Hitting the Right Note with SoundCloud

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SoundCloud recently announced they appointed Merritt Farren as its new General Counsel.

As General Counsel, Farren is responsible for shaping and defining SoundCloud’s legal affairs and public policy strategy, in addition to leading its team of legal experts across the areas of data protection and privacy, commercial contracts, music rights, copyright issues and corporate matters.

Prior to SoundCloud, Farren was Chief Legal Officer at Amazon’s Audible.com. Before joining the Audible team, he was Associate General Counsel, Digital Media and New Technologies at Amazon.com where he helped Amazon launch digital video, digital music, eBooks and Kindle. Farren’s diverse background also included roles at educational internet company Lightspan, Sony Pictures, Paris law firm Duclos, Thorne and The Walt Disney Company where, among other things, he lead the legal effort on the launch of Disney Interactive.

Meritt’s vast experience has enabled him to guide his way through complex legal issues, whilst allowing businesses to grow and expand. In this exclusive interview, we have the pleasure of speaking with Merritt about his plans for SoundCloud, what he expects to challenge him and his previous experience at Sony and Disney. Merritt also reveals his favourite legal sector, as well as the legal issues he has overcome throughout his professional years.

 

What goals do you wish to achieve now you have been appointed General Counsel of SoundCloud?

SoundCloud is a truly unique global company that reaches over 175 million passionate music fans every month. We are embraced by both artists and creators who appreciate the way we enable them to connect with fans. We have both user-generated content and content licensed from record labels, giving listeners the ability to discover music they can’t find anywhere else as well as listen to recordings they already know and love.

As SoundCloud continues to grow and innovate, my goal is to support my team and provide the highest quality, most business-oriented, creative legal support possible.

 

What do you foresee as the most challenging aspect of your role?

SoundCloud’s business is extremely complex and the legal issues we work with are varied. We work across a wide set of domains, many of which are entirely new to us as an organisation. Combined with having a small team, means efficiency and creativity in what we do is crucial to our success.

 

Can you tell Lawyer Monthly what you think produces a successful General Counsel? What pieces of advice would you offer those who are inspiring to be legal experts?

The overall key is the support of a strong team and I’m fortunate to have that at SoundCloud.  We have a small, but flexible, creative team with experience in handling a varied workload.

Beyond that, we need to be experts in each of the core domains in we practice day-to-day. Dealing with issues we see regularly from so many different angles and with such frequency can really hone our expertise. Acknowledging that we can’t be experts in everything we deal with and, instead, consulting regularly with external counsel who are. We’re supported by a set of amazing lawyers around the globe and couldn’t fulfil our roles effectively without their assistance.

Being highly business-oriented and deeply integrated with the business teams is crucial. We’re part of one SoundCloud team and are as focused on business goals just as our team members outside legal are. We look for ways to push the business forward and enable innovation that serves our listeners and creators with as much enthusiasm and dedication as our non-legal business colleagues.

Constantly inventing and reinventing is important, particularly in a business such as ours which is still fairly new and continuously growing. Startups like SoundCloud are the ideal places for lawyer inventors and entrepreneurs looking to innovate.

 

Out of all the various legal affairs you deal with, from copyrighting to contracts, which are your favourite and why?

I truly love the law and complex legal issues. I’ve had the opportunity to deal with a wide range of legal issues over the course of my career, and I can honestly say that I’ve found them all interesting.

That said, I have a special love of copyright. It’s complex, like other areas of the law, and I love it for that. There are two things that I especially love about it: it’s purpose, and the unique nature of “property right” that copyright creates. Copyright’s fundamental purpose is to support the creation and dissemination of artistic works for the betterment of society, and in the recognition of the crucial role that artistic works and expression play in making a better society. Copyright is not a simple property right but has, at the heart of it, a balance between the interest of artists and the interests of consumers, plus, society in the active and widespread distribution of artistic works. Copyright Law demands a degree of creativity that mirrors the work it protects, and I love that.

It is especially true in music, where copyright law has long had within it a set of statutory rights (or their equivalent) that allow for access to music without the need for individual licenses. It is designed in such a way that ensures the monopoly inherent in copyright doesn’t allow individual rights holders to work against the collective good of artists generally and the greater good of society.

 

When an international company has plans to expand and evolve, as General Counsel, how do you deal with all the legal matters at hand and ensure the company adheres to the law in all jurisdictions it is involved with?

This is one of our bigger challenges. As we expand, we use our knowledge and understanding of areas where we have experience with the issues we’ll face in the jurisdictions we’re already in, and identify the deltas. For the deltas, we look at the issues that might be unique and play out differently for us in that new jurisdiction. In doing that, we look for best practice employed by others and seek advice from local counsel.

 

What do you think is an effective way for music artists and companies to ensure their work is secure and not illegally obtained?

What we find most interesting and encouraging on that front is that surveys show young listeners, when compared to their older peers, are more respectful of artists and empathetic about artists’ right and the need for them to be compensated. They are also more willing to pay for music. That’s a great development which we attribute to three points (and all of these we enable at SoundCloud): (i) engage listeners actively in a way that allows them to be both listeners and artists and in a way that enables listeners to see themselves as artists; (ii) enable authentic communication between listeners and artists that creates a genuine, “non-commercial” bond; and (iii) don’t fight listeners on what they want. They want new takes on existing songs and creative experimentation in expression. Don’t fight that, embrace it as SoundCloud does.

 

With the digital scope everchanging, where do you hope to see the industry heading? What legislative changes do you think will help account towards this?

You can expect to see us continue to roll out innovative, new ways to engage creators and listeners and enable artists to make money. We will have to overcome challenges, and it will take time before we’re done on that front, but we’re confident that we can get there.

In terms of legislation, we’re very happy to see some creativity coming out of Brussels right now from some very forward-thinking members of parliament. Legislators get criticised a lot for being out of touch and not being expansive in their thinking, but we see a genuine effort to understand real world challenges and keep the EU ahead in copyright innovation.

You helped to launch Amazon’s digital video, music and eBooks; what challenges did you face along the way and how did you overcome these?

Along with a host of consumer protection issues, consumer data items and other matters that come with launching digital consumer services around the globe, digital media efforts inevitably require a large licensing effort. On that front, I would say the key to making progress was getting content rights holders to understand three things: (i) why the innovation we wanted to roll out would be good for them and their industry (we launched all of our services with at least one big innovation); (ii) why Amazon is different from some other content distributors they had dealt with, and why our systems simply wouldn’t allow us to agree to certain things others had, like a right to review specific ‘pages’ on which their content might be offered, since our site was dynamically generated for each customer; and (iii) how, once they saw beyond those first two things, we really could – and would – be very good long term partners to them and respectful of their needs as well as ours.

 

How have all your digital launches differed; from Disney to Sony, what different legal difficulties did you face and solve?

There has been a variety of issues. At Disney, one of the more fun jobs was figuring out how to translate talent deal compensation constructs used in feature film and TV for platform games and online. Our approach was to look for the softest bridge we could find to keep talent comfortable. At Sony, I worked with a team of lawyers and business team members from multiple studios to create a business model for replacing physical film use in theatrical feature film distribution, with the use of digital projection. Among our challenges was how to compensate theatre owners for the cost of installing digital projectors that would generate cost savings to studios; this was a great challenge to work through and solve.

 

Is there anything else you would like to add?

2017 is set to be the biggest, most ambitious, year for SoundCloud yet. Amongst other things, we’ll be expanding our subscription service into further territories around the world and will be releasing new product features to improve the SoundCloud experience for everyone. It’s a really exciting time for us and I’m delighted to be a part of it.

 

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