I first met Rio Caraeff in 1999 via Rob Lord. We’ve remained friends over the years and I wish I saw Rio more than our current schedules and geography allow; he’s one of the smartest thinkers in the space. But not only can Rio work through the problems and opportunities of the future media landscape, he’s one of the very few who has been successful connecting large media incumbents with the future in a practical way. He doesn’t sit around and shout about what *should* be done, from leading mobile strategy at Sony to digital at UMG through crafting the joint venture between the major labels and YouTube known as VEVO Rio has shown that he can get old and new media to sit together at one table and chip away at the problem in front of them together.
Rio joined us for This Week In Music last week via Skype. A few choice quotes:
“The origins of VEVO started with one thing: how do we take the audience that loves music, the billions of people on the planet who connect with music in a passionate way, and how to we provide them with access to the music any place they want it in a model that scales well and generates more revenue per view than ever before.”
“The root of the problem was no one was making any money. The audience that loves music wasn’t valued in the same way the audience that loves sports or television programming was valued. Advertisers were not willing to pay a premium price to be associated with the audience that loves music.”
“We’re talking about hundreds of millions of dollars here. We’re not trying to do something that’s a small business or a hobby. Fundamentally we’re talking about a business that’s going to generate billions of dollars of royalties in very short period of time. In only 18 months in the marketplace we’ve returned more than one hundred million dollars to record companies.”
“A very large percentage of our audience is still coming through YouTube but a fundamental strategy is placing our music videos everywhere. We have more than three thousand artist pages on Facebook where VEVO is the predominant tab. You can premiere videos on AOL Music, Univision or our iPad app. It’s like telling people you can drink from whatever faucet you want to, but some of that water is going to come from our well. YouTube is so large that most of our views come from there. About 30% of our videos come from YouTube in North America today.”
“Just because a video can be on the web doesn’t mean it’s innovative and interesting. It’s the same video that was on TV in 1981. We think the video should be aware it’s on the Internet. It should be conscious it’s on a two-way communications platform.”
“Sitting back and waiting for other people to solve your problems is not a strategy. Sitting back and saying ‘How come advertisers don’t want to pay for music videos?’ and then faulting the sales forces of your licensees or saying ‘How come this company isn’t paying me enough for my music?’ is a myopic approach. I wanted to build something and do something, not litigate or license. I felt this was a real opportunity for the music business to focus on a business that scaled to billions of people, that wasn’t dependent on selling recorded music, that was built upon partnerships and working with the industry in a collaborative way, was ultimate focused on what was best for the fan who loves music and could focus on generating more revenue per play than had ever been done before.”
Thanks, Rio, for taking the time. Hope to see you soon.
After Rio, Kickstarter co-Founder (and reformed music critic) Yancey Strickler stopped by to talk about what he’s been listening to. A few goodies were covered, but he led with a rad dub record I’ve since fallen in love with (thanks!) by Peaking Lights.
Tune in today (Friday August 12th at 4pm PT) when our guest will be lawyer to artists such as Will Smith and Beyonce, Ken Hertz!
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