Tribe of Noise
The twenty-four case studies in Made with CC were chosen from hundreds of nominations received from Kickstarter backers, Creative Commons staff, and the global Creative Commons community.
We did background research and conducted interviews for each case study, based on the same set of basic questions about the endeavor. The idea for each case study is to tell the story about the endeavor and the role sharing plays within it, largely the way in which it was told to us by those we interviewed.
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Tribe of Noise is a for-profit online music platform serving the film, TV, video, gaming, and in-store-media industries. Founded in 2008 in the Netherlands.
Revenue model: charging a transaction fee
Interview date: January 26, 2016
Interviewee: Hessel van Oorschot, cofounder
Profile written by Paul Stacey
In the early 2000s, Hessel van Oorschot was an entrepreneur running a business where he coached other midsize entrepreneurs how to create an online business. He also coauthored a number of workbooks for small- to medium-size enterprises to use to optimize their business for the Web. Through this early work, Hessel became familiar with the principles of open licensing, including the use of open-source software and Creative Commons.
In 2005, Hessel and Sandra Brandenburg launched a niche video-production initiative. Almost immediately, they ran into issues around finding and licensing music tracks. All they could find was standard, cold stock-music. They thought of looking up websites where you could license music directly from the musician without going through record labels or agents. But in 2005, the ability to directly license music from a rights holder was not readily available.
They hired two lawyers to investigate further, and while they uncovered five or six examples, Hessel found the business models lacking. The lawyers expressed interest in being their legal team should they decide to pursue this as an entrepreneurial opportunity. Hessel says, “When lawyers are interested in a venture like this, you might have something special.” So after some more research, in early 2008, Hessel and Sandra decided to build a platform.
Building a platform posed a real chicken-and-egg problem. The platform had to build an online community of music-rights holders and, at the same time, provide the community with information and ideas about how the new economy works. Community willingness to try new music business models requires a trust relationship.
In July 2008, Tribe of Noise opened its virtual doors with a couple hundred musicians willing to use the CC BY-SA license (Attribution-ShareAlike) for a limited part of their repertoire. The two entrepreneurs wanted to take the pain away for media makers who wanted to license music and solve the problems the two had personally experienced finding this music.
As they were growing the community, Hessel got a phone call from a company that made in-store music playlists asking if they had enough music licensed with Creative Commons that they could use. Stores need quality, good-listening music but not necessarily hits, a bit like a radio show without the DJ. This opened a new opportunity for Tribe of Noise. They started their In-store Music Service, using music (licensed with CC BY-SA) uploaded by the Tribe of Noise community of musicians.1
In most countries, artists, authors, and musicians join a collecting society that manages the licensing and helps collect the royalties. Copyright collecting societies in the European Union usually hold monopolies in their respective national markets. In addition, they require their members to transfer exclusive administration rights to them of all of their works. This complicates the picture for Tribe of Noise, who wants to represent artists, or at least a portion of their repertoire. Hessel and his legal team reached out to collecting societies, starting with those in the Netherlands. What would be the best legal way forward that would respect the wishes of composers and musicians who’d be interested in trying out new models like the In-store Music Service? Collecting societies at first were hesitant and said no, but Tribe of Noise persisted arguing that they primarily work with unknown artists and provide them exposure in parts of the world where they don’t get airtime normally and a source of revenue — and this convinced them that it was OK. However, Hessel says, “We are still fighting for a good cause every single day.”
Instead of building a large sales force, Tribe of Noise partnered with big organizations who have lots of clients and can act as a kind of Tribe of Noise reseller. The largest telecom network in the Netherlands, for example, sells Tribe’s In-store Music Service subscriptions to their business clients, which include fashion retailers and fitness centers. They have a similar deal with the leading trade association representing hotels and restaurants in the country. Hessel hopes to “copy and paste” this service into other countries where collecting societies understand what you can do with Creative Commons. Outside of the Netherlands, early adoptions have happened in Scandinavia, Belgium, and the U.S.
Tribe of Noise doesn’t pay the musicians up front; they get paid when their music ends up in Tribe of Noise’s in-store music channels. The musicians’ share is 42.5 percent. It’s not uncommon in a traditional model for the artist to get only 5 to 10 percent, so a share of over 40 percent is a significantly better deal. Here’s how they give an example on their website:
A few of your songs [licensed with CC BY-SA], for example five in total, are selected for a bespoke in-store music channel broadcasting at a large retailer with 1,000 stores nationwide. In this case the overall playlist contains 350 songs so the musician’s share is 5/350 = 1.43%. The license fee agreed with this retailer is US$12 per month per play-out. So if 42.5% is shared with the Tribe musicians in this playlist and your share is 1.43%, you end up with US$12 * 1000 stores * 0.425 * 0.0143 = US$73 per month.2
Tribe of Noise has another model that does not involve Creative Commons. In a survey with members, most said they liked the exposure using Creative Commons gets them and the way it lets them reach out to others to share and remix. However, they had a bit of a mental struggle with Creative Commons licenses being perpetual. A lot of musicians have the mind-set that one day one of their songs may become an overnight hit. If that happened the CC BY-SA license would preclude them getting rich off the sale of that song.
Hessel’s legal team took this feedback and created a second model and separate area of the platform called Tribe of Noise Pro. Songs uploaded to Tribe of Noise Pro aren’t Creative Commons licensed; Tribe of Noise has instead created a “nonexclusive exploitation” contract, similar to a Creative Commons license but allowing musicians to opt out whenever they want. When you opt out, Tribe of Noise agrees to take your music off the Tribe of Noise platform within one to two months. This lets the musician reuse their song for a better deal.
Tribe of Noise Pro is primarily geared toward media makers who are looking for music. If they buy a license from this catalog, they don’t have to state the name of the creator; they just license the song for a specific amount. This is a big plus for media makers. And musicians can pull their repertoire at any time. Hessel sees this as a more direct and clean deal.
Lots of Tribe of Noise musicians upload songs to both Tribe of Noise Pro and the community area of Tribe of Noises. There aren’t that many artists who upload only to Tribe of Noise Pro, which has a smaller repertoire of music than the community area.
Hessel sees the two as complementary. Both are needed for the model to work.
With a whole generation of musicians interested in the sharing economy, the community area of Tribe of Noise is where they can build trust, create exposure, and generate money.
And after that, musicians may become more interested in exploring other models like Tribe of Noise Pro.
Every musician who joins Tribe of Noise gets their own home page and free unlimited Web space to upload as much of their own music as they like. Tribe of Noise is also a social network; fellow musicians and professionals can vote for, comment on, and like your music. Community managers interact with and support members, and music supervisors pick and choose from the uploaded songs for in-store play or to promote them to media producers. Members really like having people working for the platform who truly engage with them.
Another way Tribe of Noise creates community and interest is with contests, which are organized in partnership with Tribe of Noise clients. The client specifies what they want, and any member can submit a song. Contests usually involve prizes, exposure, and money. In addition to building member engagement, contests help members learn how to work with clients: listening to them, understanding what they want, and creating a song to meet that need.
Tribe of Noise now has twenty-seven thousand members from 192 countries, and many are exploring do-it-yourself models for generating revenue. Some came from music labels and publishers, having gone through the traditional way of music licensing and now seeing if this new model makes sense for them. Others are young musicians, who grew up with a DIY mentality and see little reason to sign with a third party or hand over some of the control. Still a small but growing group of Tribe members are pursuing a hybrid model by licensing some of their songs under CC BY-SA and opting in others with collecting societies like
ASCAP or BMI.
It’s not uncommon for performance-rights organizations, record labels, or music publishers to sign contracts with musicians based on exclusivity. Such an arrangement prevents those musicians from uploading their music to Tribe of Noise. In the United States, you can have a collecting society handle only some of your tracks, whereas in many countries in Europe, a collecting society prefers to represent your entire repertoire (although the European Commission is making some changes). Tribe of Noise deals with this issue all the time and gives you a warning whenever you upload a song. If collecting societies are willing to be open and flexible and do the most they can for their members, then they can consider organizations like Tribe of Noise as a nice add-on, generating more exposure and revenue for the musicians they represent. So far, Tribe of Noise has been able to make all this work without litigation.
For Hessel the key to Tribe of Noise’s success is trust. The fact that Creative Commons licenses work the same way all over the world and have been translated into all languages really helps build that trust. Tribe of Noise believes in creating a model where they work together with musicians. They can only do that if they have a live and kicking community, with people who think that the Tribe of Noise team has their best interests in mind. Creative Commons makes it possible to create a new business model for music, a model that’s based on trust.
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