For this special edition of Amalgamation, we speak with one of the most accomplished executives in music publishing, Mr. David Renzer. Most recently, he joined forces with Saban Capital Group, a leading private investment firm based in Los Angeles specializing in the media, entertainment, and communication industries, to launch a new music-publishing venture, where Renzer takes on the role of President, Music Ventures. This opportunity comes after more than a decade with Universal Music Publishing, where he served as the company’s Chairman.
Mr. Renzer, how did come to join forces with Saban?
Saban has been active in music for quite some time, especially in music related to film and television. There is a new five-hour block on the CW network where Saban is putting a lot of original programming in place, and with new music being created for those shows. If you look at all o f the consolidation happening with the Majors [publishing companies], Universal & BMG, SonyATV & EMI, and of course, with BMG & KKR buying up the mid-sized companies, there is a gap of opportunity in the market. We believe it is a great time to offer up a well-financed boutique to take advantage o f film and TV opportunities—not unlike what I did at Universal Music Publishing where we handled the music rights for Universal Pictures and for Warner Films & TV, HBO, Dreamworks, and other independents. As a boutique, we can create more opportunities for our writers and our catalogs. There really isn’t another West Coast-based, well-financed independent publishing company, so we have a lane or slot to build, develop and grow, and to plug into the other Saban divisions and brands.
Is there a name for the new venture?
As we make acquisitions over the next few months…we’re looking at both catalogs and some companies that can function as sort of a platform, an infrastructure solution, meaning administration and staff. The goal is to be up and running with an operating company as well as catalog, quickly. Once we complete those acquisitions, we will look at the naming and the brand. There may be [an existing] company that has a good brand, and we might decide that it becomes our operating company.
Coming from a behemoth publishing company like Universal, how will you fare in a boutique environment?
I’ve seen and worked in both. I started at Zomba, which was one of the leading independents and was a very creatively driven and boutique publishing company. Ironically, we ended up acquiring it through the BMG acquisition at Universal. I started out on the independent side and then of course as president of MCA Music Publishing, which evolved into the Universal Music Publishing Group—until the recent Sony/ATV/EMI deal, [UMPG] was the largest music publishing company in the world. Honestly, it ’s quite a challenge to manage a huge roster and millions of copyrights; it ’s a daunting responsibility. But I’m rejuvenated and energized about the idea of being entrepreneurial and having a boutique.
What most concerns you about the business of music today?
No question in the short team, our industry still has challenges. On a longer-term basis, we have this tremendous shift towards streaming. I think that in the short term, iTunes as a business continues to grow. That is a positive. But where does iTunes shift to as streaming becomes more popular? You see how You Tube is the No. 1 music source for the younger age demographic. That’s mainly where people are discovering new music right now. People think of [You Tube] as a music site, when it happens to be a video site. Every income stream is challenged right now, including ‘performance income’ due to the renegotiated blanket licenses with radio. One of my goals here is to create a super-synch department and really try to emphasize the film and TV opportunities, because that ’s one of the few areas you can impact catalog and growth.
Is there still growth in the film area since the decline of movie soundtrack sales?
The soundtrack business doesn’t have the blockbuster hits it used to have but there are still ways to make money with soundtracks, film scores and with composers for film and TV…such as leveraging relationships so you’re creating opportunities for your catalog, writers and producers. You can grow your synch business. Not just soundtracks are challenged. There is a lot of downward press on pricing in film, TV and with commercials. Unfortunately, there are people that are ready to give their music away in some cases. I think it’s important to preserve and maintain the value of music.
Honestly, do publishing companies dislike the streaming services models of Spotify and Pandora?
Spotify and Pandora are licensed differently. With Pandora, the lion’s share of the money that they are paying out in royalties is going to labels and artists per SoundExchange. Spotify has a very complicated licensing structure, though. I say the jury is still out on whether there will be meaningful royalty payments for songwriters and publishers through Spotify. There are many question marks surrounding streaming services. I use them. You can see why consumers like them, but from a business point of view there are definitely questions. As the services grow in popularity, are the income streams going to become meaningful enough to make up for the loss in mechanical income, the loss in sales, and the performance income? If you look at the digital income from the performance rights societies, they are quite low as a percentage of their overall collections.
After years of successfully running UMPG, you take on a new opportunity. What drives you?
I’m a music guy, that’s what drives me…Find something you love to do. I couldn’t ask for a better situation in terms of having partners that are a great fit. They are prepared to invest significant capital, and we are prepared to share the same vision in building a meaningful, exciting boutique publishing company.
Interview Conducted by David A. Mitchell