Rob Reid is a L.A.-based author and entrepreneur, and the founder of Listen.com/Rhapsody, the first online music service to get full-catalog licenses from all the major music labels and one of the top online music services, with over a million paying subscribers. He got his start in music growing up as an avid guitarist and songwriter, eventually choosing to focus on business when he attended Harvard Business School and wrote his first book, a first-person account of what it was like to be a student at that particular business school, which was published by William Morrow & Co. After business school, he got involved in the Internet as it was just beginning in the mid-‘90s, initially working at Silicon Graphics, a company that made graphics workstations, supercomputers and web servers. While there, he wrote his second book, Architects of the Web, in 1996, which chronicled the rise of the Internet as a commercial medium. Eventually, Rob decided to start Listen.com, which he grew from a barely-funded startup with just a handful of employees, into the now-renowned Rhapsody music service. At the 2012 TED conference, he presented his now infamous “Copyright Math” theory, the term he uses to explain the often confusing and intangible numbers cited by the two major organizations within the entertainment industry – the Motion Picture Association of America (MPAA) and the Recording Industry Association of America (RIAA) – in an effort to get others to rally against piracy. He has written pieces and features for various magazines and websites, including Wired and The Wall Street Journal. His first novel, Year Zero, is closely tied to the “Copyright Math” theory and releases on July 10 via Random House/Del Rey. It is a comedic science fiction story set mainly in present-day New York City about a society of highly-advanced aliens who are so enamored of American pop music that they accidentally commit the biggest copyright infraction of all time, thereby bankrupting the entire universe.
Rob was kind enough to chat with me about his background in the technology/Internet and music space, his book Year Zero, and how writers, artists, musicians and other creatives can best connect and share their work in a world where the distance between creators and their audience continues to decrease.
Thanks so much for taking the time to talk to me, Rob. How did you get into the music, technology and publishing business?
I was a fairly committed guitarist and songwriter with a 4-track. But I never went the band route. I decided pretty early on that if I was going to be a creative person, my strengths lay more in writing. It took me a long time to actually get around to doing that.
I got out of college and did a somewhat weird thing: I went to Cairo on a Fulbright Fellowship. I lived there for a year and went to school on the then obscure and now very famous Tahrir Square way back in the day. I came back and got involved in business by going to Harvard Business School. I was a pretty serious writer throughout the very business-oriented first part of my career. I wrote my first book while I was Harvard – a first-person account of what it’s like to be a student at there, which was published by William Morrow.
When I came out, I went into the tech industry and became an Internet full timer very early. It was 1994, and I came back out to California, where I had originally gone to college, though I grew up in Connecticut. Because, I really liked the Bay Area.
I thought I was progressive for having an AOL account in 1995.
You were. I came to work at a company called Silicon Graphics, which was great at the time and pretty much at its apogee, and now is pretty mourned – may it rest in peace. We made graphics workstations and supercomputers and web servers in the very early times of the Internet. Our founder, a guy named Jim Clark, took off to start Netscape, which was the first true Internet company, in my opinion. I came over to Silicon Graphics because it was the big, sexy company. All the graphics supercomputers we made were dominating post-production studios in Hollywood and at game studios at that time. It was a great place to be, because there was such a talented crew there in the mid ‘90s. It has become an alumni network in and of itself. My Silicon Graphics alumni network matters even more to me than my Harvard Business School network.
That’s one of the interesting things that people sometimes don’t realize about picking the company they’re going to go to; that’s going to be your network.
I think that’s a good lesson even outside the corporate world.
Always be on your best behavior, because it’s a small world, and your reputation will precede you. The people you hang out with for two or three years doing anything are going to be the experts on you in the future. And you want them to say good things about you.
So, I was at Silicon Graphics for a while. I ended up becoming the business development interface between Silicon Graphics and Netscape, which hauled me into the Internet somewhat inadvertently at a very early moment. After working for about a year and a half, being a writer at heart, I took some time off and wrote a book about the rise of the Internet entitled Architects of the Web.
This is actually good advice for anybody: If you want to really wrap your head around something that’s going on in society and also get to know everyone who is doing anything within it, a very good way to do it is to write a book about it. Even people who are too busy to talk to journalists will usually take the time to talk to an author, because authors don’t call them that frequently, whereas journalists call them all the time. And the act of stating to yourself and the world, “I am going to write a 400+ page tome about an interesting phenomenon” is a terrifying proposition that really forces you to crystallize your thinking, because of the acute risk of enormous public embarrassment. I think to a lesser degree, it’s true of any kind of writing – blogging, writing articles for magazines and websites. But the book puts you in an ivory tower for eight or nine months, because it’s all you do for a very long period of time. It’s a license to meet lots and lots of people.
I got to know everyone who was doing anything remotely interesting on the Internet in 1996, which was a great year.
That’s really why I have a blog, by the way, though it’s not the same thing as a book. It’s to be able to have that conversation.
Yes. It’s that same idea. You get to reach out and talk to people. The book is a monster dose of that. But I think it’s entirely true of blogging, writing any kind of articles. It’s a license to talk to interesting people, pick their brains and think about what they have to say. Then, as you find with your blog, when you’re going to put that out there into the world, it really forces you to make your thinking rigorous, because you’re going to put it into concise paragraphs as opposed to chatting about it over beers, which is what we usually do when we expound upon ideas that are important to us; it’s usually casual and off the record.
So, the book about the rise of the Internet was my second book. And at that point, I accidentally became one of maybe 10 MBAs in the world who could say they had worked for two years with the Internet. Because of that, I was able to leverage my way into a job in venture capital. Through that work, I saw into the capital-formation process and a lot of great entrepreneurs upfront and got the idea that I’d rather start a company than be a junior investor. So, I started Listen.com, which became the Rhapsody music service. That began a very, very busy seven years of building that from a PowerPoint presentation, to a barely-funded startup with a handful of people, to what it became.
So, I got Listen.com funded, ran it for a few years and then found someone who was better at running it than I was and acted as Executive Chairman for a few years. We eventually sold it to RealNetworks, and they grew Rhapsody much bigger than we could because of their resources. MTV bought half of it, and that helped it grow a great deal more. Now Rhapsody is of course off in the world and doing wonderful things. I left RealNetworks about a year-and-a-half after I sold Rhapsody.
After that, I did a bunch of different things. I started an online video company that did pretty well, but I just couldn’t figure out how to make it grow. It had the opposite problem that most of your traditional startups have, because it was actually profitable. But I couldn’t figure out how to make it a much bigger company than it was. My wife, Morgan Webb is a bit of a celebrity, and we created a video blog. She talked about what was going on in the tech world that day. She hosts a TV show called X-Play, which covers the world of video games and video gaming. We did really well with that little tech video blog, because even in 2007 or so, it was really early for that.
But it was a little too early, because there weren’t a lot of people watching episodic video online at that point. While we could grow that and do well with advertisers by working with a company called Federated Media that does great online ad sales, we couldn’t really figure out a way to launch the next seven shows. We had an audience for our show, because Morgan has an audience. But to do the next six shows, we would have to hire hosts of her stature – which we really wouldn’t be able to afford – or launch it with folks that didn’t have much stature, which would leave us with 400-500 viewers per episode. And we couldn’t monetize that. From my standpoint as a startup guy, I realized this was just going to be a small company forever. And from Morgan’s standpoint as somebody who had and has a national daily television show, it didn’t seem like the best thing she could be doing with her scant free hours. We did the video blog for about a year and then shut it down.
Not long after that, I started writing this book, Year Zero, which is being published by Random House. It’s releasing on July 10 and is deeply connected to the TED talk. It’s my first novel. I’m sure that a lot of the artists in your readership know very acutely – and you do yourself as well – what it’s like to be nursing a creative urge over a period of years. In my case, that creative urge lay fallow for quite a few years, because I was busy running Listen.com, doing all that Internet stuff and writing two non-fiction books, which both had major publishers and were pretty well received. Architects of the Web was published by John Wiley and Sons, Ltd. But I’d always wanted to write fiction.
Morgan and I were traveling in Colombia at one point, and she got a little sick towards the end of the trip, so we were lurking around the hotel for a few days. I started writing this story to entertain her. The story was about a vast universe-spanning civilization of highly-advanced aliens who are so into American pop music that they accidentally commit the biggest copyright infraction of all time, thereby bankrupting the entire universe. All the wealth in the universe is now owed to our rapacious record labels, and we human beings don’t know it just yet.
I love that.
As you can probably tell, it’s absolutely a comedic story. I just kind of got inspired and spent 18 months writing this thing, in kind of the same way people spend 18 months putting together an album even though there may never be any prospect of it getting out there. To make a very long story short, it’s going to be coming out on Del Rey, which is the biggest sci-fi imprint of Random House. Year Zero is going to be Del Rey/Random House’s lead science fiction title for the summer.
And yet, you emailed my 15,000-20,000-monthly-unique-visitors website to promote it yourself. I think that’s brilliant.
Well, and that’s what we need to do. This goes right into the advice I would give to anybody who is in your audience, particularly on the artist side. I think this practice is essential and very few people bother to do it. And 15,000 is a hell of a lot more Twitter or Facebook followers than I have. Hopefully a lot of people will read my book. But I’m in a phase right now where the publication date is coming up, and I’m very attuned to the media that’s out there that’s engaged and interested in issues of music, copyright and intellectual property. Because, those are significant themes in the book. So, I’m really trying to engage in “retail politics” and meet a lot of people who are talking about and responding to my TED talk and other things I’ve been doing. I think that’s what we need to do today as creative people.
Back in the day, there was so much friction that stood between artists – whether they were musicians, authors or anyone who performs as a comedian or an actor – and their audience, that these very large-scale operations with the muscle to pierce through the friction of the physical world became intermediaries between us and our audiences. What ended up happening is that a lot of people ended up misperceiving what was going on in the world as being a statement of the nature of artists and their relationship with their audience, and the nature of public tastes.
I’ll give you an extreme example: The media channel was once very constrained. And when I talk about the physical media channel, I don’t just mean rolling trucks, etc., although that is a part of it. I’m also talking about shelf space, which was once very tight. There were people who were very good at distribution and could pierce through the market and put your work – whether it’s a vinyl record or a book – on a narrow shelf in front of a lot of people. There’s enormous power in that. In music, I would say that the “shelf” wasn’t just referring to the shelf space at the mom and pop store, Sam Goody or Walmart ,etc. – although that was important …
Yes. Price and positioning was critical. There was a whole science to what endcap you could buy and discounted pricing, etc.
Oh, it was immense. And it was bad enough if you were a tiny, independent label or publisher. But if you were a tiny, independent artist, good luck getting on 15,000 shelves from Seattle to Miami. The infrastructure and cost would elude you. But the other piece of shelf space – equally important – in music that we don’t have in writing was the terrestrial broadcast “shelf” space. Again, let’s go back to the ‘50s-‘90s, and to a lesser extent, the present day. There are only so many music radio stations in Milwaukee. And there are only so many hours in the day. With payola and independent promotion, it became a game of scale to access that very narrow “shelf” – the de facto “shelf” of time and broadcast slots.
The extreme example for me is if we go back into the early ‘60s, when there were three channels that the entire nation watched. Being on The Ed Sullivan Show was a hell of a way to launch a band. The Beatles achieved a level of cultural homogeny that will never be paralleled. And it’s partially because they were magnificent in absolutely every regard. (I’m as much of a Beatles fanatic as any true music fan out there.) But also, you just had every teenage set of eyes in the country watching one of three channels. And at that moment, they were just watching that one, because at that point, the shows on the other two channels sucked. Piercing through that physical channel created hits. That was just what you needed to do.
If you could get a major book publisher like I’ve done, or if you could get a major label like the Beatles did and get that muscle behind you to pierce through that very, very congested, friction-filled and expensive channel, you would then be in front of a very large group of people with a relatively small list of competitors. I grew up on the East Coast, so this meant you’d be at Caldor with one of a few hundred records that were available to kids who would get on their bicycles and ride out to Norwalk and look at them. Not every record got to be Dark Side of the Moon, which spent hundreds and hundreds of weeks in the Top 200. But it was a hell of a lot easier to get to that level when there was just a small amount of stuff that pierced through.
We’re in a very different world today. I think the most powerful currency that any artist has – particularly smaller, newer and more independent ones – is the number of direct relationships that we have with our audience, with the people that listen to or read our stuff. We need to do anything we can do in a block-and-tackle manner to get our name, our Twitter handle and our Facebook page name out there, or sample chapters or mp3 singles out there to start building that base of people we can reach – whether through Twitter, Facebook, or through any other method. (I think that Twitter is overrated and Facebook pages are underrated, but that’s a personal bias.)
But building that pipeline is potentially the greatest asset that any of us will have. And it is a career-long project – day after day, week after week, month after month. You need to put enough out there to generate interest and participate enough in that sphere that you get dozens, hundreds and thousands of followers, fans, listeners or readers. If you build that over a period of years and let that growth compound, at some point you don’t need an intermediary to reach your audience anymore. I think it will be more powerful in publishing in some ways, because relatively speaking, it’s so much less of a team project to write a novel than it is to make an album. The role and the need for groups of people to assemble around a band to make it successful is much greater than the need for a group of people to assemble around an author. But building that channel in the manner I just outlined in the creative world is absolutely essential right now.
You can learn more about Rob Reid and his work on the official Rob Reid website and follow him on Twitter and Facebook. Year Zero comes out on Tuesday, July 10 and is currently available for pre-order on Amazon, Barnes and Noble, and IndieBound. (The audio version is read by John Hodgman!) You can read the first chapter of the book here, or check out the trailer. Also stay tuned for Part II of this interview, which will release next week.