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One to One Magazine
May 2009
Q&A with CEO and Co-Founder of California-based Audible Magic.
Vance Ikezoye talks about music, digital delivery, and protecting content out in the wild.
by Joy Zaccaria
The content identification technology at Audible
Magic allows a client to build a reference databaseof known copyrighted works of music, movies or
television programmes. How does this work?
We work with record labels and studios to register content they own in the database. When we see unknown content in the world, in the wild, we take measurements, compare them to our references and identify the content. It’s an automated ‘name that tune’. Somebody can give me a CD or an MP3 file and we can identify that content, if it’s in our reference database.
Vance Ikezoye
How do you work with companies in the physical
media, replication, manufacturing world?
Manufacturers can find themselves in a situation
where if someone asks for 100,000 copies of a CD, and
it happens to contain Sony music or EMI or Universal
music, then the replicator can be held for direct
infringement. Replicators use our services to identify
these works for such jobs to make sure there isn’t any
copyrighted content. If there is, we can ensure that the licences are appropriate for the content. We are
information services and our primary work – our
existing accounts – are in CDs and music.
What issues is the physical media business facing,
in your opinion?
We see our business in the physical media business
declining. There is a lot of consolidation among
replicators and they are all under price pressure. It
hasn’t been a growth area for our business.
But your company is doing so well in the US and
growing throughout Europe. What’s happening to
help with this growth?
Mostof our business is in digital delivery. We provide
the same kind of services that we do for replicators
for services online or through mobile phones.
Replicators are one element in the distribution
process. Sometimes they get unknown content for
which they need to identify the rights before they
distribute it. We do the same thing for MySpace,
YouTube, and Nokia for their Web 2.0 user-generated
content sites.
What do you do for these kinds of user-generated
content sites?
When people all over the world upload content to MySpace, YouTube, or Dailymotion we provide a service that allows them to check the content for copyrighted movies, television or music.They can identify and apply business rules that the copyright holders suggest– ‘this is allowed to be used, this isn’t allowed to be used’. In the same way, copyright holders would still register the works with us and tell us whether or not for MySpace, these might be allowed to be used.
It’s up to the sites to keep it legitimate. In the
same way replicators have to make a decision
about whether to replicate a job or not.
What are the main issues in that world of
music-sharing sites?
The big problem there is that nobody has figured out how to make any money on it– all these services are free and they are struggling to figure out how to pay for it. It’s like replicators doing their replication of CDs for free and then trying to figure out ‘Now how do I get paid for this?’
The issues regarding copyright, whether the
sites are making money or not, are still there. It’s
the same struggle replicators have: their margins
are decreasing and being squeezed but they still have legal responsibility. The replicator or digital
distributor could still get sued whether they are
making a profit or losing money, it doesn’tmatter.
Moving forward, how could you work with
sites such as MySpace or YouTube to deal with
these problems?
We look into ways of helping them generate revenue with their content. For example, they could enable licensing and potentially monetize that through other things like advertising.
If there’s a piece of copyrighted content posted
on to MySpace, for example, it should be readily
identifiable. The idea is that if it’s a video from
the Golf Channel, in theory you should be able to
identify itas from the Golf Channel and be able
to link to advertising about golf balls and golf
clubs and golf courses and travel.
How have you been growing in Europe?
All of Audible Magic’s new European clients are in
this whole digital delivery area. The core issues
are still copyright, the identification of copyright,
and the ability to know what it is. We have
recently opened offices in London and Paris and
we expanded our European presence with new
clients such as sevenload, RTL Group’s Clipfish,
France Telecom Orange Vallée and Telefun.
What will physical media need to contend with
in the future?
As far as physical media is concerned, different
segments of the consumer market embrace it.
The problem is that it’s going to be harder to
support the different forms of physical media. With the distribution market moving towards
digital delivery, the industry is not big enough to
support the infrastructure required for the
physical media.
The industry also has to get used to a few
different transitions. It’s tough for copyright companies because, from a music perspective,
everything is song-oriented or track-oriented. CDs
are a collection of tracks. Potentially there is
something there that can be leveraged.
Traditionally, artists feel like their whole
album is their ‘work’. Not just one song. This is a
struggle for the label as well. Consumers go from
buying 12 songs at a time to buying one or two
songs at a time. The label’s revenues are going
down as well.
We’re in this whole transition area. No one knows what’s going to come out of it, but everyone knows it is a tough time. We’ve been growing and I wouldn’t say it’s been tough for us, but we’re not a big cog in this whole wheel. We’re a supporting, albeit necessary, function. Digital delivery is not going away – figuring out a way to play in that space is important for replicators.
www.audiblemagic.com