When we think of major corporate business deals and partnerships, we’re usually informed by way of cookie cutter headlines and lawyer-reviewed press releases. It’s easy to imagine a team of Ivy-diplomaed analysts, researchers, MBAs and lawyers crunching numbers, writing highly detailed reports, negotiating tic-for-tac fine print and tweaking language and legalities. We imagine a hard-set objective – a deal – consummated if and when a certain quantifiable threshold of benefit is met by both parties involved, as meticulously calculated by said teams of really really smart people. We imagine the corporations as machines, guided by an absolute, abstract logic dubbed “business strategy”. A quantifiable science.
It’s easy to forget that these machines are really a collection of human beings, like you and me. A major corporate deal, in its purest essence, is an agreement between two human beings. Two human beings with their own egos, interests, status, backgrounds, personalities, favorite desserts and pet peeves. A qualitative art.
Where do the lines cross?
I didn’t put Imeem on the top of my last entry on accident. I really do believe Imeem pulled the proverbial (obese) rabbit out the (miniature) hat in striking the ad-rev share deal with Warner Music. The practical implications might be small – users already stream music for free and social networking CPMs (ad rates) are low, so there isn’t going to be too much money exchanging hands here. But in philosophy, the deal was more than ground-breaking…. it was earth shattering. A major label agreeing to give away their catalogue in a progressive format (streaming) for a cut of ad-rev – that’s BIG, dagnamitt!!!
Unfortunately, the news didn’t make earth-shattering waves in the press, prompting me to write up that last entry — to do my part as a blog publishing worm. But more importantly, I was fascinated by Imeem’s own muted corporate communications. Surely, they must know they’re working on a revolutionary model of music distribution. Where are the banners, the chants, the army of yelling advocates? Well, besides me, at least.
Well kiddies, I got the answer right here. In an interview with Business 2.0’s editor at large, Erick Schonfeld, Imeem’s CEO Dalton Caldwell comes right out and blatantly dead pans the essence of Imeem’s, well, essence… as distinguished from a “download paradigm”:
“It is more like a subscription model where the subscription is being paid for by advertising.”
Now if you’ve read my last two entries, that’s hardly a revelatory statement – way to state the obvious, right? Where’s the nyuh-nyuh-nyuh, I-told-you-so, consumer-revolution advocacy? In the same interview, Caldwell breaks out this little gem of zen psychology:
“If you create an adversarial relationship with the labels, you are screwed. If they want you to succeed, you will have a much easier time.”
Now before you suited sharks mock this approach with your sarcastic Kum-bah-yahs, remember that it was Caldwell’s Imeem that overturned an adversarial Warner Music lawsuit into a groundbreaking rev-share deal. A potential dagger turned goldmine.
The reason I find this little throwaway piece of advice golden is because it’s so timeless. It speaks to the human condition, rather than any financial equation. It’s so easy to dismiss the old guard as aging, clumsy technophobes. It’s easy to preach the new media revolution, especially to an excitable consumer base eager for free access. It’s much harder to sit down with your enemies, treat them as the human beings that they are, and make them your strongest allies.
Indeed, Imeem went into it’s own self-imposed gag order just as soon as Warner brought it’s lawsuit. In light of Caldwell’s kum-bah-yah quote, it’s easy to see why: no way were they going to undermine their own survival (much less, vision) by talking smack and enabling that smack to smack them back at the negotiating table. I should be a rapper.
Revolution by way of roses?
Surveying other digital vs. traditional media battles, it doesn’t look like this particular kum-bah-yah approach is too popular amongst the new media kin.
Shoot Em Up Google
Viacom’s one Beeeeeellion dollar copyright infringement lawsuit (cue the Dr. Evil pinky) against Youtube and parent company Google has hardly inspired pleasantries between the two. Google’s CEO Eric Schmidt — who, by the way, reminds me of a slightly smoother, slightly more arrogant Bill Gates, right down to the Harry Potter frames — loves to take underhanded swipes at VIACOM’s sniveling overlords (my words, but his telepathic thoughts), famously dismissing VIACOM as a company “built on lawsuits, look at their history.” Schmidt even gets personal with it, adding, “Look who they hired as CEO, Philippe Dauman, who was the general counsel for Viacom for 20 years.” Oooh, burn.
And then there was Eric Schmidt’s keynote interview with Walt Mossberg at the D5 conference (video embedded above). Testing out the waters, Mossberg sympathized that Schmidt might be muzzled by his lawyers on the VIACOM topic, to which Schmidt replied “I could talk about it lots.” And lots he talked indeed, spinning the techarrazi in a tizzy with this choice soundbite: “The VIACOM lawsuit was probably just a mistake.” As if those silly VIACOM lawyers could possibly overlook the viability of a billion dollar lawsuit. But we get the undertones, Schmidty, we get it loud and clear. Some other choice quotes, with helpful translations:
“We’re busy building tools, that will do this (filter out copyrighted material) automatically, because it’s crazy for people to be doing this manually.”
Translation: VIACOM is the one that’s crazy for suggesting it.
“The important principle about copyright here, is that Google operates under the DMCA for lots of our properties. We happened to be sued by VIACOM over this particular issue. Which is largely a business negotiation, I think.”
Translation: VIACOM, are you serious?
“It’s also worth noting that the DMCA is U.S. only, and that the laws differ by country, and it’s a real problem to try to run a global site, as we are, because the laws are different, and you have to deal with each and every law.”
Translation: No, but seriously… serious?
“The law doesn’t require us to build these tools; we’re building these tools to make their lives easier, because we think that it’s good for everybody.”
Translation: We’re busy doing grown man work. We ain’t got time for VIACOM’s bitching.
And finally, Schmidt tries to play the above-it-all diplomat:
“There’s a line of advocacy that we probably should not cross as Google. Google tries very hard to be an independent and unaffiliated arbiter of what the best search results are. And there’s always this line we have to be very careful about.”
But without pause, Schmidt goes ahead and advocates his “personal views”:
“My own view is that the user content explosion is so profound, and so obviously a big phenomenon, that it will eventually cause the world to change.”
Leave it to the head of the most powerful tech company in the world to wave the advocacy flag. But still, it’s a declarative statement contextualized against the implied short-sightedness of VIACOM.
All these backhanded swipes while the two companies are allegedly still trying to work things out.
Something of a Conclusion:
The point of this post is not to downplay Schmidty’s tactics against the rosy philosophy of Imeem’s Caldwell. That’s like comparing under-ripe apples to planetary oranges. I myself was once something of a leftist firebrand in my college days and I’m now on the progressive side of the digital media front, so I thoroughly enjoy Schmidt’s cunning viciousness. It’s fun to see a man as powerful as Schmidt advocating the free access front (albeit with his own vested interest in mind), backed by the heavy legal and financial artillery of Google. It’s like watching some kind of nerdy web-tech action flick, where the nerds are equipped with lots of cool guns and the nerd leader equipped with lots of pithy quotables and comebacks. Or something like that.
Imeem, on the other hand, is just another startup operating on borrowed money (albeit, that sweet sweet Sequoia capital). Their corporate partnership strategy has to resemble more of an indie flick with lots of reality, relationships and character development. And so we see a script involving collaboration, persuasion and subtle psychology. And wouldn’t you know, Imeem’s Caldwell majored in psychology as an undergrad at Stanford. I’m not even sure how I know that, but yes, it scares me too.
Revolution by guns or roses? I guess it depends on whether you own a weapons warehouse or a greenhouse.
Perhaps the comparison is hardly comparable. Whatever. Kum-bah-yah, shoot em up, and I’m out. Peace.
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