We didn’t go into business thinking that charging musicians to make submissions to the industry was the path to a $100m business. It’s not. We also didn’t think it was going to be easy to convince the industry this was the right way to go. It hasn’t been easy. But a platform that is better than anything else at identifying high potential songs and talent at the earliest possible stage creates a lot of value for everyone. And the longer we continue this experiment in business model innovation, the more compelled we are by the evidence that this is working.
It’s working for the industry because there is 11 hours of audio content uploaded to SoundCloud every minute (ref: Mary Meeker’s 2013 report on Internet trends) and the industry has no effective way of consistently finding the needles in the haystack. Music Xray is successfully showing them the needles.
It’s working for the musicians and songwriters who are ready for prime time because they get access to the deals and opportunities faster and for far less money than it would cost them to do it on their own, and they are landing those deals.
It’s working for the musicians and songwriters who aren’t yet ready for prime time because they get fast, inexpensive, & authentic feedback. And even if the news isn’t always welcome, it’s much better than spending months or years trying to reach the professionals who can credibly give them that feedback.
Music Xray would have no interest in pursuing a strategy that weren’t working. Just like musicians, we also seek quick feedback so we can make adjustments. We now have over four years of data upon which to base conclusions. And while there remain industry professionals and artists who aren’t yet convinced, we believe results are showing that this is one of the ways high potential songs and talent will continue to be discovered going forward.
User attrition by designWhat? That runs contrary to everything you’ve ever heard about online businesses.
Check out the graph to the left. It’s usually not a good thing for a business to lose 80% of its paying customers within 3 months of acquiring them and you can bet this is an ongoing conversation we have with our investors. It’s also why it took over four years for Music Xray to reach a critical mass where we have enough consistently paying users to keep our lights on. But the 20% we retain has added up and Music Xray is now a site where the bulk of the users are top tier musicians, songwriters, and bands. These are the users for whom Music Xray works.
Over time, this has created a vibrant and robust user base that creates good music and that’s why industry professionals now frequently tell us they hear more consistently good music on Music Xray than anywhere else.
What matters to Music Xray is having a lot of quality users – users that make great music, and quality industry professionals who are on the site to find that music. Our business model brings to bear a survival-of-the-fittest ideal. Many musicians just aren’t at a level that enables them to compete. Those users should be thinned out of the system so that they don’t drown out those who are at a competitive level. We do offer those thinned out users the ability to get help, career coaching, and professional critiques. This keeps them engaged and continues to deliver value to them. However, often the feedback they receive is to continue to develop, continue to write, continue to practice and therefore we lose them as users (at least temporarily) just the same.
Our purpose has never been to figure out how to make money from artists. We’re in business to figure out how to identify high potential songs and talent at the earliest possible stage. The 578 songs and acts that were selected by the industry via direct submissions on Music Xray in July plus the other 100 or so that were contacted by the industry via Needlestack Music Search suggest we’re doing a pretty good job. And by continuing to improve, we’ll eventually get to a point where we’ll be able to de-risk investment in music. That’s where we’re eventually headed.
De-risking investment in musicIn order to get there, we have more work to do. That’s what the next 18 to 24 months is about for Music Xray. But once we’re there, the company has the ability to become a center of gravity in the industry. By enabling professionals and their companies to source music, artists, and projects on our platform, by being able to determine which projects are lower risk investments, and by co-investing with the professionals and their companies we see Music Xray as an eventual business enabler for the industry on whole. And this is the more interesting conversation we have with our investors.
But Music Xray’s model brings with it additional challenges. Below, we list a few and we discuss how we currently handle them:
How we address challenges inherent in the model
Getting the industry’s attention before the data was compelling enough
For starters, we had to get the engagement of the industry, and there’s nothing more tedious than listening to unknown song after unknown song, much of it of questionable quality. So, we began sharing some of the submission fees with the professionals. This made tending to their Music Xray account more attractive than tending to the pile of CDs on their desks, their jammed-up inbox, and more attractive than trolling YouTube and SoundCloud. But it also got the attention of every hustler and shyster out there who thought they could make a few bucks off submission fees.
Submission fees were always meant as a throttle, as a way to incentivize musicians to filter themselves before submitting every song in their catalog to every opportunity on the site. Most serious musicians wouldn’t do that anyway, but the problem was the many over-eager musicians who didn’t know any better.
But in addition to acting as a throttle, as discussed above, when faced with the choice of continuing to pay to submit only to be consistently rejected and to receive bad ratings or to stop submitting, most musicians who aren’t ready for prime time stop submitting. This leaves the playing field to the top tier of musicians who are finding success on Music Xray. Success still comes with its share of rejection and it’s important that Music Xray show musicians where they stand and let them know when they should stop submitting and when they should continue to submit despite receiving some rejection along the way. We do that through a feature we call Diagnostics.
In short, submission fees were meant to protect the industry professionals from becoming overwhelmed and to protect the great musicians from being drowned out. Yes, submission fees are what keep the lights on here in the office but they emerged as a necessary part of the platform before we had a clear idea about how and who we were going to charge for the service.
The shyster phenomenon
To address this, we research the professionals who apply for accounts and we’re selective about who we invite in. We have more work to do on this front and we’re finding new ways to get better at this. If the opportunities don’t check out as authentic and the professionals’ resumes aren’t real we don’t approve the account. We additionally built in feedback loops where musicians can rate and provide feedback on the industry professionals with whom they interact via the site. Needless to say, it doesn’t take very long for us to weed out any misbehaving professionals.
Additionally, we observe submission-to-selection ratios. We know that most of the artists who submit are on the higher end of the quality spectrum, when we see accounts that almost never select songs and acts, we inquire. Industry professionals learn very quickly that if they are not on Music Xray to conduct real business they are not welcome.
Insuring reliable data
Another issue we found was that some industry professionals were not rating the songs they heard, yet they still were accessing the collective data (Needlestack Music Search). In response, we continued to make rating optional but we blocked access to the data for those who were not rating.
This created another problem. Some professionals began rating insincerely, or too quickly to be authentic, or simply rating every song the same – all in an effort to be expeditious. To address this we introduced an advanced algorithm that acts to police the ratings. It alerts us if a professional’s ratings are consistently inconsistent or consistently divergent from the ratings the same songs receive from other professionals on the site. The site sends out a warning to the industry professional to let him know that we’re observing and taking note of this behavior. If after two warnings the behavior persists, that professional has his ability to rate revoked along with his access to the collective data.
All in all, this overview of how it works is probably more interesting to academics who study business models and human behavior incentives than to actual users of the site. But in keeping with the company culture of transparency, we’ve decided to reveal some of the things we’ve done to make Music Xray work simply because it demonstrates to our users that we are here to build real solutions. As much as we love music and the business of music, we’re geeks at heart. But we’re geeks who have been working in the music business for many years – before it all went digital. But applying technology to professional talent discovery is something we’ve been focusing on for thirteen years.
We get it.
We’d love to hear your feedback in the comments section below.
It’s true. In September of 2014 Music Xray is hosting dozens of the MIPs you see on the site in Barcelona for our first annual Music Xray Day! They are all sticking around for Future Music Forum, which starts the very next day in the same venue. THEN, many are sticking around for the weekend, when Barcelona throws itself one hell of a party. It’s the best weekend all year to be in this amazing city. Trip Advisor calls it “The biggest, baddest, loudest, happiest, ‘fire-iest’ mother of a festival ever.” Microsoft recently featured it in a TV ad which you can see here:
GET YOUR BADGE FOR FUTURE MUSIC FORUM HERE!
Then, forward it to us at firstname.lastname@example.org and we’ll get you in the invite-only list to Music Xray Day, which takes place the day before, on September 17th.
You’ll be hanging with top A&R’s, music supervisors, managers, producers, radio station program directors, label heads, and music tech founders and CEOs. You’ll hear insightful panels, keynote addresses, TED Talk-style presentations and some fantastic music.
Think, music in the streets, parties, incredible nightlife, and it all culminates with an impressive fireworks display that rivals New York’s 4th of July bravura.
Day 1 of the event will be an exclusive, invitation-only session just for professionals and artists with Music Xray accounts. Days 2 & 3 will be a larger event with pre-approved participants, there to do business, mix, and network.
Space is limited so go here to get your badge. Then, once you have it, forward it to email@example.com so we can get you on the list for Music Xray Day.
Sticking around to experience some of the weekend is worth it. In addition to everything that’s happening around the city (music, street parties, human castles, and the baddest fireworks display you may ever see), we’ll be organizing some group activities like a boating outing, maybe some beach volleyball, and some dining in Barcelona’s world class restaurant scene. These things will have a pro-rata additional cost for those who want to take part but we’ll do a good job of keeping it real.
By the way, the festival itself lasts through Wednesday the 24th and the fireworks display is the night of Tuesday the 23rd so you’d have to stay through then to see it, but there’s plenty going on Saturday and Sunday for you to feel like you experienced it.
More on the festival below.
We recommend that you start booking now. A couple modest but decent hotels that are centrally located and near the evening activities (and a short taxi ride to the main conference venue)
Hotel Evenia Rocafort.
Things to do in Barcelona.
Come join our team in New York City (Financial District)
Our Music Tech Startup, Music Xray, is seeking smart, music centric individuals to come learn the A&R ropes with our team in New York’s Financial District – right near Wall Street.
We’re looking for fun, energetic, music minded individuals who are passionate and curious about learning the A&R process and working at a music tech company. The internship will involve online elements of A&R, Networking, and Music Marketing. Interns should be comfortable working in a fast-paced environment, be self-starters and have excellent writing, communication, and organizational skills. Interns should also be computer literate (Mac savvy and familiar with online social platforms). Being a musician, playing in a band and knowing the local music scene are big plusses. Having previously interned at a start-up is also a plus.
You will be working closely with the business development team and therefore getting a more hands on and interactive experience. As an intern, you will see how MusicXray manages a large community of musicians and deals with user issues as well as facilitating dealings and relationships between musicians and industry professionals.
For College Credit only and some extra perks! Requested Availability: 2-3 days/week
Interested candidates should send an email with their resumes and cover letter to Joseph Sunder (firstname.lastname@example.org).
Our internships are considered unpaid, but we do cover some costs of daily commutes, some food, a small stipend, and free beer!!
As you may know, Music Xray previously delivered a weekly digest to all musicians with songs uploaded into their accounts. The digest alerts musicians when industry professionals are seeking songs that specifically sound like songs they have in their accounts. These digests had been discontinued over a year ago while we did some readjusting of the service. Now they’re back and here’s why you should care!
When industry professionals list new opportunities on Music Xray, we enable them to upload songs that sound and feel like what they are seeking. This is especially useful for music supervisors who may have a scene in a movie for which they need music. Maybe they would like to use “Satisfaction” by Rolling Stones but the movie’s budget isn’t millions of dollars, which would be required to license that recording. When the supervisor uploads “Satisfaction” into their dashboard, we have software developed by Queen Mary University in London that analyzes the acoustic properties of the song and understands what it sounds like.
Musicians with similar sounding tracks in their accounts are then alerted via these new weekly digests!
Pay attention to the digests to see if any industry professionals are seeking songs specifically like yours. Also, make sure you have all your music uploaded to your account. You only receive alerts for songs you have uploaded (for free) into your Music Xray account.
Additionally, new music fans sign up to Music Xray every day and we classify their music taste. So our digests ALSO alert you when we’ve detected new fans whose taste profile matches your music’s sound and feel. When you have new potential fans, you can target them by clicking the “Target Fans” button next to each song on your dashboard. You can also see your opportunity matches there by clicking the “Sonic Opportunity Matches” button.
As you may know, Music Xray Day and the 5th annual Future Music Forum take place in Barcelona this September 17, 18, & 19. It leads into the best weekend all year to be in Barcelona. It’s the city’s famous La Mercè Fesitival, when the city puts on one of the world’s biggest parties.
Come join us. If you’re a professional on Music Xray, you’re invited to Music Xray Day and the rest of Future Music Forum. Artists can come for just €150. Click here.
Introducing Version 1 of Needlestack Music Search. It’s pretty cool and is already resuting in many more professionals finding the songs and acts they want to work with.
Our intention with this product is to make it an indispensable tool for industry professionals, giving a competitive advantage to those who use it and leaving those who don’t behind. Given that it’s free, there’s no reason not to give it a try and decide for yourself.
We’re announcing it’s launch today, April 14th at Sync Summit Paris. Click the video below to see how it works.
Click here to read the full article.
We thought musicians and industry professionals who have never seen this before will be interested in seeing exactly how the industry is using collective efforts and advanced software to identify new songs and talents. Essentially, it’s a “behind-the-scenes” at Music Xray. See how the site works from the perspective of industry professionals when they receive music that is submitted to them.
This article was originally posted by Jack Ponti as a response to this pov piece written by Music Xray Co-founder & CEO, Mike McCready.
There’s a vast misconception concerning the way new music and talent is discovered in the new paradigm of the Internet.
Where are all the DIY success stories?
While it’s true that anyone can now simply create a web page, populate every social media site there is, and virtually self-promote and distribute music, the reality is that 99.99% of that music will only be heard by family and friends. If the rallying cry of “we can do it ourselves” were true, then why are there not thousands of success stories? Because the ability to market and promote inside a clogged bandwidth is virtually impossible. You can’t build critical mass. This also creates a big problem for the industry. There is no filter.
Now, one may say the lack of a filter, gate keeper, standard, etc. has allowed music that would have never been heard a chance to be heard. But by who? Surely not the masses. It’s most likely to be heard by only a few. Sure, now anyone with a song can go full-bore Internet crazy and do all the wonderful things that people claim will help build their career, but it’s just not true. Again, where are all the success stories?
The industry’s pre-Internet filter:
Pre-Internet, the music industry had a filter. Perhaps it didn’t work all of the time and I am certain some great music was lost along the way due to that filter. The filter involved the artist knowing someone with genuine access who could get their music to someone who could actually do something about it. The filter also involved a policy of “no unsolicited material”. Meaning it would not be listened to unless someone vouched for it.
There was a dual role in the no unsolicited material policy.
One, was it avoided deep pocketed and pointless lawsuits. If unsolicited submissions were allowed, someone could randomly send in a demo and then months later find some ambulance chasing attorney to file suit claiming infringement, hoping the label/artist would settle. But the primary reason for the policy was that if you allowed unsolicited material you opened the door to everyone on Earth who believes they have talent. And most don’t. The mountain of material that would have been sent in would have taken thousands of people to sift through. So yes, we more than likely lost some genius talent due to the restriction of that filter but we also found plenty as well.
The industry believed that if a known manager, lawyer, publisher, producer, etc. was presenting music, it must be somewhat good. Now granted, it sometimes wasn’t. But for the most part, it met a standard and certain level of professionalism. It also spoke of the artist’s, writer’s, or producers’s, own ability to hustle and get to someone with genuine access. It worked well, as evidenced by decades of music.
But I have always said, the next Beatles were in a basement somewhere and will never be discovered due to lack of industry access. I’m sure we missed out on plenty.
In my 35 plus years in this business, wearing every possible hat that you can, 99.99% of my success was directly due to a filter. I was hammered by one of my clients to listen to India Arie. My manager introduced me to Jon Bon Jovi. A&R men brought me countless projects in development. Lawyers made introductions. The list is endless.
So here we are in the Internet age. No filter, no gate keeper, it’s a free for all!
But what do you do to genuinely find exceptional talent? Google search “good music”? Good luck with that. YouTube? If you have a decade of time on your hands. Reverbnation, Facebook, Soundcloud, Twitter, sure there are a multitude of possible places, but none of this has been filtered.
Unfortunately without a filter, you have to sift through hours of horrendous music to find even a remote possibility. Why? Because just like in pre-Internet days, anyone who can play any instrument or remotely sing is now convinced they “have what it takes” and they just clog the bandwidth with music.
Even from a psychological point of view, pre-Internet, people somewhat filtered themselves, thinking (or knowing) they were just OK, and why bother. But with the proliferation of TV shows like American Idol, we are now in the “yes I can” stage. Though that is wonderful, it can also be painfully unrealistic. Then with the advent of sites like CD Baby, people assume stardom is around the corner. For some it is. For many it’s not. But the illusion is real and by having a web site and distribution, suddenly you are there, or so you think.
I am not condemning that nor making fun of it. It’s wonderful to share your music with people and even if that means sharing it with only one other person that is a success and should be applauded.
However the heartbeat of the music business is new talent and there is a tremendous amount of undiscovered new and brilliant talent lurking out there caught in the miasma of a clogged Internet. Like I said, we missed some great talent along the way and truth be told, we are missing way more now.
A true and accurate filter will bring that talent to the forefront in rapid time. I salute and respect those who chose to go it alone, DIY, indie, whatever you chose to call it. But this business needs new talent and for those who want to be within that framework, they need to be discovered. Be it an artist, writer, producer; they need to have access and we, as an industry, need to access them or we’re all in trouble.
There has been a method of A&R research in place for over a decade now. It works very well, however it relies on spotting blips on the radar screen of something already in motion, something that has traction. Be it local or regional sales or radio airplay, it is already moving.
The same can be said for the recently announced deals with Twitter and Shazam moving into the label space. That is not discovery of talent, rather that is identifying moving targets after they start moving. The very essence of how Shazam works is you have to be searching for something you have already been exposed to. The same can be said for the concept of using Twitter as an identifier. Both are post, not pre.
There has been no genuine, and accurate, A&R filter in the entire industry to sift through the clogged space that we are currently subjected to. In order to do that properly you need to create the proper mechanism that is human based and software synergistic.
As you know, Mike [McCready of Music Xray] and I began in a highly acrimonious relationship, one of war. We have been speaking and meeting for months now, coming from opposite ends of the spectrum to find a genuine solution for the lack of a true A&R filter. We had opposing views but have come to agree. Chances are this is something monumental. I am convinced we are building that now.
The benefits to both the artists and the industry are enormous and I truly believe we can make a difference.
Musicians can submit music to Jack Ponti’s Merovee records by clicking here
Better late than never. But they won’t work.
I’m fond of saying that in the race to adopt new technology the music industry finishes just ahead of the Amish. And while I wholeheartedly applaud the late embrace of technology and data in the context of the recent deals with Twitter and Shazam, in my opinion, these particular deals won’t generate the hoped-for results.
The deals I’m referring to are the recent partnerships between Twitter and former Warner boss Lyor Cohen’s new 300 label and the partnership announced yesterday between Shazam and Warner Music Group. Both deals seek to leverage the data generated by the two tech companies to help identify emerging songs and talent.
Both Shazam and Twitter have had for several years the vast amounts of data that 300 and Warner want to tap. And both tech companies operate primary businesses that have nothing to do with helping the industry achieve the goal of “early discovery”. Rather, they generate an enormous amount of potentially relevant consumer behavior data and these music companies are going to apply their resources to try to make sense of it. Presumably, the goal is not only early discovery, but also the reduction of risk when Warner and 300 invest in promoting the music, since they will likely have a lot of clues about where they should spend their resources both demographically and geographically. It follows that since Shazam users are already performing an act that has them engaged with the music, Warner sees the deal as providing a channel into a receptive market.
1. Social signals are highly unreliable when it comes to emerging music.
I am certain that these deals will generate occasional successes. But I’m also certain they will not constitute an efficient and consistent method of finding the needles in the haystack. Social signals already constitute an arms race between those trying to make sense of the data and those trying to spoof it. The spoofers only have to continue to lead that race for the data to be too noisy to be consistently useful. Regardless of the number of data scientists thrown at the problem, if the signal to noise ratio is too high, there’s no useful data of which to make sense.
With 11 hours of audio content uploaded to SoundCloud every minute (leaving aside YouTube, BandCamp etc), it’s not even always about the false positives spoofers can cause. It’s also about the amazing songs and artists that don’t bother to spoof (or aren’t good at it) or even bother to try to cut through the noise. I’m talking about the 4m+ tracks on Spotify that have never been heard, not even once – or the 32% of songs on iTunes that sold one copy or less. Much of that music probably sucks – but not all of it and the great stuff will never be detected by the data Twitter and Shazam can provide.
2. Social signals are a lagging indicator and do not highlight what will gain traction, only what’s already gaining traction.
Furthermore, both Twitter & Shazam are, at best, only able to assist in early discovery, as opposed to first discovery. There’s a big difference between the two when you look at the potential return on investment for the music companies as well as the size of the opportunity itself. If Warner had been first on Macklemore & Lewis instead of just early the opportunity would have been bigger and the returns on that opportunity would have been higher.
The data provided by Shazam and Twitter will always be a lagging indicator, meaning that by the time songs and bands get meaningful traction on Twitter or Shazam, Warner and 300 will probably be second to arrive and will find early investors already there. Even if the traction were 100% organic and not generated by a financed push, the gained traction would be at least as observable to the artists and their camps as it is to Twitter & Shazam. That means worse deal terms for the music companies and a burden of finding early-stage backers most artists can’t (or don’t want to) bear.
3. Social signals leave too much behind.
Additionally, Twitter and Shazam are rarely ever going to detect the killer songs written by the non-performing songwriters, top drawer material that comes from unknown songwriters who aren’t plugged in to the industry, and bands and acts who aren’t breaking through the initial noise barriers that prevent them from getting any serious traction.
What will work.
What the industry needs is a true A&R filter. One that provides a leading indicator of success potential. One that offers true first discovery rather than early discovery. One that enables the industry to lead, taste-make, and influence rather than follow. Those who know me know I’ve been pursuing this holy grail for the industry since 2001.
The number of songs and acts that have been offered deals after having been discovered by the industry on Twitter and Shazam is unknowable, but in 2013 alone over 4750 songs and acts were selected by the industry for opportunities at Music Xray. That’s over 90 a week or about 1 every 2 hours.
I spent a good part of last year arguing in online public forums and then privately with Jack Ponti, a well-known industry veteran who opposed Music Xray’s approach to solving these A&R filtering challenges. But after months of back-and-forths and eventually a few afternoons spent with a whiteboard hashing out the current product and incorporating elements of Jack’s views on market segmentation, we were able to come together to construct a product road-map for 2014-15 that will perform even beyond my previous expectations, which of course were already high.
Music Xray seeks to be the industry standard for A&R filtering and music supervision tools. It’s a collaborative effort of 1200 early-adopting industry professionals who all make their living with their ears. They enact an open door policy to unsolicited submissions via Music Xray but Music Xray’s toll-booth business model puts the artists themselves in charge of the first level of filtering. Sure, some junk gets through but it’s filtered out quickly leaving only the top material to be heard by most professional users. Many of the submissions that come through Music Xray are songs that have never been released in any way, shape, or form. Shazam and Twitter are never going to shine a light on them.
Music Xray is currently used by 17 major labels but it’s still largely the forward thinkers who are benefitting the most. In fact, not all professional users of Music Xray even take advantage of the site’s most advanced and useful features. But over time, as we continue to insist on product excellence, Music Xray’s results will scream high above the din of the 11 hours of content uploaded to SoundCloud each minute. And if only 0.01% of that music has any commercial value at all, that’s over 90 minutes per day of commercially worthwhile music that ought to be discovered by the industry.
Co-founder & CEO