Trillbilly Worker's Party - Episode 246: Under Hipgnosis (w/ special guest Rich Woodall)

Episode Date: April 28, 2022

This week we're talking about the music industry, and about how there's a scramble for profitable IP among the record labels and various so-called "song funds." Old songs are all the rage now, and as investments they're even more profitable than oil or gold, apparently. We're joined by writer Rich Woodall to help steer us through the complicated, treacherous world of song rights, streaming platforms, and contracts. You can read Rich's writing at the Baffler here: https://thebaffler.com/outbursts/the-masters-own-you-woodall and here: https://thebaffler.com/latest/mass-hipgnosis-woodall And you can support us on Patreon at: www.patreon.com/trillbilllyworkersparty

I listen to the podcast, of course. Yeah, you listen to it, so it's not completely offensive to the British worldview. I'll confess I was not already familiar with your work, but I've listened to a few episodes since you contacted me, and yeah, I can confirm, not offensive to the British worldview. Good to know. Good to know we passed the muster of the Anglo world. Well, welcome to the Trailbillies, everybody.

I am one of your co-hosts, Terrence, joined by Mr. Tom Sexton, of course. Yo, yo. Today, we're going to be talking about the music industry. On this show, we've joked a lot about how easy it is to kind of latch on to a specific data point or like a story or an anecdote that can that kind of like speaks to the specific kind of hell that we live in you know and for me personally one that i keep coming back to and obviously the audience and tom will have heard me say this about a million times but it's it's this story about how all of these major artists of yesteryear like bob dylan and bruce springsteen stevie nicks paul simon you

you name them all your favorite motley crew all your favorite hit makers um they are now selling portions or all of their song catalogs to either a major label or a quote-unquote song fund about which we will you know we'll discuss more in just a second um you know this is i guess maybe the reason why it's so dark and dystopic for me is because i'm a musician um i don't make a living playing music, obviously, but I do have a lot of friends that do. And I've just noticed that it's becoming increasingly very difficult to make a living from this industry. Not only just because of the hit everyone took in 2020 with the pandemic, but also just because of what we're going to be discussing today. So to help us do that and to help us get like a more comprehensive portrait of, you know,

the political economy of the music industry, we've enlisted the help of writer Rich Woodall, who wrote two really good, in my opinion, two really good and incisive pieces for the Baffler. who wrote two really good, in my opinion, two really good and incisive pieces for The Baffler. You know, repping The Baffler, both Tom and I have written for them as well, about the state of the industry. Rich is calling in from the bright and sunny island of England,

as I understand it. Rich, how's it going over on your side of the pond? Yeah, it's bright and sunny, like you said. Good. Yeah, can't complain. Good, good. Well, what we're going to be discussing today isn't so bright and sunny, I feel like. Unlike Mother England, not so bright and sunny.

So, yeah, so, like, let's just start out with some of the basics. You've written a lot about this quote-unquote song fund called, and I love the name, and when I first saw the name, I got really confused. The name is Hypnosis. It's spelled weird. H-I-P-G-N-O-S-I-S. It's like Gnosis, like Gnostic almost, you know. It's got the same spelling as the infamous British Design Collective from like the 70s and 80s that did all of the great like Led Zeppelin and Pink Floyd album covers.

And when I first started reading your articles, I was like, wait, what the fuck? I was like, did they become like an asset management firm? Like what happened here? But no, there's no relation, apparently, as far as I understand it. Well, they I mean, there is there's no commercial relation, but supposedly Mercurialis, who's the head of hypnosis, knows the, I think it's called Storm Ferguson, the guy who's behind the LP cover designers, you know, their buddies.

And Storm gave his blessing for Merc to use the name in in his uh in his new venture so wow uh there is there is a sort of another depressing wrinkle to yeah right like we we all sell out in our own specific ways can't can't can't can't ride off those pink floyd dark side of the Moon residuals forever, I guess, can you? I guess not anymore, since people aren't buying hard copies of albums anymore. In some ways, it's kind of metaphorical, right? It's like the transmutation from Hypnosis, the album cover designer, to Hypnosis, as we will discover, the IP acquirer of you know songs is that asset fund class anyways you've written a lot about hypnosis which is just like hoovering up a lot of these rights to songs left and right um who are they and why are they doing this? Why are they buying song rights? So they were founded in 2018 by the aforementioned Merc, Mukuri Idis, who's a former executive at Sanctuary Records label

and was also a manager. He managed Guns N' Roses, Beyonce, I think, and others. Really? That's fascinating. I didn't know that. Not a bad clientele list. Yeah, well, that's very much sort of part of the kind of unique cachet that he brings to the role because Hypnosis are not the only song fund and they're not the first either. I mean, a song fund is a company that raises investment

capital and issues shares and they say to their shareholders, we're going to take your money and we're going to buy the rights to popular songs and use the royalty streams from those songs as the basis of this investment vehicle. And because the royalties from those songs as the basis of this investment vehicle and and because the because the royalties from these songs will remain stable and in fact grow over time it'll it'll grow the the value of your shares and and provide a nice dividend as well so that that's that's sort of the business model like like hypnosis kind of stand out because partly because of merc because he's this sort of he's this kind of like buff chrome domed dude with this like background in the music industry and he has this sort of he has this sort of pitch to musicians which is that like he's the guy

who you can sell your songs to and and he'll he understands you know he understands musicians he understands art he's not gonna like i don't take like neil young and like license him you know to like a arms fair or or like raytheon yeah right so yeah that's that's the sort of the kind of unique pitch that they offer to people. They're the people who kind of really understand music and understand artists. And that's going to shape how they use the music that they acquire. I watched an interview with him. You know, it really breaks my heart because hypnosis yeah was started by this guy mark

mercuriatus i guess that's how you say his name i'm not entirely sure but like it's also co-founded by nile rogers who big fan of chic you know big fan of nile and his work maybe the best guitar player ever at least in that conversation yeah yeah. Who wrote Diana Ross's I'm Coming Out because he was taking a piss at a drag show and noticed that the two drag queens on both sides of him were dressed as Diana Ross. And so he was like, all right. I love Matt Rogers. But I guess my man saw an

opportunity and couldn't say no because ultimately that's what this is hypnosis is an exciting opportunity to profit off of yeah the songs of yesteryear not only the songs but like the feelings they evoke is that is is the is the rationale for this sort of thing basically like okay we can um give all these sort of aging artists like this big lump sum up up front but with the rise of streaming we could just sort of eat in perpetuity off of the catalogs or whatever percentage of the catalogs that they own. I'm not sure like, you know how that breaks down, but like I've made the joke earlier about Motley Crue,

but I saw that they had also sold their catalog for like a shockingly high number. In my mind, it was like 150 million or something like that. Something like that. That's like, can you really eat off who you you gonna call dr feel good like they had some good balance i guess i shouldn't shit on them too hard but

but you know what i'm saying it's like it's like 150 million for kind of uh as i as i've stated before a lot of cocaine and heroin went into those albums, Tom. That's a lot of overhead. You know what I mean? That's true. You got to recoup it on the back end 30 years later. Yeah, I think Motley Crue had to pay out of their royalties for a lot of the drugs that were consumed during their heyday. Yeah, I mean, you're exactly right. So most of the musicians who are selling up,

the kind of high-profile ones, are coming towards the end of their careers. They might have even stopped recording new material or, you know, realistically not have that many more albums in them and are kind of increasingly perhaps averse to the idea of touring although i mean i don't know bob dylan doesn't seem to nothing seems to to to stop him but right basically approaching retirement and it's it's the prospect of this massive payday and it's also kind of smart estate planning

because it's much easier to figure out what you're going to do with a lump sum of cash in terms of passing it on to your heirs or putting it in trusts or hiding it from the taxman. It's much easier to do that than it is to do with these royalty streams, which are kind of snarled up in this incredibly complicated music industry.

The fees that are getting paid, they're based on sort of multiples of what the annual value of the record collection is. And Hypnosis have really sort of pushed the envelope in terms of playing these really big multiples like we're talking like 16 18 times what their what the catalog makes in in in a year as a lump sum and a lot of them seem insane to me like the idea that um the idea that like the value of barry manilow's catalog is gonna is gonna is gonna grow because that's that's it that's the the supposition is that this

shit's gonna be more valuable in the future but right that seems deranged to me yeah in this interview that i think you linked to in one of your pieces, Merck compares it like as an asset class. He actually compares it to gold or oil. He says, effectively what I did, and this was my mission, was to demonstrate that these predictable and reliable songs were as investable as gold or oil. And as you say, with this desire for uncorrelated assets, even better because they're predictable and reliable. If Donald Trump were to wake up tomorrow morning and do something that was metaphorically the same as pushing the red button, this was back in 2018 when everybody thought Trump was going

to nuke the world. If times are good, people are celebrating with music. If times are challenging, people are escaping with music. If times are challenging, people are escaping with music. So music is one of those few things that, regardless of what's going on in the world, is constantly being consumed. And as you and others have pointed out, with the creation of these streaming services and everything, now they have a perfect medium through which to stream these songs and gather the royalties from them in perpetuity and then obviously fulfill the obligations to their shareholders of a group like Hypnosis. You know, it's weird.

One of the things that I thought was really fascinating was like Merck, like the way he describes sort of why this is happening. Like that was a very interesting interview that you linked with it was um investment trust insider citywire.com this is like he basically just sort of like blatantly explains why he's interested in this as like an investment sort of like asset class but i mean like his description of why i thought was pretty interesting he says in the early 80s 90 of the artists you would sign were artists that wrote their own songs, performed their own songs, had a very good idea of who they were,

who they might become, what their album cover should look like. Maybe they would want to hire Hypnosis to do that. What their stage show should look like. So my job was to, number one, believe in them and make other people believe. And then, number two, put a strategy in place to bring those ideas to fruition. He's talking about when he got started in the 80s when this was the case. Today, 90% of the artists that are being signed are really talented people. But ultimately, the end game is fame.

And whether that fame comes from singing someone else's song or singing a co-written song or whether it comes from social media or whether it comes from TV talent competitions like The X Factor. If you're Zara Larson and you have access to hit songs, you're top of the charts. If you're Iggy Azalea and five years ago you had the biggest song in the world with a song called Fancy,

but for whatever reason you no longer have access to hit songs, you're nowhere. So basically he's saying- Playboy Cardi. Getting her pregnant and leaving her. right like was that shade he was throwing for whatever reason you no longer have yeah for whatever yeah um says but like it's interesting thing basically he's saying that like music now has kind of been taken i mean there's a lot of reasons for why this is happening uh but one of them i think is like that muse the music industry has kind of been taken over by that same sort of

parasocial influencer um impulse that has obviously taken over all the other entertainment industries and so like now artists just go on singing competitions and sing the songs that were popular 20, 30 years ago. And everyone gets paid off of that. And this process, what it does is it actually disincentivizes the production of new music, new original music. Could you talk a little bit about that rich like about how about how like this this overall process makes it more difficult and unlikely for new music to be uh invested in created marketed uh etc yeah absolutely i mean i think the unspoken subtext in that sort of quote from from murck is that the modern music economy

is set up in a way that really disempowers artists, even relative to previously. I mean, it's always been bad, but the way that the kind of streaming economy works makes it really difficult for performing artists and songwriters to support themselves from the music that they songs that they create spotify for instance or kind of streaming platforms in general have helped kind of create this system that's sort of skewed towards the monetization of

of catalog which is the sort of industry term for songs that are you know more than i think 18 months or two years old you know like like like you were saying it's created this environment where you know rather than having to reissue this stuff like make like greatest hits collections it's sort of permanently there on the shelf like ready for people to listen to and i think today like my catalog music accounts for something like 75 of sales and streams which is vastly vastly more than than even sort of like 10 kind of like 15 years ago and that suits the kind of big rights holders like sort of record companies because they own the rights to most of this old music they acquired most of it you know decades ago on through contracts which pay an extremely low royalty rate to the musicians who created it so they really get to keep the

lion's share of the profits so that that created like a very sort of like powerful incentive for for these companies to promote and monetize old content and hypnosis and the other song funds are kind of they're the sort of like latest like kind of logical consequence of that process really yeah because there's other song funds than just hypnosis right and like hyp itself, like some of its investors, is like Morgan Stanley like one of their investors or JP Morgan? I don't know. I know there's some like large banks that are invested in them.

They've been increasingly attracting Wall Street money. The really big deal that they've made sort made towards the end of last year was a billion dollar partnership with Blackstone. Oh, boy. Wow. They're the big corporate landlords who buy cheap housing and drive with the rents and evict people and stuff like that. Yeah, it's fascinating. In a way, this is kind of a similar process. They're setting themselves up as rentiers, right? In the same way they can create this market to funnel money upwards, profits upwards, or surplus upwards from real estate, they can also do that with intellectual rights, in this case, songs. Absolutely, yeah. It's effectively rent-seeking behavior.

You know, one thing digital music, the sort of rise that digital music has done is for major labels, particularly. You know, I'm talking about the really big ones. It's really reduced their margins, you know, because they don't have to pay for a manufacturer. They don't have to pay for distribution. They don't have to pay for a manufacturer. They don't have to pay for distribution. They don't have to pay for local A&R. And it's also kind of, in a way, sort of necessitated touring for the artist as like the primary way they make their money too, right?

Because like it used to be the case that you would tour to sell records, right? And merch and whatever. And I think the merch is still in play. But now you make the music so that you have something to tour off of rather than the other way around. Yeah.

Absolutely, yeah. And that's why COVID has been such a disaster for musicians because it's destroyed their main source of income. And it's really interesting. The price of streaming subscriptions has stayed flat since Spikefire arrived. It's still like $9.99 a month or whatever.

But if you compare, which obviously is an incredible deal for all the music, but if you compare which you know obviously is an incredible deal for like you know all the music but if you compare that to the what's happened to ticket prices for live gigs you know you can see what what effect that has had you know sort of as a knock-on on the these other aspects of the music economy yeah and then now like you got outfits like live nation like buying up even the smallest venues and sort of mid-sized cities all over the world and really dominating that sphere of it too. Yeah, absolutely. It's fascinating.

I think like it seems to me that obviously this isn't just relegated to the music industry, this sort of financialization of the creation of you know mass media and culture because like obviously what's going on here what we're describing is the squeezing of ip from the last 50 years for you know as much profits and surplus as they can get out of it which is honestly what's going on in the movie industry and in TV as well, right? Like with the superhero movies, but also just with all the reboots and all the other things. And I don't think it's necessarily because people are out of ideas or people are afraid to take creative risks. I think it just shows that it's just a safe, a quote unquote safe investment in general. So it's not like so-unquote safe investment in general. So it's not so much an aversion to creative risk.

It's kind of more an aversion to financial risk in a way. Right, yeah. Like if you have a known franchise, you don't have to spend as much money advertising. You kind of cut your overhead. It's just like a known and loved deal. That's why, particularly in horror, you see all the Halloween halloween reboots

and the yeah i think it's something to do the platform the sort of platformization of culture as well because i mean it's this is it's a bit different with with movies because in music the thing about music streaming is that every every platform has basically the same content but with with kind of movies and stuff when people when people are making their decisions about, am I going to subscribe to Disney Plus or Amazon Prime, they're not going to be like, what's this groundbreaking new show that I've never heard of? I'll sign up for the platform. They're like, what recognizable IP have they got

that's going to bring me onto this? Jay-Z tried to do that with title like they tried to do a kind of like more curated sort of uh proprietary streaming platform with title in the same way that they were doing this with like hulu and stuff and it didn't really uh work i guess i don't know i don't know how title's doing as i think he sold off his shares fairly quick into the venture. Right. I see.

But this kind of, I mean, so, all right. So we have this set of circumstances. We have like what we are staring at now. In your piece, you kind of go back through the history of maybe the last 30 years of the music industry. And I've actually go back even further than that, because, you know, you talk about the difference in between like publishing rights and master rights. I wanted to talk a little bit about the music industry as it stood on the eve of the sort of file sharing digital revolution

in the late 90s, early 2000s. Because it seems to me like that, in that moment, might be some of the clues to how we got to where we are today. So, yeah, so I don't know, Rich, I don't know if you want to talk about, you know, rights, like, the intellectual copyright aspect of this, or if you want to talk about, like, the big three record companies, but just generally, I kind of just want to talk about the situation that they found themselves in, in the 90s, with just reaping in money hand over fist, with the apotheosis of the commercialization of music with the compact disc, right?

So maybe we could just talk a little bit about, yeah, like the big three. Like who are the big three music labels? And why were they unable to really unify around a way to ride the digital wave that Napster and some of these other platforms proposed? So the big three music labels are Warner, Sony and Universal Music. Sony and Universal Music, they control around about two thirds of the kind of global music industry. Although I should say that like when you hear any figures about the music industry, like they're always contested.

Like people are always arguing about them because, you know, they tend to be based on on on sort of information that's kind of not always in the public eye and depending on sort of which side of the argument you find yourself on you know people have have different figures and i mean the the major labels are funny because you know when they're talking to their to potentially investors they'd like to they'd like to boost their what their market share is but when they're when they're sort of talking to i don't know kind of like regulators about their relationship with the streaming platforms they like to sort of play down what

their their market share is right but they they control the they control the the majority of the market and and so most importantly for this discussion i think they control the majority of the market and and so most importantly for this discussion i think they control the majority of the music catalogs i think yeah i think we probably probably have to like at least sort of sketch this distinction between master rights and publishing rights and music it's it's just disgustingly complicated and so i'll be sort of oversimplifying and i'll probably i'll probably get some things wrong as well because I don't think there's anyone who understands this shit really. It's incredibly Byzantine, yes. Yeah.

So say we're talking about streaming, right? You're on Spotify and you play a song. There are two sort of baskets of rights that are associated with that stream. There's master rights, which apply to like a specific recording of a song. And there's publishing rights, which sort of apply to the kind of like the idea of the song, I guess. You know, the lyrics and the chords or the kind of notation or what have you. A lot of the time these belong to different parties, so it might be in some cases like the recording artist is also the writer of the song in which case they sort of theoretically

control both the master rights and the publishing rights know in cases where the singer isn't the person who wrote the song then the songwriter gets the publishing rights and the artist gets the master rights. Talking about the major labels, the major labels are the sort of number one owners of Asterites and the way that they acquired those is through record contracts. So obviously contracts are arrangements between, you know, sort of private arrangements between parties so they vary a lot but there's a kind of like general template for how major label record contracts have worked historically and that's that the recording eyes hands over their rights to the label in return for an advance so the label gets to collect the royalties on the on the record and and they get the right to sort of say who who gets to reproduce and distribute

that that music and then the they give the they give the musician like a percentage of the royalties which the musician has to use to pay back their advance before they start to see any right i've heard some horror stories about this like terence and i have a friend that was signed to sub pop records and he was telling us that like in the process of the process of working out their deal and cutting their first record for Sub Pop and everything, that when the bill came due and payable, so to speak, all the little times they had wined them and dined them to sign them, they had put all those meals on their advance and everything they're like what the hell is this and it got so bad that they had to make friends with the guy at the sub pop warehouse to go and get some like stock of their records to take out on tour to sell because sub pop would not let them like have any records or anything well it's like it's like the prince quote that you put in your article like Unless you own the masters, the masters own you, basically. Yeah, well, what's happened over time is that as the record industry

has consolidated, because in the 90s and earlier, there were more major labels but the industry's gone through this process of consolidation where we've ended up with the big three and through that consolidation they've come to own all of these master rights which are sort of which are sort of signed over to various different record labels through these contracts down the years. And that these sort of vast collections of IP gives them tremendous leverage. It is the source of their power in the industry these days, really. Yeah, and as you point out in the article, in the 90s, they used to be able to control basically every aspect of the production creation and distribution

of the music like the physical distribution of it like um for example cds cd manufacturer like you could you could have a very cheap physical product cost like two dollars to make and then mark it up and sell it for like fifteen dollars and like the profits that they reaped were just astronomical um but like streaming kind of presented them with a new a new problem right like you know and everybody talks about ted talked about it i remember people talking about it a lot back then um but it definitely seems now in the last few years like i think there was a law that was signed by trump in 2018 i think it's called like the mma or something like it definitely feels like the record companies the big three in coordination with spotify and these other streaming platforms, have definitely figured out a way to, once again, regain a foothold, reap in maximum profits.

But this time, they have disempowered the performer or the songwriters even more than they were before. And as you point out in your article it's actually i didn't even know this but like in some of these deals like the deal that sony worked out with spotify like sony gets like a certain like they have a certain stake in spotify itself so it's like they're almost like rigging the industry to you know it's it's in a say in a similar fashion of them like being able to control every aspect of distribution in the 90s with the cd they've sort of been able to recreate that but now they've they have a certain stake in spotify

itself and they can work out this sort of minute details because spotify never turns a profit they're basically at the mercy of these big three minute details because Spotify never turns a profit. They're basically at the mercy of these big three, right? Like they've never posted a profit. Isn't that correct? Annually, no, no. They've been sort of certain quarters where they have, but annually, no. They're actually, I think some analysts projecting that 2022 will be the year where Spotify finally does turn a profit. will be the year where Spotify finally does turn a profit. But their business model has been basically like Uber, really,

or any kind of gig economy, like tech company, which is to come into a market backed by a shitload of venture capital because they can afford to operate at a loss. They can offer whatever service or product they're selling below cost and use that to capture market share. They keep getting more and more investment on the promise of future growth. That's always been the MO from Spotify. Investors keep putting money into them because they promise that they'll keep growing.

And I mean, that's why they can never offer a good deal for musicians unless one makes them, because any more money that they give out to musicians is going to eat into their growth. Well, to the extent that... Okay, so as we pointed out earlier, this situation, this kind of financialization of the intellectual property of songs has created this situation where new music isn't really being made.

I mean, it is, obviously. I mean, I still listen to quite a bit of new music isn't really being made. I mean, it is, obviously. I mean, I still listen to quite a bit of new music. But it definitely seems, in the aggregate, I think a lot of these streaming platforms and the rights holders, whether it's Hypnosis or Sony, have been able to figure out that the vast majority of streams, not the vast majority, but maybe like 60, I think the last time I checked, it was like 60% of streams, not the vast majority, but maybe like 60, I think the last time

I checked is like 60% of streams that occur on these platforms are of songs that are, I think, as you pointed out earlier, older than 18 months or so. So it definitely seems like people are listening to older music. There could be all kinds of reasons for that. I mean, maybe it is, as Merck said, and people are scared or they're happy and they just want to relive the good old times and, you know, they don't really value new music or whatever. If you're, say, a one-hit wonder, a Milli Vanilli or, you know, something like that,

like, streaming actually could kind of give you a second lifeline. Yeah. Honestly. Definitely, because as we pointed out earlier, like, if you are a one-hit wonder in the let's say you had a what you had a big song in the 70s uh and that was it but then once you got into the 90s obviously the royalties for that weren't coming in and the only way you could get the royalties was as if some reason it got added to some classic rock radio playlist or whatever,

you get some royalties from that. But mostly people would have to own the physical copies. But now you've got the streaming platforms. And I do think that it's not so much an issue of people only wanting to listen to old music i think a big issue here and an article that you linked to in your piece pointed this out i think it was by liz pelly if i remember if i'm getting her name correct is that a big issue here is the creation of playlists on these streaming platforms like with the playlist with curation these streaming platforms are able to kind of dictate what people listen to regardless because like let's just say like you're in a mood it's

kind of funny like a lot of them prioritize the chill playlist like everything's chill on spotify it's like chill chill beats to whatever it's to study to yeah um but like you can kind of curate what people listen to um in a way so in some ways the game is rigged in that way and um and they do some rigging like that like to get on the splash page of spotify right like certain artists can finagle ways to like get more visibility in that way and then there's everything from like you know the the streaming farms i think i heard t-pain talk about like you could tell when an artist is really putting up numbers because like their streams will be in like you know los angeles chicago new york etc and when they're manufacturing those numbers those

places are like bozeman, Montana. An artist has 16 million streams in Boise, Idaho. Hobbs, New Mexico. Yeah, right. Yeah, it is very interesting. I say that just because there's ways to game it. Yeah, there certainly is. It's extremely crooked.

I mean, you mentioned earlier on the sort of relationship that the major labels have with Spotify. So, for instance, it's true that I think back in 2008, the big three all acquired equity in Spotify. So, you know, there was a sense in which they were sort of licensing their own songs to themselves right which is a which is a crazy thought they've actually been selling off those stakes on the whole i think universal still has theirs but but warner and sony might have divested themselves i can't remember but the point is that it's not really the shares which is the

mechanism through which they sort of exercise their influence on Spotify. It's the catalogue. Because, you know, if one of those labels takes their music away from Spotify, that's game over. So this means that they have a lot of influence and there's a lot of kind of opaque dealing that kind of goes on behind the scenes. So things like, yeah, things like playlist placements and deals for ad space and stuff like this. I mean, Spotify, this is slightly separate issue,

but Spotify is trying to run this thing called discovery mode where artists are offered a lower royalty rate in exchange for more publicity. So that might be what you're thinking of in terms of getting yourself on the page. Like if you're prepared to be paid even less. Yeah, it's like, how do you go lower? Which is payola is is you know it's it's it's you know the the the same thing that people were prosecuted for you know paying paying radio stations to to play songs back in the 70s

yeah another sort of mad spotify thing is this this thing of producing like fake music so that they'll produce these like sort of sounds alike artists will be like a bunch of like they'll get like a bunch of like swedish guys in the studio and get them to like record a country song or something and put it put it on the top of a country music playlist. Man, seven Swedish guys in a room in Malmo make an astonishingly large amount of the music we listen to anyway. It's fascinating. It kind of creates this situation where you don't even know what's real

and what's not, just like with all these other, just like with all content in general, like the viral videos you see and stuff. You're just like yeah. Yeah, there's a really Really great blogger for them in Krakowski. I mean he's a musician he has a band called a man I mean he was in a galaxy 500 sort of kind of sort of slow core band from the early 90s. He has one of the best blogs about the modern music industry, and he had a post about how Spotify is a form of misinformation, basically. That's so incredible. As you point out in your article

like you quote from mark fisher and regardless of how you feel about mark fisher and his like sort of diagnosis of the culture industry whatever in the mid-2000s it doesn't really matter how you feel about him because merc mercuriatus and the guys at hypnosis have basically banked their entire business model off of what he's saying. Regardless, they've basically said that, yeah, culture is essentially moribund. There's nothing new we can squeeze out of this. Let's just cash out our chips from the last 40 or 50 years of hits and just ride out the good times, I guess. I don't know. Like, they're banking, like, as you point out,

that, like, people are still going to be listening to, you know, Bob Dylan in 40 years, which they might be. I mean, who knows? I don't know. It's just, I don't know. It's very, very interesting. Yeah. And that's, you know, I think that's one of the sort of

really disturbing aspects of this is that the song funds have sort of triggered this bidding war where the you know the the major labels are now feeling like they need to kind of lock down these big assets so they're they're sort of coming in and blowing everyone out of the water with these you know 100 300 million dollar deals for for dylan and paul simon and stuff like that and in some parallel universe that's like theoretically money that could be being spent on new music or even going to artists, God forbid.

So just the idea of an economy where all this money is being spent on old songs. I mean you know a lot of old songs that I love as well but yeah it's bleak. not just the sort of opportunity cost of that money but once that money's been spent there is an incentive to generate return on investment. there is an incentive for for for to generate return on investment so like what are these people going to do like what what are they going to be prepared to do to try and get these songs in front of people try and get people listening to to all this old music well as you you pointed out in one of your articles like they've got like miley cyrus out there singing like you know heart of glass and like and then this just gets cycled back through the algorithm so that like every time you hit next on YouTube, like you're

going to get hit with a video of some newer artist singing an older song. Because it's, because in some cases, you know, like hypnosis have basically, you know, they've incentivized that to, to be the case or, you know, like have kind of that to be the case, or, you know, like, have kind of got Miley to go out there and do it. I mean, because she gets paid off of it, too, and it helps her. It's, I don't know, it's very interesting. I mean, but another sort of important aspect of this is, and you close your article by talking about this to the extent that new music is being created it has resulted in this process that um is i think it was maybe another writer that used the term but it's kind of like unbundling the song basically like to the extent that new music is being created it it sort of incentivizes like the catchiest hooks with like hooks that are instructive

like instructing you to do something like because then they can put that on a tiktok video and then that can get recirculated millions of times through these viral videos so basically it's the kind of deconstruction of the song itself into just like little bite sized, you know, bits of sugar, you know what I mean, that you can just sort of ingest. And then like that, again, it gets like cycled back through the timelines and algorithms and everything. I mean, it's called like, I guess hypnosis refers to it as song management or is that an entirely separate phenomenon? No, no, no, no, not at all. So, yeah, song management is like, yeah, hypnosis is phrased for how they're going to try

and maximize the value of the catalogs they bought. So it covers anything, basically, any avenue that they'll use to try and generate more revenue. So getting them placed in adverts what's called sync in the in the industry which is like getting songs in sort of films and and tv and stuff like that but another aspect of song management i guess is is trying to find some sort of new but kind of new ways of of licensing music and kind of new new ways of licensing music and new sources of income. Yeah, it's a right good term.

Sherry, who coined this term, deep unbundled song. Unbundling describes what the effect that digital technologies have had on lots of different industries. But the music industry example is what happened to the album after digitalisation. So rather than buying an entire album, you just get the songs you wanted from the file sharing site or then later go on iTunes and just for 99 cents, just download the three tracks that you actually wanted to listen to.

So the digital music took the old sort of economic unit of the industry, which is the album, and then kind of broke it up with disastrous effects for the industry bottom line. So the idea here is that that same process might, you know, might and kind of is being applied to kind of songs themselves. And you sort of see it, like you said, on sort of platforms like TikTok, that, you know, where the videos are sort of like 15, kind of 30 seconds long. So you need music that has the sort of, that sort of build up and then drop structure within a kind of like 15 second period,

because that's what the content creators build their songs around and you i mean you've seen this you see this throughout throughout history it's not like a new thing per se like the the medium always shapes like what kind of songs people can produce radio kind of helped to dictate like a sort of three, four minute pop song. Spotify has had its effect because I think it's like 30 seconds is the minimum amount of time that someone has to listen to a song before royalties pay out. So, you know, you've got 30 seconds to grab people's attention. Grab their attention, right. right but i think this is this you know this effect combined with the sort of funneling of all music basically into these platforms that's gonna have this homogenizing effect because you know they're just very one-size-fits-all you know like spotify pays out royalties the same for you'll

get the same royalties for like you know the like a skit on a rap album that you would for like a 20 minute long movement in a right in a like a symphony symphony or whatever right so they have they have these these platforms have they they impose these sort of effects much more like violently than than the sort of older media forms so you're saying like if you're making an album, the skit on the rap album needs to come back. Maybe you can get some more. I miss that, man. We don't really, there's no, you really don't see skits

and then they just kind of got weaker over time. We need the mad rapper back from the Biggie albums and all that stuff. Yeah, it's money. I don't understand. I don't understand it it's money so yeah yeah you know it's interesting because earlier i said that this disincentivizes new music i think hopefully by this point the listener will be able to see why that is because if you're a song fund like Hypnosis, it actually would devalue the overall value of your asset class.

So, for example, if new music is valued over old music, the value of those catalogs that you have, those assets that you have, will be worth less. And then you're not bringing in as much money to your shareholders, and etc. So, like, they are actually, they want a situation where new music is not made. That's not true. I guess you do need some degree of new music being made, but they want a situation where the older, the good times are what people, you know, are listening to in trying to evoke more so than the future, I guess. I guess they don't want music that's really like, has the future as its sort of like creative horizon. Yeah. I mean, what's really scary for them is, and I mean, I don't even know if, you know, I think sort of culture has become so sort of fragmented and sort of siloed that, you know, something like this is not really possible.

But like some sort of like big kind of cultural eruption that suddenly sort of devalues like all of the old music sort of like, you know, kind of like what sort of punk rock did to like prog. Right. Like any of these movements like rock and roll or punk or rap or anything, any of the kind of revolutionary changes in like creativity and artistry in the music industry that created these songs to begin with, they don't want that anymore

because that would render their assets of less value. Yeah, and it's not like they're in a position to stop that from happening. But what I would say is that the more catalog they acquire, the more they become a stakeholder in the industry. And that's how they're trying to position themselves as well you know they like like sort of murk has this thing about about sort of positioning himself and the company is sort of like advocates for songwriters who get who get a really shitty deal uh from from streaming platforms it should be said yeah so he's even he's even suggested that he's going to start

a union for songwriters um all right man the irony of which is of course that um you know like his greatest desire is to buy them out so obviously his his desire to sort of raise the share that a songwriter gets from the sort of the kind of music royalty pie is to kind of boost the value ofresentation because he's very well served by the system which keeps songwriters kind of precarious because that makes them easier for him to buy out. Yeah, it's a very cynical framing of the situation. Well, on this show, we've kind of joked about how Dolly Parton is kind of an interesting metaphor for the transformation of work in the neoliberal era.

For example, in 1980, you have her singing this song, 9 to 5, which was tied to this movie, But it was also kind of this anthem about like workers rights and everything. And then 40 years later, you have her singing five to nine, which is like an anthem for like the grinder, you know, hustle. Yeah. Yeah. Hypnosis is kind of a similar story, a similar metaphor. is kind of a similar story a similar metaphor you have them like you know the name anyways like as a kind of like testament to the model or you know the album as the sort of like model economic unit of music and now you've got the new hypnosis the new iteration of it which is a testament to like the fragmentation of it and the monetization, financialization of it as an asset. It's been completely stripped of all artistic value and integrity and it's just been completely put into the financialized churn, the mill,

to squeeze as much out of it as possible. Just an interesting metaphor, I think. I hadn't thought of it that way, but yeah, it's deeply symbolic. Yes, yeah. Well, I mean, so I think that probably about sums up our story here. I mean, Tom, did you have anything else you wanted to explore? Any other? Well, I was curious since we have an englishman on the on the horn here

during the pandemic rich i i watched uh 24 hour party people probably like four or five times just such a good movie and you know there's the scene in there where somebody's coming to tony wilson at all and saying to him we want to buy factory records we're willing to offer you like two million dollars or something and he has like this moment where he's like i can't sell it to you and the guy's like why he's like well i don't own it like all the artists kind of just it seems to be like tony wilson was like kind of like uh you know he of like a talk show host in England, and then he kind of started Factory and all that. And it seems like he was kind of a fan of the whole Manchester scene

and just kind of gave like Sean Ryder and Happy Mondays and whoever else was on the label just money to make their projects and just ended up losing a bunch of money. But he never really owned the Masters or anything like that. How does, I guess in all of your reporting on this, but he never like really owned the masters or anything like that. Like how does us like, I guess in all of your reporting on this, like, is there sort of a,

um, could you have a label in 2022 or something that was like, like the early factory where, uh, you had like artists, I guess like some sort of way that it could be a, viable label and pay artists commensurate with what they're bringing in. While also retaining, I guess, some ownership of their masters. Is that anything y'all thought about?

I don't know if there are still people out there signing record contracts in blood and stuff like that. It's sort of hard to imagine someone like Tony Wilson surviving in 2022. I mean, there are still independent labels and independent labels have always had business models that take better care of artists. So, you know, artists on indie labels will get a bigger royalty split.

And, you know, there might be a provision in the contract so that they get their rights back after a certain period of time. So the independent, like, label business model is still viable and it's still there. It's just that they have to exist within a system that's designed by, you know, by the big global corporations. And that's always been the case. And like any kind of sort of capitalist economy, the big actors are always trying to squeeze the space

that the kind of independent actors have to operate in. But just the structures that we've been talking about for the last hour or so have have made that even more difficult really i mean there's some pretty interesting stuff going on with this bizarre to say but like with the uk government at the moment which has been running this kind of investigation into the modern music economy so they they did a big report last year and and they sort of commissioned the this body called the kind of competition and markets authority to do a sort of investigation into uh you know whether the the music industry is like a quote-unquote healthy market and as part

of that they sort of solicited responses from lots of different stakeholders in the industry and they've been published um and they're i mean they're really interesting so you know anyone who's who's kind of interested on in like learning a bit about this stuff from the sort of the inside i'd say go to the go to the cma website and have a look at that because you get the you get the sort of like self-serving narratives from the major labels, but you also get perspectives from kind of independent labels. You get like submissions by campaign groups as the union of musicians and allied workers who have been running a campaign

to try and extract better terms from Spotify for the last few years. There's a group called, a sort of campaign called Broken Record in this country that's been sort of advocating for sort of changes in the law. There are, you know, there are like actually sort of relatively

like simple legal changes that can be made that would make a difference if there's the political will and the strong enough movements out there to advocate for them. On that note, Rich, I just want to thank you for your

time and thank you for your writing. If you want to read more from Rich, like I said, go to TheBaffler.com. Anything else you'd like to plug? Yeah, I've got some stuff in the real life tech website um i'm on twitter was it at at richwood all underscore i i don't tweet much but uh you know i should probably get back around to at least like

you know plugging my own my own stuff um uh so uh so just get on tiktok stuff. Just get on TikTok. Yeah, exclusively Hypnosis owns content, TikTok channel. Yes. But yeah, I mean, if you want to kind of learn more about the sort of modern music economy, yeah, read Damon Krakowski, the da-da drummer, Substack, I think it's called. Read the Penny Fractions newsletter. Read Liz Pelly.

um, read this Pele. Um, uh, and, uh, yeah, you know,

I, as, as, as fans of music, I think, you know, the, the least we can do is, is educate ourselves,

um, on, uh, just the, the, the truly insane shit that's being perpetrated in the, uh, in the,

the modern music industry. Definitely. Um, insane shit that's being perpetrated in the modern music industry definitely I think that's a good message to go out on thanks again Rich we really appreciate it we'd love to have you back on sometime and hopefully things stay sunny over there you know hopefully

you guys don't get another bout of that cloudy rainy weather we're all the time hearing about over here. Yeah, it's been a pleasure. It's been a pleasure. Thanks for having me. Thanks, Rich. Thanks again, Rich.

Thanks, Rich. This note's for you