Peter Gabriel: Digital Music Entrepreneur

Peter Gabriel, who co-founded UK online music distributor On Demand Distribution (OD2), which was sold to U.S. company Loudeye in June for $38.6m, talks with CNN on the future of the music biz, digital distribution of music, and stuff:

Anderson: What motivated you, a successful, musician and artist in your own right, to get involved in the business of digital distribution of music?

Gabriel: A number of reasons. I thought it was a good opportunity. I think it’s very important for artists to get involved in the distribution. A new world is being created — one is dying — and if artists don’t get involved, they’re going to get screwed, like they usually do. My father pioneered this sort of digital content of electronic content in the 70s with a thing called “Dial-a-Program” and that was trying to provide entertainment-on-demand, education [and] all sorts of things that are now part of our everyday lives. And so I’d grown up with the idea that everything should be available on tap to everybody, so that was an interest for me. When we were working on this idea of an “experience park,” sort of involving artists and scientists, we met a guy called Charles Grimsdale. [He] was running a company in Bristol, which was doing virtual reality, and that’s how our connection originally happened. He approached me and said: ‘I’ve been thinking about looking at music, do you think this is interesting?’ And then we got involved and started it up and that was [in] about 1999, I think.

….Anderson: The Internet has transformed the way we buy and listen to music; the digital revolution has an opportunity to transform the way that music is physically made, doesn’t it? It’s always been the big guys running this industry so is this an opportunity for musicians to come to the fore at this point?

Gabriel: Well, I really hope so, and there is an initiative that I began with [musician and producer] Brian Eno, called Mudda, which is a magnificent union of digitally downloading artists, and unlike OD2 — which was always set out to be a commercial venture — this is a more idealistic venture, which would be owned by artists for artists. So, there would be no business people or investors you [would] have to satisfy, but we need some initial capital, so we’re working on that at the moment. But the theory then is that artists could become their own distributors, almost certainly with their record companies, but they can deliver stuff independently if they want. It’s not really trying to set up something in opposition to the record companies, but for instance, on some deals now, an artist on a download of an album, or sorry a track, would see maybe only eight pence a track, which is much less if they would see in a physical sale. What I’m afraid of, personally, is that the business will, every time there is a technological breakthrough, the business thinks: “Ah, here we have another chance to claw a big chunk of the cake back for the business and away from the artist.” And I think it’s really important that artists act together — which we are notoriously bad at doing — and I hope that this union idea may get some blood behind it, and we will be able to become our own retailers in part.

Anderson: But you’re not suggesting that record labels are going to get written out of the game, surely?

Gabriel: Well you see, I think that a lot of artists aren’t very good when it comes to marketing or accounts or doing a lot of the jobs that record companies do, so we’re going to want somebody to do that. And probably the people we will look to do it are probably those who have the experience. But what I fundamentally believe is that the relationship should be a partnership. It shouldn’t be “we own you therefore we do what we want with your work.” Those days should be gone, and if artists aren’t smart enough to get off their arses and change that now, then we deserve what we get, because we have the opportunity [to change that]. It’s quite hard talking to artists sometimes to get them motivated because there is not a lot of money in it at this point. But I think there will be and it’s more sort of a power balance and I just think people in record companies now are a lot more willing to consider power-sharing deals.

Anderson: Do musicians then become retailers themselves?

Gabriel: Well, I think you’ll have options. I think for your specific group of hardcore fans, you’ll be able to sell them all sorts of things, as some artists are already doing. For the groups that I love, I would love to hear the whole creative process — not just a piece of product that someone in a record company has decided is the only thing I should hear. I want to hear them scratching away trying to write the songs, failing to get the mixes and arrangements right, doing things in different ways, hearing different live versions, acoustic versions — whatever it is. That whole process should be something that is available, where artists are comfortable opening it up to the public. You know, I feel fine about that and that sort of thing artists should be able to sell directly to their audience, you know once they’ve produced a piece of product as the business would call it, then it should go through all the normal commercial channels and all the normal retailers and there may be some special collaborations that people can do with different retailers because they have some marketing experience, they have some of their own music lovers that they will get to, that you won’t. So, I think we all need each other in some way I’d like it to be a level playing field.

Anderson: I suggested that you have been a pioneer in the digital revolution as far as the music industry is concerned, what is the future?

Gabriel: The future should be [that] you can get anything, anytime, from wherever you are, anywhere, and whoever you are, whatever country, whatever language you speak. And then the question that is fundamental to me that follows that as day follows night, is how do I actually filter the stuff, how do I really get to the stuff that means something to me? And that you can only do with an intelligent filter systems, and we were beginning to look at that with OD2 and I’m sure we’ll continue. It’s something that interests me a lot because you have limited time, and you don’t want, like with e-mail, you don’t want all of the junk, you just want the bits that have some meaning for you.

I agree that ubiquity of access and filtering are the wave of the future, and I also agree that labels are going to have to resign themselves to being “partners” with artists, not their masters and commanders.

Note changes in the Gabriel physiognamy.