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Building a 21st Century Record Label

Nick Gatfield
Former Chairman and CEO, Sony Music, UK

Learning outcomes

  • How one would build a major record label from scratch in the 21st century
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Executive Bio

Nick Gatfield

Former Chairman and CEO, Sony Music, UK

Nick is a British music industry executive with over 34 years of experience scouting, signing, and working with global artists such as Amy Winehouse. Nick started his career as a musician in the band ‘Dexys Midnight Runners’ before moving into recorded music. At the age of 26, he was made Director at EMI Records, the youngest in the company’s history. Over the next 20 years, he went on to lead global labels such as PolyGram and Island Records and has worked at three of the four major record labels. More recently, as the Former Chairman of Sony Music, he was leading negotiations with Spotify and both new and old artists in the repertoire. Nick currently runs Twin Music, an incubator for new talent, which funds and services new artists coming to market.Read more

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Interview Transcript

What would you really be focusing on if you were running a major label today?

There are two things, I think. The interesting thing is, if you were to say that there is a blank piece of paper and you want to construct a music company for the 21st century, I think we’d have to find a way to build a profitable business by working with artists at whatever stage in the career they happen to be. How can you cater for those middle-tier artists where you are not going to lose your shirt and you provide a service? You have to figure out how to go from a rights ownership to an artist service business.

I would make sure that the skillset of that company really understood how to incubate talent and that they really understood the needs and requirements of artists, in that middle tier, to sustain their careers. Then have the scale and the reach and the muscle to be able to provide that big global marketing reach, when it comes to global superstar releases. It’s about building a viable business at every stage of that artist’s evolution.

The other side of it is, in my very small way, we get involved with artists at a very, very early stage. I always call it pre-data. Because we take that risk, we do get a share of the assets that we invest in. But invariably, our deals are short term. We don’t tie artists up to a long-term contract. I think that is the future. Artists need to stay in business because of the quality of service and the relationship that you’ve built, as oppose to, we have a contract that says we’re in business.

It’s looking much more at the artist’s community and saying, we’re partners as opposed to rights owners. That’s one way of doing it and, again, making sure that the skillset in that business is totally geared to the needs and requirements of artists in this current day and age.

If you were looking on a different level and saying, I’m going to acquire a major, there is a huge amount of duplication within major music companies. It’s built that way. If you look at a company like Universal, in the US, you’ve got four fully staffed, full blown recorded music companies who are all, largely, doing the same thing and competing. They’re not only competing for artists but they are also competing for radio slots; they’re competing for Spotify love. If you look at America, radio was always the driving force. You really needed radio to drive music. Nowadays, radio is not what it used to be. Streaming is what is driving consumption; that’s where the business is. Radio often comes after that and still has a value to play, but it’s nothing like the driving force it used to be. So why do you have four full blown companies, with full blown national radio teams? Does it really make sense?

Why is that?

Because it’s legacy. It’s the way it has been built. I think you can easily argue, with a blank piece of paper, that I’ve got this incredible catalogue but I want to build expertise within this business. Let’s say I have great expertise in hip hop marketing and digital and audience understanding. I’ve got great expertise in rock and pop and various genres and that’s how I’m building my hubs around this business. But I can still plug into a phenomenal distribution machine and, you know what, one national radio team, to service all these various centers of expertise, around these particular genres.

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