BC Business
Terry McBride, founder and CEO of Nettwerk Music Group, has been making waves in Canada’s music industry for over two decades, bucking the norm from the beginning by refusing to sign artists who didn’t write and perform their own music.
Terry McBride has been making waves in Canada’s music industry for over two decades, bucking the norm from the beginning by refusing to sign artists who didn’t write and perform their own music and today, suggesting consumers pay a monthly bill for their music just like they do for TV or hydro. The 100-employee Nettwerk Music Group, of which McBride, 45, owns 20 per cent, has several revenue streams, offices in London, L.A., Nashville, Boston and New York and represents the likes of Sarah McLachlan, Avril Lavigne and the Barenaked Ladies. In November, Nettwerk entered into two agreements with Sony Music Canada. First, Sony becomes its exclusive distributor in Canada. Second, and more importantly, Nettwerk managers will scout acts for Sony (not known to turn its nose up at artists who don’t pen their own tunes). You’re now one of Sony’s key talent scouts. What makes you guys the experts?
Most record labels, including Sony, have A&R (artist and repertoire) arms in the major city of most countries and in the case of Canada, that’s Toronto. But if you look at it, probably 99 per cent of internationally successful artists are from outside Toronto, and for the most part, Ontario. We have 18 artist managers who travel around the world with their artists, so we’re really in tune with what’s happening, what fans want, and we’re constantly being hit with promoters or agents to put new bands on, and being given CDs by young artists wanting management.
So you have a lot of exposure to new talent.
Yes. But Nettwerk has a very distinct taste. A Canadian Idol thing doesn’t interest us. If you’re just a performer, you don’t have the other two parts we believe lead to successful artist careers. Yet we see them constantly. Over the years we knew right away some would end up selling millions of records, but they didn’t fit what we do so we walked away. Now, we’ll pass on the referral to Sony. If they sign it, we get a back-end commission. A star is a star and if you know what you’re doing, you know them when you see them.
Why didn’t it happen sooner?
Some things are so obvious you don’t think of them.
Any talk of a merger?
I have no desire to sell my company.
How unique is it for managers to insist on their artists writing their own music? Very unusual, for a management company our size. Half the music sold would not fit with us – probably 90 per cent of country music is not performed by the person who wrote it.
Why is that important?
The most powerful message in music comes from someone who writes a song and is able to perform it because then the fan buys into it – they know it’s the real deal. The performance and the meaning are so much more connected.
You also bucked the norm years ago with your ‘micro-marketing’ strategy for musicians.
Niche branding is really what it was – we were just doing it before anybody else. What it really meant was taking a national marketing and promotional budget for a whole country and putting it into five or six cities, based on sales and radio data that paint a picture of where there are sparks you can turn into fire. Then you blow those markets up to a completely new level and move on to five more. Sarah was really the testing ground for that template. When we took on the Barenaked Ladies on their way down, we were able to use that method and completely flip things for them.
I’m not really hearing much about them these days.
They have a new album coming out in September. I don’t believe an artist should be hyped 24/7 because people get burned out. Sarah’s always there, but not in your face. Wouldn’t you like to have Britney Spears out of your face for a while? My rock stars are just people, not icons. I don’t want to manage celebrities.
The Internet and digital music is wreaking havoc on the music business. How do you see things shaking down?
I’m at odds with the rest of my industry. I believe music is a utility rather than a commodity. It should be no different than electricity or your phone bill. My view is a future where you can access whatever music you want, in any form, and just pay a fee of $6 or so attached to your phone bill every month. This would mean you could get anything you want, when you want and how you want it – on your cell phone, iPod, in your car, your home stereo – for a flat fee. This would turn things on their head. The industry is going there anyway.
How far away is it?
A couple of years. In Korea, digital music sales in the last quarter surpassed physical sales, and telecommunications companies are starting to sign artists. Probably 30 per cent of what we do now is digital, compared to maybe 10 per cent for the majors.
The biggest hurdle?
Dealing with all the different players in the business and trying to get their heads out of the sand. So many are stuck in the old way of doing things. They need to realize music is a utility – sell it and market it as such. Leave your egos at the door and start talking to the people who buy your music.