Inside the Music Business: The Grammys President on the Fight to Protect Artists (Panos A. Panay)

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3:03Hello, it's Amol here. And it's Amol sounding even more excited than he usually does because we've got a very special week on Radical. We've got two back-to-back episodes on two different aspects of culture and entertainment. So you know by now that Radical is a safe space for conversations about the deep global trends that are changing our world and really offering you some Radical ideas for the future, and in both music and television. There is a lot of talk about whether or not those aspects of our culture, of the modern entertainment industry, are going wrong, and how they should deal with not only the revolutions of recent years, but also what to do about the coming tsunami of AI content.

3:44So on Sunday, you'll be able to hear my conversation with the executive producer of The Night Manager. Huge, huge, huge hit show on the BBC, on the iPlayer, starring Tom Hiddleston and lots of other very famous people. It's been pretty well received. But on this episode, I am joined by Panos A. Panay. He is the president of the Recording Academy. And that is the organization based in America, but huge, huge, huge influence around the world, which is behind the Grammy Awards. And he's going to talk about some of the challenges facing his industry, like the rise of AI generated music. There's a lot of it about and also how to nurture new talent in such a deeply, profoundly fragmented media environment.

4:27So come with me on a journey into the glorious world of entertainment.

4:36Panos, it's so nice to see you. Thank you so much for coming in. Great to see you, Amol. I mean, you know, the wonderful thing about seeing you is that we could just spend an hour talking about music interests, and we could talk about the kind of music you listen to and the kind of music I listen to, because we're both music nuts. But I think maybe a good place to start off with, because it's where our listeners would start off, is just explaining a bit about what the Recording Academy is. So the Recording Academy is a nearly 70-year-old organization. um it's comprised of approximately 30 000 members uh 15 000 of which are voting members and the mission of the organization is ultimately to be the foremost advocacy organization for what i think is the most important class of citizens and that is the creative class or in our particular case, music creators.

5:30Most people know us as the producers of the Grammy Awards, but that is a one-time-a-year, one-day-a-year event. The Academy is a 365-day-a-year organization that is dedicated to advocacy, support, education, community building among these creatives. And when you took over, how did you want to update the Recording Academy to kind of meet the challenges of music today, which we're going to discuss? Well, as an immigrant, as somebody for whom English is not my first language, though as somebody who's actually learned English by listening mostly to music, so I still have word associations with songs to this day, I felt very strongly that the organization has a unique platform to expand his mission to embrace creators no matter where they are.

6:28I like to say it doesn't matter what passport you carry, what language you speak, or where you were born by sheer lottery, if you will. You have a God-given right to be able to express your talent. And talent is distributed evenly around the globe, but opportunity is not. as somebody who was born and raised on a very small island. I know that firsthand. And really, I mean, I guess it's one of the stories of your life. Music does have a unique power to bring people together, an extraordinary power to bring people together. And the benefit, if it could just be deployed correctly, of new technology is it can really collapse that gap between a creator sat at their piano or in their bedroom or in, you know, if it's the young Jimmy Cliff today in their bedroom in rural Jamaica.

7:19and some fan could be in outer Mongolia it could be in New Zealand but some fan who loves that creative output yeah that's that's amazing when you think about it uh when I was a kid growing up in Cyprus I heard about this thing called jazz music because I picked up the guitar and my guitar teacher was a Lebanese guy. And he played me a record by a guy called George Benson. And I remember thinking, what the hell is this? It was a record called George Benson Cookbook. And, you know, until that point, most of my music listening was through either Cypriot Radio or BFBS, the British Forces Broadcast System.

8:20Of course, yeah. And that's where I heard all my English music. Because of the British military base on Cyprus. Exactly. Or through pirated videotapes of Top of the Pops. That was my only musical experience. And then when Ramsey, that was his name, that is his name, he's still around, played me George Benson. It was like the scene from Back to the Future when Marty McFly goes to 1955 and his dad is sleeping and plays in Van Halen. I had the almost reverse part of that with jazz. And the only way I could listen to jazz was by going to the British Council in Nicosia and go to the library there. They had a record library and find Miles Davis and Louis Armstrong and Duke Ellington.

9:10And I'm just thinking, and my mom worked for the United Nations. And when she went to New York, I begged her to buy me a tape of a guy called Charlie Parker. I read about Bird, but I had no idea what Charlie Parker sounded like. But I'm thinking how difficult it was for me to connect with music, to expand my oral universe to something completely different than what somebody chose to give me. Whether it was Greek music through Rik, which is the, or CYBC, the radio station at the time. We only had one radio station. We only had one TV station. And I'm thinking, we lose sight sometimes when we talk about the world of today and the absence of gatekeepers because we also forget how difficult it was not that long ago.

10:08I mean, I'm talking about the 1980s. I'm not talking about the 1910s. For a young music lover like myself, who was born in a small country, to access music. And arguably, had that not happened, I would have dreamt a little less. I would have had a little less spring in my step. I would have had a little more diminished spark in my spirit to go on and hopefully achieve something with. Well, I've become one of the most influential figures in music. I mean, which is what you are. How did you go from being a kid in Cyprus, listening to jazz, to being someone who would in many ways have the kind of, I'm not going to say the American dream, because that's a loaded term and it's for you to say, not me, but to have the immigrant story in America and to rise up as you have done?

11:00I grew up in a, during a very difficult time. My first memory is war. It's the 1974 Turkish invasion of the island. I was very young. And then I grew up in that post-war Cyprus with a lot of refugees and a lot of strife and a lot of difficulty. And I think when you're from islands, you have an inherent desire to engage with the world in a very different way because you're constrained and you feel those constraints. There's a sense of aspiration almost to escape or to get somewhere else. Yeah. And I grew up not only on a small island, but a divided island at the time with a lot of fear and i that just gave me a particular drive and desire to go out there and engage with the world and and and yeah listening to english music um watching live aid in 1985 spending hours and hours and hours in my bedroom deciphering lyrics of of primarily 1980s british pop artists really gave me, I don't know, like this dream, this ambition to kind of go out there and be part of this industry.

12:27So is it to New York that you arrived? No, I went to Boston. The only route for me to have a legitimate life as a musician was to go to college. The only college that I knew at the time that would teach the kind of music that I care to engage with, which was not classical music, was Berklee College of Music, which is why I landed in Boston. I had no plan B. My plan A was apply to Berklee. I wanted to become a jazz guitarist, and hopefully I get in. In Cyprus, we have mandatory military service. I thought, gee, if I spend two years in the army without touching an instrument, there's no way for me to ever be able to get into Berkeley.

13:16So I picked up the trombone, learned how to play the trombone as a means of auditioning and getting into the army band so I could spend a couple of years at least being exposed to music. I got lucky enough to go into the army band in the Cypriot army for a year of the two that I had of service. I was very fortunate because at the time, Berkeley had a very high acceptance rate, unlike today. I got into Berkeley and that's what enabled me to go to Boston and I studied music. I found quickly that I wasn't good enough, switched to music business. I finished college in three years. American universities, for those who don't know, are four, unlike British.

14:04um and again sometimes not having options is uh a very powerful motivator and i thought okay unless i somehow managed to stay in america my i could just see a life of yeah you know working in bouzouki restaurants and and having plates broken around me or whatever you know playing greek Greek music or teaching in elementary school. Nothing wrong with any of this. It was just not the life that I wanted. I didn't want to go back to Cyprus. I was at the tail end of my time. I got an internship for a talent agency and I thought this is my chance. And I apprenticed under the owner. eventually I rose to become the agent for all the ex-USA tours of artists for listeners who are into jazz like Pat Metheny, Chia Correa Nina Simone Leonard Cohen on and on and on some minor artists but that was a great experience this was the 90s people forget what it was like to have to pick up the phone calls a complete stranger, a promoter, pitch an artist.

15:26You had to describe what the artist sounded like because there was no way for anybody to go to the thing called the internet and actually listen to music. Then you would send a compact disc and it would take about a week. By the time you call back, they would forget what the hell you were talking about. So it was just a, it was a whole process that, that again, you were talking about the, the wonder of where we are today. I never stop just loving where we are today because I do remember a very, very different time. So when it comes to the artists that you're looking for, I want to be really brutally honest here.

16:03You represented, you mentioned the likes of Leonard Cohen and Nina Simone. What made, what were you looking for as a talent agent then? So let's say 25 years ago, turn of the millennium. And if we're really, really honest, in an era of streaming, in an era of global distribution, frictionless global distribution through streaming, what are you looking for now? So in 2000, someone comes along, says, Panos, I have a dream. I want to be the biggest selling artist in the world. Tell me brutally what your process is. Brutally, it was, can I command a fee of$2 ,000 to$3 ,000 a night for you? Because as an agent, I make 10 % commission.

16:45Um, otherwise I can't take you on as an agent. I don't have time. You know, imagine working your tail off, making, you know, two, 300 calls a day to sell an artist that makes a thousand dollars a night or$500 a night. Well, 10 % commission, you can do the math. You need a whole lot of bookings. Yeah. Um, so it was an economic, uh, question. Then it was a question of team. Do you have a record label? Do you have a manager that I can deal with? So the questions were less about music, at least in my position as an agent. I think it would be different if I was a talent manager. But as an agent, my job was effectively to be a booking machine, taking an artist and then being able to maximize my effort in order to book a tour for them.

17:49Today, it would be a lot more about your internal motivation. And of course, the questions that I would, you know, the upstream questions would be a lot around your social media following and your streaming. And it would be data, data, data. The word data existed in the 1990s, but it was seldomly ever used unless you were a Latin scholar. You know, I never asked any of these questions. It was much more about the judgment of individuals. Today, you have tools, you have access to numerical information and the magic word of data to make all kinds of calculations. Heck, you can make predictive calculations on the ability for you as an agent to actually maximize the earning potential of an artist.

18:46So I have... Sorry, you can even better match the artist with a particular venue. I mean, if you have, especially today with AI, you can go there and with the right prompts, you can get answers to the types of questions that I could only get answers from by picking up the phone and making hundreds of calls during the day to then be able to decipher. can I book this artist? Can I create a sustainable tour or not? Has something precious been lost when we lose that creative spark of you 25 years ago saying, okay, you need a data then as well. But when you lose that human judgment, has something valuable gone, do you think?

19:42Oh, without a doubt. um you know what i did not get around to in my answer earlier was also that after i got some satisfactory answers to those initial questions then the next step was i want to go and see this artist perform live how does he make me feel she how does she or he make me feel how does the audience respond when they're in the presence of this performer? How do they engage with an audience? Because you know, that's the magic. I think, again, I never want to talk in absolutes because that still exists, right? But so much of that process has been outsourced to this numerical statistics that we've almost become a bit too clinical about the types of artists that people choose to engage with from, again, when the leading driver's commercial considerations.

20:51I'm not talking about as an audience member loving music, but I'm talking about from a business standpoint, if you're going to choose to take a bet on an artist in any capacity in the music industry, whether it's on the recording side, whether it's on the management side, whether it's on the booking side, whether it's on the publishing side, on and on and on. A lot of the questions are posed through the framework of numbers rather than through the earlier framework that I was describing. So I want to ask you about an artist called, a very particular artist called Sienna Rose in a moment. Just before I do that, the argument a few years ago now that Taylor Swift made very volubly was that basically creators weren't getting a good deal from streamers.

21:37And this is a very familiar argument to people. Spotify, Daniel Ek, the extraordinary Swedish founder of Spotify has had this argument for years and years and years. Could you just take us inside how you think about whether or not musicians, creators are getting a fair deal from the very powerful companies who now, outside of record labels, who now dominate the industry? Look, the economics of the industry have changed tremendously. And no, I mean, my view is generally that, no, artists should be making more from streaming services, undoubtedly. Why are they not making any? Well, not any, sorry.

22:18Why are they not making as much as they should? Because the economics of a streaming model are very different than the economics of an analog model of compact discs and LPs and so forth. And the way that streaming services distribute royalties and income is just very different. I won't go into all the arcane mechanics of that. And of course, as an organization, that's our foremost piece of advocacy. How do you get more equable distribution of the pie? Because without creators, we have absolutely nothing. On the other hand, I do believe that a few things have been positive. Many things have been positive.

23:10I'm old enough to remember when the industry came close to annihilation. When was that? With piracy, right? In the early 2000s. I mean, the industry, absent of the development of legitimate streaming and legitimate download market at the time with Apple's foray with iTunes and, of course, then the rise of streaming services like Spotify, we were staring in the abyss. We were staring at an industry that had its income decimated or its revenues decimated. and I think the alternative to legitimate streaming would have probably been the collapse of commercial music industry. And theft is so interesting.

23:55Yeah, it's a really almost counterintuitive thought. Even if people think they're not getting a good enough deal from Spotify is a big famous one, but whatever, streaming services, it's better than not getting anything, which is what piracy amounts to. Piracy is theft. Yes, and we've come a long way from that. But nonetheless, that should not negate the need for more income distribution to the creators, which is today even more under threat with the rise of AI-generated music. And by virtue of the fact that streaming services distribute revenues proportionate to plays, and the percentage of the overall pie, if you will, that your plays get, the more artificial intelligence created music exists, the more, even more those already limited incomes are shrinking.

24:55Just before we get to AI, what needs to be done? You said that as the Recording Academy, you know, you are the man ultimately who's in charge of the Grammys. You want to see creators compensated better for their great creations. How do you actually make that happen? How do you actually get a better deal for the people, as you say, who if we don't have them creating anything, we've got no music? It's legislation. It's advocacy. It's engagement with the technologists behind a lot of these firms. Also, we were about to talk about AI. I do believe that we do need to arrive to a point where there's transparency around what I'm consuming as a consumer.

25:43Of course. Is it human or has it been manufactured by the cognitive intelligence of a machine? It seems so basic that you'd need that kite mark. Yeah. I mean, look, when I go to the grocery store and I buy a jar of salsa, I can choose to get a, uh, one that's full of preservatives, uh, or I can choose to get a homemade one. Right. Um, but there's something that, uh, enables me to make that decision. And that is labeling, you know, might that exists so that, uh, with the, with the, with the products that I'm consuming from a content side, music or otherwise, that enables me to make an intelligent decision.

26:30So that's about the decision. As you said a moment ago, which is so interesting, if you get this explosion of content, AI-generated content, as you say, because attention is finite and content could be infinite, that squeezes the amount of time that people can give, listeners can give to particular artists. I'm just going to read for our wonderful listeners the beginning of an article on the BBC News website written by my brilliant colleagues on the 17th of January. Sienna Rose is having a good month. Three of her dusky jazz-infused soul songs are in Spotify's viral top 50. The most popular, a dreamy ballad called Into the Blue, has been played more than five million times.

27:10If she continues on this trajectory, Rose could become one of the year's hottest new stars. There's only one problem. All the signs are, all the signs indicate, sorry, she's not real. The story goes on. Streaming service Deezer, which has developed tools to tackle AI music, told the BBC that, and I quote, many of her albums and songs on the platform are detected and flagged as computer generated. Look closer and you'll see the indications of an AI artist. Rose has no social media presence, has never played a gig, has no videos, and has released an improbable number of songs in a short space of time.

27:46Panos, how big a threat to the music industry is AI? I think it's a massive threat. And look, there's also a big upside. We cannot downplay the threat that an artist like Sienna Rosa just described poses to the incomes of creators. And that is at the top of everybody's mind and certainly at the top of our mind as the Recording Academy. because of the economics that I described earlier. Well, the more streaming services are dominated by artists that are completely manufactured, well, it goes without saying, the less the incomes of human creators become. And there could also be a counter incentive by streaming services to necessarily identify AI music.

28:46Because if you don't have to pay somebody, then great, right? How fantastic. You don't even have to give Sienna royalties because there's no bank account. Who's, you know, is Sienna with NatWest? Is Sienna with HSBC? I dread a future where 99 % of the music on any of these streaming services is not human created. I don't want to experience that world. And if we're not... Is that world coming? I'd like to believe not. I'd like to believe that we will, as an industry, understand that that is not in the long-term benefit of everybody. So, you know, is there a world where perhaps functional music will be entirely AI-driven?

29:32Maybe. but no, I don't want to experience a world where the entirety of the catalogue that I'm accessing is somehow driven by machines. That's dystopia. Can I play the devil's advocate for a second? Is Sienna Rose not a net benefit for humanity in some way say there's some young panos in in cyprus or some younger mole i was born in calcutta in india who's really into the what was it the bbc said dusky i've not had the benefit of listening to sienna's music yet but into the um the sort of dusky jazz is it such a bad thing if sienna rose's music is giving pleasure fifth you know five million downloads it's giving pleasure to someone and it's new-ish music, albeit made from that rich soup of human data, which AI requires to feed it, is it such a bad thing?

30:30Bad for creators? Not so bad for music streamers? But, you know, 5 million people have got some pleasure from it. Is that so bad? I think so. You know, while I'll answer the question this way, and it's not because I'm some idealist, I think it's the equivalent of junk food. sure we derive pleasure by consuming all kinds of things that are bad for us i mean we were just talking before the start of this podcast about um social media um you know yes there's the line from the cheryl crow song if it makes you happy can't be that bad but you know that's a beautiful lyric written by an amazing artist.

31:15She's fantastic. But I'll push back and say, there's a lot of things that make us happy that are not good for us.

31:29I hope you're enjoying this conversation with Panos A. Panay, the president of the Recording Academy, which puts on the Grammys. If you are, please subscribe to this podcast on BBC Sounds. That way you won't miss future episodes. And if you do subscribe, just make sure you've got your push notifications turned on and that way you will get an alert whenever we publish a new episode and you will never miss out and if you really want if you really want to be a big and treasured member of our club go on give us a little five star review because it helps other people find our work thank you so much and now back to Panos A.

32:04Panay If journalism is the first draft of history what happens if that draft is flawed? In 1999, four Russian apartment buildings were bombed, hundreds killed. But even now, we still don't know for sure who did it. It's a mystery that sparked chilling theories. I'm Helena Merriman, and in a new BBC series, I'm talking to the reporters who first covered this story. What did they miss the first time? The History Bureau, Putin and the apartment bombs. Listen on bbc.com or wherever you get your podcasts.