Nettwerk's Blair McDonald has seen the music industry from all sides - from behind a drum kit, a label mail room, the big office at a major label, and the helm of his own indie to name but a few. Here, he shares some insight on the future of the music biz, what he's learned from being inside and outside the major label structure, and why Nettwerk is defending fans against RIAA lawsuits.
Question: How did you start your career in the music industry?
Answer: I was a drummer in bands in the West of Scotland and, when I was 21, I decided to try my luck in London. I needed a job to pay the bills while I waited for my drumming career to take off (I'm still waiting...) and wrote to six record labels and six recording studios. They all wrote back saying, “Thanks but no thanks”. Then the next day I got a call from Virgin Records, saying someone had just left there post room, and my letter was top of the pile so did I want the job. I worked my way up, first as a talent scout/tea boy, and then moved to Virgin Music Publishing. I moved to Sony when EMI bough Virgin and shut down the publishing division, to re-establish their (Sony's) publishing division (which had been sold off by CBS a few years earlier). I moved up to MD of Sony Publishing before moving to head Columbia in the UK. I was MD of the label there until in 2002 they “let me go”!
That's when I started my own label and publishing company, which was a huge learning experience, although from the opposite direction than usual. I'd been running a label, looking after artists like Bob Dylan and Beyonce, and then I was working with an unknown band from Cardiff trying to get them a couple of plays on the evening shows on XFM– it's was an exciting, if slightly scary, experience. I signed publishing deals with a few bands and through that started talking to Nettwerk about working with them, and we officially joined forces in 2005.
When you were running your own label what was the hardest part?
Finding the funding to keep it ticking over for any length of time. Even when you're working on a shoestring budget, relying on favors, doing everything as cheaply as possible, it's still hard to have enough capital even just to keep the lights on. Another difficult challenge is getting any attention for your roster when you're doing things on such a small budget. You have something that you believe in 110%, but everyone else just sees it as another one of those records that drops through the door.
So you’re now Head of Publishing at Nettwerk?
Well I guess I'm in charge of publishing at Nettwerk. Nettwerk has a very horizontal structure with no strict hierarchy.
Before you joined them, did Nettwerk have a publishing division?
It had always had a small involvement in publishing, just signing the odd deal with artists they were working with. When I joined we focused on developing that part of the business both in the UK and North America.
Record labels, publishing, management. Which would you say is the most important in the industry at the moment?
I think all elements are important because the artist needs all elements to be working together. An artist might make the bulk of their money from playing live, or from TV and film synch fee, or from selling records, but the artist needs all those elements to be working together for their career to be a success. Now more than ever it's about finding the right way to work in partnership with the artists rather than trying to grab rights from the artist. Nettwerk is well set up to do this as we have all the elements under one roof; publishing, management, a record label, a merchandising division. We (in the industry) have to remember that we're all part of a service industry providing services for the real talent, the artists and writers. Without them, none of this industry would exist. I find it distasteful when you hear individuals, be they managers or label or publishing execs, being lorded for what they do: they should all be beholden to the artists and writers.
Nettwerk provide much of their catalogue as non-DRM MP3s and FLAC files. Do you think the industry has been slow to develop the full potential of the internet? Has that damaged the industry?
Undoubtedly the industry has shot itself in the foot by trying to be protectionist, an attitude largely driven by the record labels. Managers have always been more informed about the industry as whole as they've been looking after all aspects of an artists career. Publishers have always licensed an intangible product and have made their revenue from licensing. Record labels have, by contrast, always had a fixed business model - selling disc of plastic for £10, a model that, until now, they haven't looked beyond. There is now a whole restructuring of that part of the industry. Nettwerk has arguably been a part of leading the way, allowing people to access music freely, on the basis that it's better for more people to hear the music, that'll get more people hearing about it and word of mouth is a very powerful marketing tool - an opportunity that most large labels have been slow to take up.
Am I right in thinking that Nettwerk are funding legal fees of some "illegal downloaders" who've had legal action brought against them by the RIAA?
Yeah, that's right. The RIAA was suing a girl who'd "illegally" downloaded music, and one of the songs mentioned in the suit was an Avril Lavigne track [who Nettwerk manage]. Terry [McBride – Nettwerk founder] released a statement saying that it wasn't in their clients interest for the lawsuit to be pursued, and to make his point, funded her legal fees.
Did this cause problems between Nettwerk and Avril's label?
I think the way Terry explained it no one could argue with what he was saying. I'm not sure what actually happened in that case, but no there was no problem with her label. I think they realized suing your fans isn't a good idea!