Sustainable Content: A Conversation w/ Sam Valenti IV (Ghostly) on Drip.fm’s New Model for Digital Music Distribution

Dubspot blogger Rachel Dixon speaks with Sam Valenti IV, of Ghostly International and Drip.fm, about the future of music distribution services and what Drip.fm hopes to accomplish with subscription-based sound delivery. 

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Sam Valenti is the founder of Ghostly International and the co-founder (with Miguel Senquiz) of Drip.fm, a subscription based fan club service that provides music fans a direct line to labels and artists. I sat with Sam to pick his brain about Drip, and what we can expect from the future of music content delivery.

Can you give me a brief overview of Drip.fm and what you want it to do?

I was coming from Ghostly, from a record label background, where we’re always trying to come up with better platforms to help get our music and content to fans. There are lots of fantastic ways now, but more direct is always nice, where people can have a relationship that is sustainable and consistent. A lot of fans are asking, “why can’t I just give you my credit card, and you can send me stuff?”

Music is kind of funny. We spend all of this time talking about records. We tell the fans: we’ll have a new record out in 3 months. And then: We’ll have a record out in 2 months…and then it’s out. So there’s a bit of an inefficiency there. If I’m a fan of something, just send it to me; don’t make me work for it.

But really the bigger desire is between artists and fans, as their relationship is a lot closer now with social media. We wanted a better platform to connect creators and their fans, as well as creating a financial relationship that benefits artists.

Can you tell me a bit about the bigger name labels that are involved?

Sure, it’s pretty diverse. We’ve tried to curate a small but diverse group of labels. As far as the name brands, there’s Ninja Tune, a really reputable and amazing 20-year-old label. We have, similarly, some labels who are five years old or younger that are really interesting like Mad Decent, Fool’s Gold, or OWSLA, which is Skrillex’s label. There’s a lot of really interesting world music as well, like Luaka Bop, and I feel like Ubiquity and Om have a really good handle on their local sounds. Then there’s Cantaloupe out of New York, who do classical and experimental music. The platform is agnostic. We started with the labels that we were friends with, like Stone’s Throw, but we wanted to be open to all kinds of music.

Would you say that you’ve been expanding who the Drip.fm user is? Did it originally start as Ghostly fans and then expand?

For the Ghostly service, yes–obviously DJs and collectors and audiophiles, they’re a big part of our community. But we were also curious to see how Secretly Canadian and Domino, the more indie rock labels, would be a slightly different use case. We’re still learning what makes sense–things like giveaways for tickets and limited vinyl pressings. Some labels are really utilizing things like that. It really depends on their audience. What’s cool about Drip is that it doesn’t really have a culture where everyone is doing the same thing. The experience on Mad Decent’s Drip is very different from Ghostly’s. And that’s good. Those are different cultures. We want their culture to be up front and center, and the dialogue around it will be ultimately curating that culture. The goal is to not triangulate a certain behavior and then force everybody to attack it that way; I think the goal is to allow the culture of the artist or label be the dominant energy.

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Can you explain a bit more about the benefit to labels using Drip as a platform? How do they define their culture exactly?

A funny example would be Mad Decent, who made laminated cards for their fans, like a membership card, which is like a throwback to the “fan club.” It says: if you’re in for six months, you get access to the secret handshake. If you’re in for something like 7 years, you get some of Diplo’s ashes, which we can’t guarantee. But the idea is that there’s a certain humor there. And then there’s the dialogue around each release. They actually debuted “Harlem Shake” on their Drip, and fans would comment on that, like “Hey, this is really good, I want the vinyl,” or “I want the stems for this so I can remix it,” or “I’d love to see this show.”

Someone asked about going to see Austra, who is on the Domino Drip, and they helped that person get tickets. So it’s kind of like a concierge in a way; it’s the only real direct line to a label. I mean, you could send a Facebook message, which is not always that effective. The goal is to feel like you’re in a room with the people themselves.

Over at the Ghostly Drip, Molly [Smith, Assistant Label Manager] is giving away guest lists to shows. If people have questions or if people ask “hey can you unlock this cool release for me,” she is going to prioritize them. I think it comes down to the label and how they want to treat their fans. But at least there is a comfortable level of back and forth that can happen here.

What was the original motivation to embrace this type of model?

The idea that “if you know what I like, don’t make me work for it.” And then the degree of connection or proximity, meaning: if I’m really into something, I want more than just what the average fan gets. We were looking at the a la carte models, like iTunes and whatnot–and they’re great–but we come from a record store culture, where you go into a place and there would be someone who could say, “You bought this record last week. I think you’d really like this artist–try this out.” We want to get back to that curatorial feeling, but not algorithmically.

We did an experiment for Ghostly a couple years ago called Ghostly Discovery, which was an app. Jeremy [Peters, Director, Ghostly Songs], tagged every song in the catalog using color theory. You could tell the app how you felt about music. The idea was to get away from music at the level of “I already know so much about music,” and get away from algorithms. We’re not totally sold that social music is best served at that level. There’s always going to be a human element. Because connection to music is not just genre, it’s not just where it sits in a record store. There’s a certain intangibility.

With Drip, in this current iteration, the label is the curator. We think that this is what they live and breathe. They do this everyday. They are putting together a body of music, and we’re giving them the ability to curate to their fans directly. Maybe I’m a fan of Duck Sauce and I don’t know anything else on Fool’s Gold, but if I get into the Fool’s Gold system, I’m discovering other music from the same family. Record labels are like cottage industries, you know. They’re groups of friends. So I think you’re trying to explore music of one kind through relevant sources.

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Can we talk about the benefit to the users? What is the pricing structure like? Is it one subscription rate per label?

It’s one per label, and it’s averaged at around 11 bucks. Ten bucks is the cheapest right now, and it goes up to 15. It’s a monthly fee. We’ll probably unveil some other pricing options in the near future, but we wanted to start with a pretty controlled experiment. The response has been really good: people stay in the system, labels are able to provide enough content, for the most part, to make it interesting– including back catalog and things like that. Labels are digging into their vaults, or doing remix contests where the stems are only available on Drip. So right now it’s pretty standardized, but I think we’re going to have some different types of Drips coming out in the next few months.

What would you say is the advantage of using Drip as a platform rather than streaming services like Spotify or Pandora?

I don’t look at them as totally related. I mean, yes, music is music–but in our office we’re going to use YouTube, SoundCloud, and iTunes, and Drip. I was listening to Spotify earlier today. We use iTunes to listen to demos, I listened to Drip because we uploaded something I wanted to hear. I think it’s not going to be one solution. If you want a celestial jukebox that has every song in the world, Rdio and Spotify are amazing. Our value is in depth and curation. If I know I like a certain artist and I want to get more from them, or I just don’t have time to bother with researching this certain thing.

The analogy we like to use is omakase, like with sushi? It’s chef’s choice. You’re entrusting a trusted source to do the choosing for you. I think that we have a slightly different, and complimentary mentality to what’s available.

What has the response been from artists? Have they been psyched to interact more with fans?

We’re actually looking into working with more artists directly; right now it’s more through the labels. There’s a couple artists on Domino who have reached out, and were very complimentary because they were getting more money from Drip then they were from other services. Even though Drip isn’t a massive service, the per-customer value is way higher than a lot of the other services you mentioned. So I think they saw it as a chance to have a decent royalty rate and, if they so desired, have a dialogue [with fans]. Diplo has really been appreciative of it, and so has Skrillex–they’ve both done Ustreams and live chats on Drip. So I see it more as a kind of fan club or retention tool.

You are always going to need your iTunes and these things, but you don’t really own the fan relationship with those. As a user, I’m just interfacing with the Apple store, and it’s a big front-end with a lot of content, but I’m not actually talking to the artist, and I’m not paying the artist directly. As we explore more artists, we’ll have more and more opportunities for them to benefit from Drip directly. And the goal is to make as much money for artists as possible, or whatever it is they want to get out of their Drip.

Big philosophical question: What do you think the future of music delivery is? And what would you like it to be?

I think it’s a lot of things, as I mentioned. Maybe I don’t have just one service. Maybe I’m checking SoundCloud to check out unreleased artists, and I’m using Drip to follow my favorite artists and get music from them, or I’m using Rdio or Spotify for low-risk discovery when someone’s like, “Hey, check out this artist.” A healthy ecosystem is a lot of things.

The record industry isn’t going to be getting any easier. We’re in a renaissance, and in the next five years we’re going to figure out a lot of the problems that have plagued it, but it’s going to require some really good thinkers. So I don’t have a great one liner, unfortunately. Future music delivery is a lot of things, but sustainability is really important to us–not just crossing your fingers and hoping that enough streams will equal a dollar, but finding what actually translates into income for creators.

Has there been anything surprising in your beta release? Any user behavior that surprised you?

We found a certain loyalty. When people are paying for something, and are part of a club, there’s a trust built because they are opting-in instead of being treated like a criminal. We fought the labels a bit–we didn’t want to do DRM, there’s no rights-management or fingerprinting on the files. We just felt that was a little bit old hat. But Dirtybird was releasing music early, and one of the songs leaked to a torrent site, and they asked us what they should do about it. We said: “Why don’t you post a Member Update, and say ‘Hey, can you guys respect the membership and try to keep this together?’” So they put the flare up, and someone commented “Yeah, I’m really sorry, I put that up, I won’t do it again.” And there were about 42 comments from all of the fans saying, “Hey don’t ruin this!”

You didn’t have to fingerprint the files. I mean, it got out, but the value of the digital file isn’t in the file. It’s in the context. It was given to you by a label as an early gift. You can reinstate a respect for content if you treat the consumer like a peer as opposed to trying to safeguard everything. I think that was surprising. It was nice to see that people wanted to keep a place of sanctity around the creator and around the art. The fact that people subscribe when you can get music for free is validation. We have a good product, we’re trying to make it great, and we have a lot more research to do.

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