‘The industry has learned its lesson.’

Rob Wells

Paul the Apostle had the road to Damascus, Rob Wells had the train to South East London.

It was a short train ride from Charing Cross Station back south of the river, but it was long enough for Wells – armed with a copy of the then-recently launched internet magazine .net, given to him by his boss, BMG Head of Direct Marketing Tom Curran – to see the light.

“This magazine was talking about what the internet meant for content and how music, TV, software and games were going to be consumed,” Wells reminisces. “I remember thinking, This is going to completely revolutionise everything, from storage to the attachment to a physical product. It was a real lightbulb moment.”

Given that this was the mid-1990s, it would be a while before a Philips 100-watter appeared above the heads of most other execs in the music industry. But that journey set Wells on the path to become perhaps the music industry’s leading digital evangelist; the missionary who would convince the biz’s biggest players that Spotify and other streaming services should be encouraged rather than feared.

Wells had joined BMG in 1994, after he returned home from a three-month surfing trip around Europe. As he parked his camper van on his parents’ drive, the phone was ringing – and on the other end was a music biz mate who told him the label needed “somebody who’s tall and can lift heavy boxes”.

“I was like, ‘OK, I’m qualified for at least one of those two things!’” laughs Wells. He’s been doing the industry’s heavy lifting ever since.

At BMG, he set up a (then) ground-breaking e-mail database for clients such as Take That that drove unprecedented levels of sales and engagement. He adopted all the possibilities of the worldwide web, winning numerous digital awards along the way. 

But, in a still heavily physical business, Wells was always the last speaker in the marketing meeting (“No one really cared – it was really funny,” he laughs). So, when David Joseph gave him a call, he headed for Universal UK to run its ‘new media and digital services’ unit in 2000.

“I left two weeks before BMG acquired Napster and everyone was like, ‘Oh, did you leave because of the acquisition?’” he laughs. “And I was like, ‘Yeah, I left in disgust!’ But I had no idea it was coming, I left because I got a better job!”

At Universal, Wells became the industry’s digital savant, moving up to run UMGI’s digital operation and then heading for Los Angeles as President of UMG’s Global Digital Business. There, he and Sir Lucian Grainge reshaped the company’s strategy, going all-in on streaming and, ultimately, sealing UMG’s market dominance.

So, it was a big surprise when Wells left suddenly in 2015, although he has only good things to say about his UMG days (“Lucian runs an amazing regime. The whole thing was executed brilliantly and the timing was great”).

Many expected him to turn up in another top music job, but instead he helped  various start-ups before becoming Chief Commercial Officer and CEO of the Americas for CrowdMix, a social app for music fans that collapsed spectacularly in 2016 after burning through £14m of investment without ever actually launching.

Today, speaking to MBW from his Malibu beachfront office, Wells describes that experience as “a well-documented trainwreck”, but it didn’t put him off start-up life. Since 2018, he’s been CEO of Orfium, a global rights management technology business that aims to solve the industry’s royalty collection issues. The company says it has already delivered hundreds of millions of extra dollars to creatives and rights-holders through AI-driven techniques for matching catalogues and resolving asset conflicts. 

Orfium’s clients include major and independent publishers and record labels, plus broadcasters and collection societies. It recently did a deal with PRS for Music to extend the society’s music licensing into Africa, and Wells hopes Orfium will ultimately become to music what Plaid is to banking: a data transfer network that powers an entire sector.

In the meantime, Wells continues to enjoy the California lifestyle – although he complains that, these days, he spends more time observing the breaks from his office window than he does surfing them. 

He’s kept the South London accent (“People give you a wide berth in the surf, because you sound like a Hollywood villain,” he chuckles) and the love of digital innovation (he’s convinced AI is “a Spotify moment” for the biz, rather than a Napster one), although he does admit to despairing at one of his son’s teenage friends who “sees himself as an artist, but all he does is take records, speed them up and release them on YouTube”.

These days, of course, Wells is largely preaching to the converted when he urges the music industry to embrace new technology. But, as he settles down to talk MBW through his journey since the train ride that changed everything, there are still plenty of revelations…

Were you ever frustrated by how slow the music industry was to embrace digital?

When I was running the UK digital thing [at Universal], all the litigation that was happening in the US was quite disappointing. I’ve always been a commercial entrepreneur-in-residence and it was all done wrong. 

But I don’t honestly think they had a choice. There are echoes of that in the whole AI thing that’s kicked off in the last six months, but I think the industry has learned its lesson. The news about Universal doing a deal with Endel means I don’t think we’re going to go down that dark path again; they’re a lot more embracing of new tech.

When did attitudes change?

When I got the international gig in 2005, things were pretty bad. Financially, the industry was contracting because of piracy and it was like, ‘Let’s license our way out of this hole. We have to be a lot more liberal with how we grant licences to services’. If we hadn’t done that, we wouldn’t have learned the basis of the Spotify deal. 

That wasn’t the first deal we did at Universal on a full streaming, all-you-can-eat consumption model; we did other deals internationally before that. We’d licensed pirate services in various far-flung corners of the world, we’d done a deal with Baidu in China and Soribada in Korea. None of those deals were commercially game-changing, they weren’t changing the course of the industry from a revenue perspective. But the information, the data, the behavioural analysis that we pulled out of those deals was the formulation of understanding what consumers do when they’re faced with everything for a fixed price. 

And what did they do?

When the Nokia Comes With Music deal went live, we really got a bead on what it means when a consumer has access to everything. And it was completely unthreatening. Everyone thought they were going to download thousands of tracks, get whole catalogues and listen non-stop, but that’s not how it works. And that empowered us when Daniel [Ek] came in to see us. We weren’t petrified by a model like Spotify so it was like, ‘Let’s make it work financially’ and we ended up doing a deal.

Even then though, the US business, in particular, was unconvinced…

There are a few label bosses that remind me I told them at the time it was going to change their lives! They were like, ‘Idiot Englishman doesn’t know what the fuck he’s talking about!’ For our American colleagues back then it was all a bit, ‘Not invented here’. It wasn’t an American service so it was never going to change the way Americans consumed music.

So what made you believe in Spotify when so many people didn’t?

Well, the alternative was dark. It was going to be next to impossible to get people off pirate services without catering for why consumers were on those pirate services in the first place. And it wasn’t just because it was free, it was because there was everything here, they had great search mechanics, it was convenient… I was on a panel with some movie industry people and I remember saying, ‘You punish your legitimate consumers’. 

Back then, you were forced to watch all the trailers the studio wanted you to watch and an anti-piracy message from FACT. I was saying, ‘You guys are mad, you’re disadvantaging legitimate consumers – it’s a better experience to go and steal it’. It was like I’d pulled the pin out of a grenade and rolled it across the stage – ‘What have you said, you heretic?’ But Spotify provided that legitimate alternative to piracy. Everything they did with the product was amazing, it was push, play, hear music. And that resonated with me – you have to think consumer first.

Would the industry have recovered if Spotify hadn’t made it?

Something else might have come along. It was just the timing. There are TED talks on what makes platforms succeed or fail – and timing is the single most important element. And Daniel’s timing was good: the market was as busted as was, we’d been doing the experiments in various corners of the world. 

There were other competitors. Rdio was by far the most social platform, it was much better for communication through fanbases, but it’s like Betamax vs VHS. It’s not always the best platform that survives.

So why did you leave just as the problem was fixed?

[Laughs] Yeah, talk about timing! I’d done 22 years in corporate life, so I drew a line under that chapter. It was an amazing ride and I loved my time at Universal, I met so many good people that taught me about the music industry and how it works alongside unique cultures, which is vital when you’re looking to do business in places like Japan, Korea, China or India. 

The new industry is way more global than when I first started. But I wanted to do other things. I stepped off that corporate carousel and moved into early-stage technology ventures –and that was a decision I came to regret! 

Crowdmix must have been a bruising experience, especially as you were its best-known executive…

Yeah, it was definitely reputational harm. But if you go into these early-stage ventures, you don’t have that comfort blanket of corporate life; it’s a life experience. The company failed, people lost a lot of money and it was a tragedy.

“Early stage ventures don’t have the comfort blanket of corporate life.”

We tried really hard to make it work. But from an experience perspective, it was massively valuable for me. I learned more in that 18 months than I did in the prior five years. You don’t learn lessons about investors, quality of investment and product and engineering resource in corporate life. 

To have the first thing I do after corporate life fail so spectacularly and so publicly… I wore the grass out in my garden because I was walking around in a circle, talking to investors and potential acquirers for about three days. It was horrific.

When you joined Crowdmix, your press statement said you’d been ‘initially sceptical’ about the move…

I should have listened to my gut! I guess the question is, ‘If you could go back and do it again, would you?’ And I’d say yes, I would. I’d do some different things internally. The concept was strong but, from being involved with the Orfium business, [I know that] if you’re in a fast-moving tech environment, product market fit is absolutely critical. And we missed that with Crowdmix, but it was a great concept. Some of the brands we spoke to were head-over-heels with the idea.

After that, most people would have run a mile from any new tech business. So what persuaded you to join Orfium?

The two guys I’m in business with [co-founders Drew Delis and Chris Mohoney], we share a common sensibility in terms of the value of the creative community – songwriters and artists. Everything we do is about empowering speed of revenue [payments], tracking royalties or matching data. 

Our client base are rights owners, societies, broadcasters or production houses, but everything we do empowers those constituents to pay through more money, more transparently. That was the main draw. We’ve shown that there is more value to come out of DSPs. It wasn’t that long ago when YouTube was the enemy of the music industry. Now, you look at how established Content ID is and how well they pay the creative community; YouTube has become a titan and it’s the poster child when you’re looking at platforms like TikTok or Meta. Do what they’re doing, pay how they’re paying.

You’re partners with collection societies, but some of this sounds like it might be competition for them as well…

[Laughs] It’s a good question, but no! We are definitely not competing with collecting societies, they are well-established. And understand as well that, there are a bunch of markets on the planet that don’t even have collecting societies, but music is still being used. There is a lot of value that can be added by putting a tech layer across a market like Africa or Southeast Asia.

If you could change one thing about today’s music industry, what would it be?

I’d change the attention span of consumers. What concerns me is, consumers have got fickle. There’s always been massive competition between music, gaming, sport and everything else, but the attention span of the youth now doesn’t lend itself to learning how to play instruments. 

What is being signed today that, in 15 years, will be the crown jewels of a major’s catalogue?”

The industry has a fundamental grassroots problem. Ask any 13-year-old what they want to do when they grow up, they’ll all say they want to be a YouTuber or a gamer, because it’s immediate. There needs to be a programme built around getting musical instruments into the hands of kids. 

When I was growing up, I aspired to be the rock stars of the day, now it’s all completely changed. And it’s manifesting in how people consume music, especially the youth – it’s mainly older catalogue that’s sped up. How do you do artist development in a world where consumers are watching 15-second videos? What is being signed today that, in 15 years, will be the crown jewels of a major label catalogue?

Would you ever come back to the record industry?

Maybe, who knows? At the moment, I’m happy staring at the surf that I can’t actually paddle out in, and working 15-hour days! But never say never…

This article originally appeared in the latest (Q2 2023) issue of MBW’s premium quarterly publication, Music Business UK, which is out now.

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