Max Hole: It’s Businesses as Usual

by on August 11, 2007

Max Hole is President, Asia Pacific Region and Executive Vice-President, Marketing and A&R for Universal Music Group International. He has some soothing words for anyone who thinks the internets might be a bit worrying for music publishers.

When he’s using words like “… record companies … sign and encourage great music by great artists. This will never change”, you know they’re in trouble. At least, in trouble in the long term. One thing that’s true in business as in life is that nothing is forever. Mr Hole’s analysis of the situation for record companies seems to be based on the idea that nothing will, or really needs to, change for the music publishing industry. Musicians have no interest in business or marketing… consumers demand much more than just the music… pirates are sapping the ability to find talent… We’ve heard it all before. If you repeat it often enough, it might just make it true.

Hole completely fails to address what happens if, as seems at least likely, the making, discovery and consumption of music moves from the physical world of gigs and CDs to a virtual one, and along with that, whether the gatekeepers will see the fences come down.

As a thought experiment, I tried reading his answer to the question “So nothing has changed then?” like this:

“What has changed is the kind of services we offer to companies once they’ve handed over their business to us. In the past we helped them access photographers, designers, producers, engineers, studios. We still do that, but we also offer a whole array of services that are internet-based which include promotion, marketing, eCRM services and building websites.

To an extent, companies can do this themselves, but it’s often more expensive, difficult and time consuming than if they tap into an organisation that specialises. We offer this different set of services once a firm has signed up with us, because it’s the nature of the business now and we have had to learn to talk more directly to the consumer than we did in the past. Most of the basics however, haven’t changed. Businesses still come in the door and say ‘make me profitable’, but now it’s ‘make me profitable the way I want you to make me profitable’. Of course, the issue is that if you take a big cheque off anybody, the bigger the size of the cheque, then the more concern over the investment.”

Ignoring the bits towards the end that he doesn’t explain (what does he think that’s actually changed? What does the need to “talk more directly to the consumer” mean, for example?), reading it like this gives an interesting perspective. If you had set up a business and wanted to get it marketed, would you hand over 100% of it to an agency who in return gave you a profit-related wage?

Again, nothing is forever. In 1865, Thomas Cook invented the package holiday when things like exchange controls were in effect, leisure time was scarce and people knew comparatively little of foreign cultures. It’s only in the last twenty years that the once mighty package holiday industry has hit dramatic decline in the face of a number of changes. The publishing industry has been around for longer, but that doesn’t make it permanent.

Here’s my prediction: by 2032, Universal Music Group will not exist in the form it’s in right now, no matter what Mr Hole thinks.

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