The driving force behind the digital makeover of Nettwerk is CEO Terry McBride, a man who has helped pay legal fees for people sued by the RIAA for sharing music online. After McBride took such a strong stance for digital music — and away from CD sales — he started speaking more at conferences and talking to the media to spread his vision for a “digital valet” service. He thinks we will all end up paying $5 to $10 per month for access to all music, TV and movies, with a digital valet that knows our tastes and finds media for us.
While most music labels have been squeezed by the shift to digital music, Nettwerk has had growing revenues, McBride told me, and he expects 80% of the company’s 2008 income to be from digital and alternative revenues — and not CD sales. […]
The following is an edited transcript of my phone conversation with McBride, as he explained the revamping of his label, and the push for crowdsourcing music and having bands run their own labels.
When did you realize how important digital music would be vs. physical music and CDs?
You have been pushing many bands to start their own labels. How did that start?
For the marketers of music these days, how has their job changed? It used to be about talking to radio and retailers. Now is it about search engine optimization (SEO)?
You’re doing a lot of crowdsourcing of music, where you put out pieces of music and let people remix them. Is that about engagement and interaction more than business?
If the audience becomes the record label and the artist is gaining more control, where does that leave you? Some people question whether there will be a need for record labels.
What do you think about the ad-based service like what SpiralFrog tried to do?
How did the cases turn out where you were helping legal defenses for fans being sued by the RIAA?
Is the concept of the Long Tail playing out in music, or are these tiny, tiny niches not really viable?
So it’s not about artists being in a geographical niche, but more of a niche that people like all over the world.