MIDEM2007 MPAJ ConferenceLIVE MUSIC NETWORKAsian Session: Take the A(sian) Train

Jan, 22 nd

2007

Auditorium Esterel, Palais des Festivals, CANNES

-sarah Fund-

MIDEM2007 MPAJ ConferenceThis project is promoted under a subsidy granted Common Purpose Fund from sarah,The Society for the Administration of
Remuneration for Audio Home Recording,which fund was founded to publicize the principles of copyright.

Moderator :SW⇒ Stuart Worthington, Head of Training & Education,
Music Managers Forum(UK)

Speakers:
NT⇒ Nori Tsuzuki, Manager, International Division,Kyodo Tokyo(Japan)MO ⇒ Marcus J.Ough, Managing Director,Poptune Productions (Korea)
JL⇒ Jiang Ling, General Manager, China Tai Ice Production (China)

SW: OK folks, thank you very much for waiting forthe handover there. I’m very pleased the panelists
have agreed to give us their time this afternoon for
the next panel entitled “Asian Session: Take the
Asian Train”. With the implication behind that title
that there are lots and lots of opportunities forinternational

artiststodevelopaudiencesin

Asia-Pacific and Asian territories - and equally that
there are lots of opportunities for artists from thoseterritories to develop international audiences overhere in Europe.
I should first of all introduce over here on my left I have Nori who has been
active in the capacity of tour management and recording production services,and worldwide management. Your company has been established for 45 years,
you’ve been involved in live productions on the sport and entertainment sidewith that company for many many years. The recent Madonna tour for example.
Can you explain to us a little about what you are doing now and what you areplanning to do?

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NT: Right, we have basically been a concert promoter for the last 45 years, as
Stuart said. We continue to be a concert promoter for both domestic andinternational acts. But at the same time we just started doing management
outside concert promoting as well as master recording production, to havebetter control for overall touring in the Japanese market.
SW: And next to Nori, Marcus. You’ve also been involved in not only the live
production side but also the recording company side for many years. Could you
just explain a little bit about what you are doing now and how things might bechanging for you?
MO:.Poptune Productions is one of the leading record labels in Korea.

Ourcompany does artist management and live productions, as well as licensing
works for overseas record labels.

But we only license work that fit our market.

We also have been in live production for the past couple years.
on our catalogue so far.

It is all based

But we are definitely looking for some fresh new

items for the future. So I can definitely give you some aspects of our recordlabel side.
SW: Thank you. Our final guest is Jiang Ling from China. Jiang Ling you are
known as the point of contact for international artists. And again both involvedin both the sound recording production side and the live music production side
for many many years. Could you tell us a little bit about what you are involvedin now and what you are hoping to do?
JL: Hello. Good afternoon everybody. I am the president of the China
International Art Exchange Agency, and also the president of Chai Tai Ice
RecordCompany.

One

is

for

production

andrecordingartists.

The

International Art Exchange Programs is for introducing live performances into
China and also for exchange to bring live acts into the world market as well.
Being with these two companies, I was able to view from a very complete line tointroduce the music scenes into Chinese audience, and hopefully international
market as well.
SW: OK, we have three very different territories in terms of the market and theculture and so on. But I suppose I should ask the same question of all three ofyou. That is, starting off with what are the opportunities for international
exchange or particularly for international artists to develop audiences in yourterritories? And then we’ll start looking at what the barriers to that kind ofdevelopment are and what those issues are around those barriers.
But first of all, Nori, what are the opportunities? When we were chatting
earlier on, you confused me a little bit by saying that actually often you can

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have too many international artists coming over to Japan.
NT: Well, there are certainly many opportunities in Japan for international
acts, especially these days with such great rock festivals in Japan. But I guess
it all depends on the level of the artist. If it is a bigger act, the opportunity
actually comes automatically because we get asked to promote. But for up andcoming acts we sometimes have a hard timetrying to set the situation up in the market on
our own. So we will seek for label signing inJapan first and see where things develop in
the market. And then try to figure out what
we can do on the touring side. At the sametime, and in the last couple of years especially,
thesummeropportunities

festival

has

for

label

the

providedtogreat

launchaparticular artist in Japan. So more and moreinternational acts are coming to Japan thesedays, and use the summer festivals as alaunching pad.
I often speak with many local labels andthe issue is that some are under the impression that securing a slot at asummer festival will increase exposure and album sales. But in reality there
are only a limited number of media in Japan covering all the major acts tobegin with. So unless a local label sets up great press coverage using thesummer festival appearance as a tool, I don’t see much additional revenue
coming in as a result of the summer festival. So the key is teamwork these days.
None of us make big bucks on our own. So a concert promoter, label, sometimes
publisher, and even management, must all work together, all looking towards
the future.

I think that is the key to creating great opportunities for the

future.
SW: I need to ask the same question of yourself Marcus. The perception may bethat there a lot of opportunities to do lots of live work over in Korea but there
may be opportunities to sell significant amounts of records. True or false?
MO:It is true that the situation in Japan is pretty much the same thing
happening in Korea.

We are currently looking for good licensing material &live acts in Korea as well.

Even though the size of the market in Korea,

compared to China and Japan, is smaller, we are definitely looking for goodmaterial. Basically, we are trying to find a good catalogue from overseas. It isvery important to get the right partners in every territory, especially in Korea.
It doesn’t matter if it’s a licensing partner or a manager type agent. You should

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be getting the right partner. In that case, you can get involved with themarketing plan, with the promotion type deal, and automatically getadvertisement for your live acts and catalogues as well.
SW: Before we come to the area of branding involvement and sponsorship could
you give us an indication of what sort of record sales we may be able to expect?
I know it is a rotten question because it will vary from artist to artist.
MO: Yeah, in Korea the international label forsales wise is not that great. We actually
releasing the White Stripes last year and weonly sold 3,000 copies.
SW: 3000 copies?
MO: It is true that in Korea the sales ofinternational catalogues are not that great. We
actually released the White Stripes album lastyear and only sold 3,000 copies.
But compared to big artists like Eminem andMadonna, it is around the same figure. They
sold around 10,000 copies last year.

But some

good unknown artists on independent labels could sell from 3 to 5,000 copies. It
is pretty much the same figures.
SW: OK, I’m going to come back to that. But I need to ask the same question of
Jiang Ling. What are the practical opportunities now for international artists
to develop audiences in China?
JL: All of you know, there is no need to explain how big the China market is, it
is just big. This is including the live performance market and the record
market deals, it is possible.
SW: OK, I’d like to stay with Jiang Ling for the moment because we weretalking earlier on about the different mix of income streams and what sort ofrevenue comes in to cover the cost of productions and promoting tours and soon. And I was very interested in the ratio you gave us of what percent ofrevenue comes in from ticket sales verses what percent of revenue comes infrom brand association or sponsorship?

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JL: Well actually in the past China’s market was more based on the ticket
sales income for all the live concerts. However, in
recent years, since the technology is changing andthe market is open, now they start focusing on theso called media income. Actually, in our words, it issponsoring income, and that has now increased up
to 50% of the total income for the live performance.
SW: OK, I need to ask the same question of
yourselves in terms of how it works in Korea andJapan. But for an artist’s management perspective,
what can I expect? Am I expecting two separate
deals? One deal with the promoter, one deal withthe sponsor?
MO: If I feel like a deal, I am definitely looking for the promoter side. The
promoter getting to business with all the sponsors is very important. Like
media sponsors, some cable channels, and some coorporate sponsors from big
companies. Sometimes these company sponsors cover everything for concert
expenses, depending on the concert.
.
SW: So at the end of the day it varies enormously. It can be anything from freeproducts right through to wholly owned show in terms of relationships with thesponsors. Same in Japan? Any issues we need to understand about working
with brands and sponsors for Japanese concerts?
NT: Well, we always try to have sponsorship, especially corporate sponsorshipas it is always nice to have more budget. But in reality we, I wouldn’t say never,
but almost never obtain decent corporate sponsorship for club shows. The
capacity needs to be there to attract corporate sponsorship as well as the statusof the artist, otherwise they would not get what they are after. So, yeah, forbigger acts it is obviously easier to for us to get sponsorship. But with smaller
acts we sometimes don’t even bother with sponsorship. For bigger acts, fromthe financial point of view of management, there is not much difference
between revenue secured by sponsorship and revenue from gate income
because they need to make the tour happen in the end. We get pressured bymanagement to have corporate sponsorship on top of the artist’s guarantee toincrease the tours revenue.
SW: OK, well we’re painting a fairly rosy picture here that there are lots ofopportunities, and there are income streams from associations with brands andsponsors. And there are opportunities to play in key cities with media

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opportunities. And yet you started out in your introduction Nori by referring to
the key issue of the need for teamwork. What isn’t happening that should be
happening?
NT: Well…er, I guess everybody is thinking about their own pocket to startwith. But I don’t think any touring companies are making any profit for up andcoming acts, nor are the record labels. So instead of trying to control things on
our own on the touring side and label side separately, we should collaborate
with each other. Maybe have the label do a certain promotion. We are certainly
able to setup other promotions that a label cannot setup. It is all about
teamwork in the sense that we focus on the long term benefits of an investment
in a particular artist thus laying the foundations for a great future together
where we can recoup the initial investment.
SW: OK, in a moment I’ll be asking Jiang Ling about what you require in order
to work as a team with a partner in developing audiences in China. So whatkind of information you require or any recommendations you would make fordeveloping partnerships. But before I go over to Jiang Ling I need to ask thatquestion of yourself Marcus.
To set the scene I may have signed my artist to a multi-national record deal, I
would expect my international department (at the record company I’ve signedto) to be doing the work to develop the potential for what could then turn into along term strategy and a plan. And look for the right partners so that then we
can work together with our sound recording licensees or affiliates and theconcert promoters. This doesn’t seem to be happening in the way that I mightwish.
MO: I say once again, you should be getting the right partners. We are all here
from independent labels, small labels and small artists.

It is nothing like bigtime & high level artists. We are trying to find some good partnerships
overseas, yes it’s really hard, but how we do find it?

It is totally up to you

guys to start doing things like sending visual packaging, and things of thatsort. Not just looking for live production agents but also trying to find somelicensing partners as well.

You can do a deal with a record label overseas.

They will probably help you and put all the marketing tie-ups as well as the
management type deal. Of course they try to make profit out of it eventually
but they are trying to increase the album and artist reputation, not just
immediate financial benefit.
SW: So it sounds to me that the best position I could be in is to do territory byterritory deals as opposed to a worldwide deal if it means that I might find thatmy company is not working with the right partners.

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MO: If you sign up with a worldwide deal then you have to persuade yourpartner and ask things like “what is happening in that territory?” “What ishappening in Japan, what is happening in Korea? You cannot release an album
if they are not doing anything for the territory.

If the 1 st option deal is notworking at all, you can find a second option type deal. You can actually givethem some positive pressure.
SW: OK, so it begins with making contact with you so you’ve got information
about the artist. You need audio visual representation; you need to see how theartist operates in the live environment. Is it as straight forward as that Jiang
Ling? What do you need in terms of information about artists and from whom?
JL: There are two factors to select the best program if you want to do a live
performance. The first, one of course, as everyone knows, is if it is presentableor if it is interesting. There are several materials that will be required: audio,
his biographic information, lyrics- especially lyrics. Actually, I would like toemphasize that. If you have a different language, you do want to provide an
English translation, too. All the necessary paperwork, and all the visualmaterials. Those are needed for the factors that we are going to present here.
The second factor is involved from the cultural aspect. As probably some ofyou have experienced, Chinese also do have a kind of different taste anddifferent interests related to how your artist looks and how your artist
performs on stage or just from the picture wise. Very often we find a very
standard from the western standards and the Chinese standard. Westernartists you would think is (using) a very integrity expression. But, in China it
may not be suitable due to what our society’s customs are used to.
The other thing there is a political procedure that we have to also follow. All
these papers, all the content, visual material must be approved by the Chinese
government prior to all the permits.
SW: Marcus you also have a governmental agency in Korea that provides arange of opportunities?
MO: Yes, this is a very unique thing. It is all about information that we don’tknow yet right? We are definitely looking for information for different
territories. In Korea there is a certain agency which is run by the government
called ‘KOCCA’. They actually support some showcases in Korea for foreignacts, including the financial side. You can actually check out all theinformation happening about festivals. Tours and music activities we have in
Korea, like Fuji Rock type festivals, jazz festivals, and hip hop gatherings. A
lot of things are going on. But it is all out there. Everything you need is on thewebsite.

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SW: In a moment we aregoing to open up to thefloor for any questions
about what people in theaudience may be wishing
to do or know about. But
Nori

in

your

introduction

youmentioned that you aredeveloping management
services. When we werechatting

earlieronitseems faintly ludicrous that a lot of managers in Europe for example, andspecifically in the UK, in my case that I’m aware of, would automaticallyassume that they may need an American partner. In some cases they don’t but
in many cases there is that assumption that I need a co-manager for the North
American territories. For Asia Pacific we’ve already heard mention of thedifferences in culture, there’s obviously the language. There’re opportunities tofind the right or the wrong partners and yet co-management in these
territories doesn’t seem to be the norm, doesn’t seem to happen at all. Why?
NT: I don’t know the reason why. That’s why we’re actually starting
management services. The real issue is the lack of understanding of culturaland business differences across the industry. That’s why I guess you are here tolearn about our market. There are so many different things about how people
think and why people actually enjoy particular music, and their motives forbuying a ticket. In Japan, the market for domestic acts is much stronger thanthat of international acts.

Record sales for international acts generally makeup only 20% of the market compared to 80% for domestic acts.
As far as touring cities is concerned, Tokyo consists of 45 to 50% of the entire
market. The second largest city, Osaka, you can only expect about half of that,and the third largest city, Nagoya, even half of Osaka. So we often get asked tosetup a high number of shows per tour in Japan but if you think about those
figures you can see it is not feasible to perform shows in regional cities. As well,most of the influential media are based in Tokyo. The most cost effective option
for a Japan tour is to book shows based in Tokyo to get the best of media
coverage, exposure and higher venue capacities that translates into higher
revenues.

These

are

detailsthat international

artists,

promoters

andmanagement aren’t aware of but need to know.
When I tour the rest of Asia with a domestic act I face exactly the sameproblems of cultural and business differences. I toured in Taiwan, Hong Kongand Singapore, and I felt totally out of the situation. I was in the same position

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as you are in the audience right now. So you’ve got to understand that even the
Asian market is still premature, still developing. We, ie the panelists, probably
need to figure out how to fix that after this panel but at the moment the key is
to find the right partner for what you want to do in the market. There are many
choices, especially in Japan for what you are after. Whether you want to go forlong term or short term, you want to set everything up around summer
festivals, or you want to try to avoid summer festivals. People need tounderstand that each genre in Japan has different drawing power comparedwith the same genres outside Japan. So there are so many things I can talkabout. I can go on for probably a couple of days if you let me. But that is why I
think you guys can appreciate how important local management is for ourmarket.
SW: I need to ask all our panelists one more question before we open out
questions to the floor. And that is what are the barriers to developing
audiences for both international, for example Chinese artists over here, orinternational artist over in your territories? What the barriers are, because it
sounds fairly, not straight forward, but it sounds methodical. It is all about
long term planning, it is all about finding the right partners. It is all about
getting communication between the right partners. And we can develop a
strategy so long as we’ve planned and given ourselves a realistic lead-time. It
is not that simple though. What are the barriers? Or is it that simple?
NT: When we like some particular act we want to bring over it is obviously
easier because we are interested in (them). But in most cases wheninternational acts wants to cultivate our market you need to find out whether
there are people interested collaborating with you, or trying to invest in yourproduct or artist. But the chance are there are not many concert promoterswilling to take on the risk of investing for long term unless there’s someprospective situation especially in the UK or the United States where the core
local audience get their first information from. Then we can try to build a local
foundation on top of that. We also need to have a local label build foundations
with the media.

I think when people look into having a tour in Japan it is agreat idea to have a local label on board before talking to any concert
promoters, to help with initial penetration into the market.
SW: OK, is it somewhere in Korea you are not going to be interested unless theaudience over there has access to a media profile through western media forexample, or that there is a local label in place? What’s your criteria for yourinterest?
MO: It depends on sales. If we really like the catalogue with certain

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expectations, then after that we can decide to bring the artist over to Korea bybuilding up the reputation through live acts. Once we get the deal we are notlooking forward to an immediate income.

Local partners will definitely look

for their reputation or like to follow the long term plan. Maybe we screw up thefirst time, a couple of times but end up getting a financial benefit out of it. And
building up a good reputation is the key point here. They can have their own
shows and many of them. If I add to Nori’s comment, finding good partners
through the record label & Promotion Company. It’s all same things. Livepromoters probably knew a lot of information about a good label over in Japan.
It is the same situation myself, once you get in touch with our label or otherlabels, I will try to help you myself. If your catalogue does not fit into the label
we can actually introduce you and your catalogues to other local promoters forLive Shows. There are a few good promoters out there and they are willing todo the show. It is all connected.
SW: OK, last question to Jiang Ling. Is it the similar situation over in Chinathat you may need a local record label in place before you are going to beinterested? What’s the criteria? What are barriers that we’ve got to lookthrough at the end of the day unless we are successful to your standards, there
aren’t going to be those opportunities?
JL: These past few years the China market is very wide open for a lot of famous
productions such as the Lion King and Phantom of the Opera (which made a big
success in various markets). All these are actually being performed in China atover 100 venues at the moment. So China in many ways has been exposed to allof the most well-known programs you can imagine at this moment.
Another resource that they have come (to our market is) from a lot ofindustries, product companies since everybody tries to develop (in) China. They
very often sponsor certain artists and plays well-known in maybe theircountries. They try to bring in their ideas, good programs in order to sponsor
them and reach the advertising effect there. So, that is another kind ofdifferent way of coming in.
A lot of these are, across multinational companies, just to meet their demandinternally. Very often the live performance can get them reach the profit region
there. So they have been able to bring a lot of different variety shows, musicshows, plays and such for the China market at this moment.
Another recent development is through the Internet. Everybody can easily
access the different kind of artist’s presentation. Through the TV dramas, theChinese audiences now have learnt so much about Korean music, dance and theTV dramas. So it is a phenomenon there now. Everybody knows about all the
Korean artists through TV programs and that is another way to introduce yourartists.

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Q and A
SW: Thank you, OK, well it is always frustrating when we do these panels that
we run out of time when we’ve got so much that we can learn from our guest
speakers, and most have come from a great distance to be here. We need tothrow it open to the floor now. So if there are any specific questions? Question
here?
Q1: I have a small independent label that is in the States looking to explore,
expanding our product line to both Japan and Korea specifically, but we’re notruling out China of course with the market there. Is there a specific thresholdof sales like you indicated that would indicate that there is an interest level
enough to warrant promoting or examining, exploring a live show in thatmarket? Is there a threshold number?
SW: Is it a threshold plus a media profile, or is it a media profile more
important than a threshold? And is there a threshold?
NT: Well, it depends on the genre of music. Do you mind telling us what kindof…?
Q1: R&B and jazz.
SW: R&B and jazz?
NT: R&B music is very hard to say. It all depends I guess…We, I mean forJapan , take about 30,000 to 60,000 copies minimum as a ball park for R&B.
And for jazz, to be honest with you, our markets are really shrinking for
touring, unless you are looking to tour with some big name, it is very hard tocultivate. For others in the audience, I’ll briefly discuss other genres. For rockmusic I’d say about 10,000 copies is a good mark. Unless it is heavy metal rockmusic, there are hard core fans to see the shows. So you don’t really refer toalbum sales that much. Album sales might be really poor but you still get anaudience. So it all depends.
MO: In Korea it is quite different. Unknown R&B or reggae artists are notgoing to happen.

Here they have a very tiny chance they’ll get anywhere

because audiences have no interest in them. But in the case of jazz, if the music
is good, you can tie it up with all the domestic partners. You can get very goodresults. Maybe sales are around 10,000 to 100,000, if the music is good.
SW: Jiang is that relevant in China? Is there a threshold of sales below which

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you are not interested that should have been made in the domestic market?
JL: Well, actually most of these records are not available in China.

There is apossibility for reggae and R&B type markets. Because all of the major markets
in China now are well exposed to western culture, especially the young student
population very very well receive this kind of music.

SW: I’m so sorry to do this folks because I know there is a lot of interest in ourguest speakers while they are still here. But I’ve just been given the cut off
notice because we’ve got a lot to be packed into this day. If you are interested inthis area there maybe an opportunity to speak to some of the individual guests
here just before they leave. But otherwise hopefully we’ll start developing more
opportunities and certainly to meet them next year to explore a lot of theseissues in greater detail. So if you were frustrated by not finding out certain
aspects please let us know and we’ll see if we can do something with thequestions that you send us. But if you don’t mind for the moment can we thankour guests for coming the distance they’ve come for this panel.

-END-

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