldwide administration deal with Dave Grohl.
“We are 100% convinced that to increase the cake throughout the world,” Ahdritz explained, “and to monetize the new world, you need have to have global databases working together. We need to build structures and bridges between different industries and deliver this. This needs different structures, different costs structures and different ways of doing things.”
And how big can the cake grow? “By 2015, I hope to say we are monetizing 1.5 billion people,” he explained, by means of advances in data, matching and tech.
When Werde posed the line of the skeptics, those who doubt the sustainability of Kobalt’s business model, Ahdritz had this to say, “Our core publishing is profitable and we have no debts. We invest heavily in growth. So we are very smart investors driving our business plan.”