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Joint Adventures

Last Thursday, Variety reported that Sony Music, the global music conglomerate (which made $7.2 billion in overall revenues during the 2018 fiscal year), has formed a joint venture with Adam Davidson, the New Yorker staff writer and co-founder of Planet Money, and Laura Mayer, the former executive producer at Stitcher.

The new entity, which has yet to be named, is structured as follows: Sony Music will own 50% while Mayer and Davidson each holds 25%, with the former taking responsibility of the various business aspects (marketing, sales, distribution, business development, and so on) and the latter duo solely focusing on the creative side. According to the Variety write-up, Sony Music is also investing an undisclosed sum.

One significant thing to keep in mind: “This is not a music content company,” Davidson emphasized, when I reached out for more information over email. “We are a podcast company.” That is, the new venture will focus on programming across a variety of genres, topics, and production types, and thus will not strictly take the form of a music podcast-centric operation. “I’m sure we’ll do some music shows, but that is not our focus,” he added.

I found this a little surprising, having originally assumed as such when I first spotted the news. After all, when you have a major music conglomerate making an investment into a space somewhat outside of its content expertise, one would assume that said label would in some way capitalize on the edge unique to itself — i.e. music licenses, activated music audiences, talent relationships, and so on — especially when that edge happens to be cited in recent research as being within the genre most desired by podcast listeners. But that isn’t necessarily the case, and the move is perhaps better contextualized with the knowledge that Sony Music has previously worked in the development and distribution of other types of non-music audio content, like stand-up comedy recordings.

This arrangement comes as an interesting logistical development for Davidson and Mayer, as the duo had recently formed a separate venture — Arrow Productions — to produce a Luminary show called The Passion Economy for exclusive distribution behind the app’s paywall. I’m told that this joint Sony Music venture is the next step of their work, as all of Mayer and Davidson’s future projects will be funnelled through the new entity.

But where does that leave The Passion Economy? That production, I’m told, will keep going in its current form. “We feel great about it,” Davidson tells me. “We’re hearing great things from listeners. We feel like we hit the voice we wanted. Lena Richards, the show’s producer, is amazing and will continue to work on the show.”

I asked about the thinking driving the choice to partner up with Sony Music — specifically given the pre-existence of Arrow Productions — and Davidson replied:

When Laura and I started working together last year, we decided we would have no investors, no corporate partners. We wanted to be able to do work that we loved without having some outside entity demanding we hit external metrics or satisfy their external strategy. Sony Music reached out to us and we were, initially, skeptical. Over time, though, we came to see that Sony is a creator’s company. They see their core competency as supporting artists so they can do their best work. They are able to give us this amazing global infrastructure. They know how to market and distribute audio content to people all over the world. They know how to manage a portfolio of creative products. This is a real strategic partnership, where we all feel like we have a lot to learn from each other.

I suppose it’s also worth noting that forming joint ventures directly with creators is not a particularly uncommon move for Sony Music, which has generally forged such arrangements with specific musicians to create new music labels. Of course, the metaphor here isn’t strictly one-to-one — I reckon the Sony folks would be hesitant to use the same “label” language in this instance, because it means very specific things in the music industry context — but the general direction of the logic is very much there.

Anyway, Mayer and Davidson are now setting up show in the Brooklyn neighborhood of Gowanus, and they hold plans to hire for producers soon. So keep an eye out for that. (On a completely separate note, did you know the city is rezoning the neighborhood to allow for high-rises? Man.)

Two miscellaneous thoughts:

  • I fully expect to see similar plays from other major music groups.
  • One way to think about this joint venture, from the creator’s side: it’s an alternative to raising venture capital money to start a podcast content company — though, it’d probably one that isn’t very accessible to most.

Okay, let’s move along.