Exclusive Interview: Fred McIntyre, VP Product, CBS Interactive

Posted by Chris McLellan | April 20, 2010 | 2,870 views

It’s been three years since US media giant CBS Interactive purchased London-based Last.Fm, and the pace of change at this digital music pioneer shows no signs of letting up. The Music Void’s Chris McLellan recently caught up with Fred McIntyre, VP of Product at CBS Interactive, to discuss his thoughts on digital music and his plans to secure Last.Fm’s place in the volatile landscape that is today’s digital music business.

Hello and welcome to The Music Void. Enjoying the London Spring so far?

Thanks Chris. I really do enjoy the time that I get to spend in London, it’s one of my favourite cities.

You’ve been in digital music virtually since it’s inception. How would you rate the progress the business has made since you began?

In 1998, when I left SPIN Magazine to go to an internet radio start-up, Spinner.com, people told me that I was crazy.

One of the most common things that I heard at the time was that people already had radios, tape decks and CD players, so why would anybody bother to listen to music on their computer? Today, for 8–18 year olds, digital music consumption on computers, devices & mobile phones represents nearly 2/3 of the activity compared with CDs or Radio.

Beyond this shift in consumption medium, there is also the fact that access to music is no longer constrained by the limitations and economics of the traditional physical distribution model, and so the amount of music available for consumption is considerably higher today than it was a decade ago. There is a lot more music for people to choose from today.

Over the past 12 years, the internet has completely transformed the way hundreds of millions of people discover, share, and consume music.

In 2010, the online music fan’s options are ever-expanding:

Digitized CD collections
Internet radio
Filesharing
Pay-to-download
Ad-supported streaming
Subscription services

And users are engaging across a variety of service models and devices:

Web applications
Desktop applications
Mobile phones
Internet-enabled stereo devices
Media and gaming centers

The only constant in this ecosystem has been rapid change and growth, and there’s no sign of it slowing down. Users are using multiple music products and services, and consuming music on their own terms.

With this expanded array of choices and options for listeners, there is real value in being able to give quality recommendations that help people sort through their options.

One of the things that excites me so much about what we’re doing at CBS in music is that we can engage with users and connect them with music across the spectrum of over the air radio, television, internet radio, editorial programming and personalized recommendations from Last.Fm.

What prospect excites you most in digital music right now?

Last.Fm.

For the past seven years, Last.Fm has worked to help users take control of their music listening and to save and reflect their taste across a multitude of services and platforms. This is unique in the market, and I believe that the numbers underscore the relevance of Last.Fm to users. For example:

Last.Fm grew at a healthy clip around the world in 2009. For example, Last.Fm doubled its audience in the US in 2009, and we have continued to build on that growth through Q1 2010.

According to the March ComScore Media Metrix numbers, for the 12 months ending March 2010, Last.Fm has registered year over year gains of 63%. Page Views averaged 97% growth, and Average Time On Site saw growth of 113%

By the end of 2009, Last.Fm had scrobbled over 38 Billion tracks. In 2010 we expect to add another 23 Billion scrobbles. Today at peak, we scrobble over 800 tracks per second.

I believe that Last.Fm is growing because we provide users with a service that is truly unique. By giving them the ability to record their digital music activity from over 600 services and applications, Last.Fm gives users umatchable insight and control over their music listening activity data. We also give users recommendations for events and new music as well as personalized radio.

With the site update that we’re starting to roll out this week, we are incorporating 3^rd party services like Spotify, HypeMachine and MOG more tightly into the Last.Fm experience with the goal of giving users more control over their music consumption experience. The goal is to integrate all services that scrobble, and as part of that we want to work with every music service in the market.

Founded in 2002, Last.Fm was an early entrant in digital music. What were the biggest challenges it faced as it went from start-up to maturing business?

The biggest challenges that Last.Fm has encountered stem from the fact that some product bets were made that did not pan out as planned, and these bets created some confusion around the brand with users. With the Free on Demand service, for example, Last.Fm found itself operating a product with low user adoption that caused brand confusion and created competition with companies that make more sense to have as partners.

How do you respond to people who point out that newer services such as Spotify and We7 have grabbed so much of the spotlight from Last.Fm?

In the UK, there is a notion that Last.Fm competes with companies like Spotify & We7 who provide on-demand services, but the fact of the matter is that we actually work with these companies as partners.

To address this misconception, we’re working hard to focus Last.Fm on the core product attributes that made us successful in the first place. Last.Fm has had brilliant success with scrobbling which has enabled tens of millions of people to engage socially around music, receive recommendations for new music and events and listen to personalized radio.

We’ve listened closely to feedback from our users, and we’ve come to the conclusion that they want more flexibility around consumption. They are generally engaged with multiple digital music services and applications, so there’s an opportunity for Last.Fm to help connect these experiences. We’re also focusing much more on building partnerships with companies like Shazam, Vevo, MOG, Spotify and We7, and our ultimate goal is to work with every music service and application.

I’d be remiss if I failed to highlight that Last.Fm has continued to grow at a very healthy clip over the last year as well. We believe that we can accelerate Last.Fm’s growth in 2010 by working closely with partners and this year we will be shipping a variety of features designed to make Last.Fm more valuable to them.

You’ve described ‘getting Last.Fm’s financial and organisation house in order’ as one of your first objectives. What will this entail exactly?

We are aligning Last.Fm’s cost structure for growth. The key is to bring focus to the product. We’re investing in core Last.Fm product capabilities like scrobbling, user profiles and data, recommendations for events and personalized radio. In each of these areas, Last.Fm has the kind of business that we can grow substantially.

On what levels will San Francisco and London employees co-operate? Will these cultures blend successfully in your view?

Last.Fm sits within the CBS Interactive Music Group, which is a joint venture between CBS Interactive and CBS Radio. The properties within the CBS Interactive Music Group include Last.Fm, Mp3.com, the websites for 90 CBS Radio music stations on Radio.com as well as the streaming radio platform that powers AOL Radio, CBS Radio and Yahoo! Radio in the US. CBS Interactive Music has employees in London, New York, Los Angeles, San Francisco in addition the field staff in 28 CBS Radio Markets.

Last.Fm is essential to the strategy that we are executing for the CBS Interactive Music Group. We already use Last.Fm data, event and artist information extensively on Radio.com, the Radio.com iPad app which we shipped last week features integrated Scrobbling and over the course of this year we will be integrating Scrobbling as well as Personalized Radio into the streaming radio platform. One of our goals is to grow Last.Fm’s audience in the US in 2010, and we see deeper integration across CBS Interactive Music products combined with 3^rd party partnerships as important parts of how we hit this goal.

Last.Fm has a solid footprint in the US (9m+ of its 40m users). How do you view the threat posed by newer services such as Mog and Rdio there, and how are you preparing for Spotify’s imminent US launch?

Thanks for acknowledging Last.Fm’s audience in the US. We saw tremendous growth in the US in 2009, and we’ve been able to keep up the pace through Q1. According to the March ComScore Media Metrix numbers, For the 12 months ending March 2010, Last.Fm has registered year over year gains of 63% on a monthly basis. Page Views averaged 97% growth, and Average Time On Site saw growth of 113%.

The goal for Last.Fm is to work with every music service and application in the market, and so we don’t see any of the companies you’ve mentioned as competitors. For example, as we announced this week, MOG & Spotify are partners. Since the start of this year, Last.Fm has announced scrobbling partnerships with companies like Shazam, Vevo, MOG, HypeMachine, Spotify and We7, and we are working to add more partners every day.

We’ve looked more closely at feedback from users, and we’ve come to the conclusion that they are generally engaged with multiple services and applications and therefore want more flexibility around consumption, so there is an opportunity for Last.Fm to help connect these experiences.

The logic is simple: partners integrate Last.Fm Scrobbling and they get exposure to Last.Fm’s audience of 40M users around the world as well as the benefit of increased user satisfaction and engagement. Over the course of 2010, we will be deploying features and functionality designed to make Last.Fm even more valuable to partners.

What is next for you and Last. Fm? What are we likely to be discussing the next time we speak?

Partnerships, Growth, Radio & Mobile

Fred McIntyre of CBS Interactive and Last.Fm, thank you for speaking with The Music Void today.

It’s been a pleasure.

This is the first in a series of several interviews that Chris McLellan will be holding with Fred McIntyre to explore the evolving strategy inside of one digital music’s most iconic and pioneering brands.

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Posted by Chris McLellan on Apr 20 2010. Filed under Digital, featured, Gadget & Services. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

Exclusive Interview: Fred McIntyre, VP Product, CBS Interactive

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