Industry Chat: Terry McBride of Nettwerk - Is Ownership of Music Simply Irrelevant?

Terry McBride, CEO of Nettwerk (a combo music management company and record label) is known throughout the music industry as a progressive thinker - one forcibly moving the industry into a potentially sustainable future.  Nettwerk manages the careers of numerous artists including Sarah McLachlan, Jars of Clay, Barenaked Ladies as well as serving as the record label for up and coming artists like Great Lake Swimmers, Rosie Thomas, Datarock and State Radio.  McBride's thoughts on things like music ownership aren't what you'd expect from someone in his position.  You'll see his stunning comments on that - and a number of other topics, in our exclusive Q&A below.

Q:  You've been hard at work, as have many others, at "reinventing" the very broken music business for some time now.  What have you tried that holds particular promise?  Any helpful failures?

The key in all that we have tried is the need to align all interests within an Artist's business. Each part (Fans, Label, Publishing, Songwriting, Live, Sponsorships, Merchandise, Marketing, Promotion) are all interdependent of each other. So to have the best chance of success they need to be treated as one. Failures? Laughter, lots of lessons along the way though.

Q:  What's the idea with Polyphonic - your new partnership that includes Radiohead's management?  Is it basically just VC for individual artists?  Is there a core belief driving this new concept?

Polyphonic is really a simple model. Create a Joint Venture with the Artist, align all parts of the business as stated above, put a monetary fund within the business that allows the Artist Manager to hire all the "best in practice" services that best fit that Artist. This model I believe gives the Artist the best chance of having a vibrant and authentic career.

Q:  Let's talk about intellectual property.  How do the artists you're working with view their rights versus consumer realities?  Is it different for "major" versus "developing" artists?  Should artists yield to giving away a lot of music to generate a fanbase?

There is no same answer to these questions from Nettwerk's roster. What I can say is that the Artist's desire is to create what they love and they need a monetary way to live while doing such. My own personal view is "the fans own the songs." A Song becomes popular when enough fans attach their own individual emotions to what the Artist has created. My role is to figure out a way to monetize that emotional connection in an authentic and compelling manner that adds value to the Fan and the Artist. Giving away music as you suggested is one manner.

Q:  Nettwerk has tried to move beyond just selling records.  With Barenaked Ladies, you took a set of IP and repackaged it numerous ways to create a diverse, non-CD dependent revenue model.  Did it work as a sustainable concept beyond the initial success?  Will you be trying further iterations?

With BNL they are in a place now where they make more revenue from their 3 independent albums than what they make from their 8 Warner albums. Where they decide to go from here is their choice, but what's great is that they have a choice.

Q:  Do you believe direct artist subscription models, either single artist like Jack White has done with The Dead Weather or aggregators like Brite Revolution herald some kind of significant evolution for how artists will make their livings?

I don't think it's that simple. It's about delivering value and being authentic. I think models like Pandora and Spotify will get a lot of traction as they deliver on those levels. I do believe that we are seeing a profound shift from "content is king" to "context as king." With the mobile app revolution in full swing the need to own goes away, the need to access goes way up.

Q:  If you could get all of America's music consumers in one room, what would you want to tell them?  Besides that they should take up yoga, that is.  ;-)

Find a way to support those artists you love so that they can continue to create. I think Yoga is good for everyone, I know it makes me a much happier and I am way more fit.... if not Yoga then consider something that requires exercise and takes your mind away from all the trial and tribulations of day to day life.