“OWC’s consultants were highly professional. I was especially impressed by how quickly they picked up on the highly complex work done by GEMA and how they were able to integrate these insights into their task.”
Christian Seitz, Director Licensing at GEMA
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Christian Seitz Director Licensing at GEMA (photo: private collection) |
Dr Stefan A. Duvvuri Owner of Duvvuri Consulting Internal Audit Liaison Manager at GEMA (photo: private collection) |
Dr Maximilian Fischer Data Scientist at Old World Computing (photo: private collection) |
Composers and lyricists – the authors of musical works – as well as music publishers are united under GEMA’s umbrella. GEMA, a collective management organization, manages remuneration claims and entitlements of its members at a global level, wherever their copyright-protected musical works are used. At the same time, it is active in numerous funding projects for a diverse musical culture. It stands up and campaigns on behalf of its members in the political arena to ensure copyright is appreciated in the future; it also contributes to increasing society’s awareness for the value of creative undertakings. It is not just some 72,000 GEMA members that benefit from GEMA’s activities; in fact, nearly two million rights owners from all over the world also enjoy these benefits by virtue of representation agreements GEMA has concluded with collective management organizations from other countries. François Baumgartner, head of communications and marketing at Old World Computing, talked to Christian Seitz, director licensing at GEMA, Dr Stefan A. Duvvuri, owner of Duvvuri Consulting and Internal Audit Liaison Manager at GEMA, as well as Dr Maximilian Fischer, data scientist at Old World Computing. They discussed project management, customer enthusiasm, and recommendations by partners in the music industry.
Mr Seitz, digitalization and social media have fundamentally changed the music business. From an artist’s perspective, please elaborate on why he or she should stay a GEMA member.
Christian Seitz, director licensing at GEMA:
The music business has been undergoing a continuous transformation process for years, strongly propelled by digitalization. Changing usage behaviors, new distribution channels, and disruptive technologies have turned many things upside down. Especially in these uncertain times, creative minds need a strong partner at their side. As a collective management organization, GEMA acts as trustee managing rights of use, ensuring musicians receive fair remuneration for the public use of their works protected by copyright. In times shaped by social media and digital forms of music usage, this is more important than ever. A single musician will have a hard time asserting his or her rights and entitlement to compensation against for example YouTube. With its 72,000 members, however, GEMA has significantly more leverage, and our members can count on that. Additionally, GEMA represents the interests of creators of music towards the general public as well as in politics, seeing to their legal rights in digital times.
Dr Duvvuri, what does Duvvuri Consulting represent?
Dr Stefan A. Duvvuri, owner of Duvvuri Consulting:
Duvvuri Consulting offers managed services in finance and corporate governance. This includes conception, and implementation support, as well as attending to outsourced tasks such as internal audit and controlling. Furthermore, we support customers regarding digital transformation, from a first survey of the status quo, to developing a strategy for digitalization, to deriving and implementing a valid transformation road map.
What else characterizes your consultancy?
Dr Stefan A. Duvvuri, owner of Duvvuri Consulting:
We see ourselves as sparring partners to our customers, meaning we provide neutral information and an independent perspective for managers, CEOs, or business owners, enabling them to make expedient decisions. We act as the hinge connecting our customers and business consultants, investors, or banks, with the goal to achieve the best possible decision from the perspective of our customer.
Mr Duvvuri, you have been a consultant to GEMA for many years. What exactly do you do there?
Dr Stefan A. Duvvuri, owner of Duvvuri Consulting:
For GEMA, I work as internal audit liaison manager within a managed services assignment. Besides planning, carrying out, and managing the internal revision, I present new trends and technologies to GEMA, gauging their areas of application, thus demonstrating their operative benefits. Since GEMA have a considerable amount of data at their disposal, a big data solution seemed obvious. The starting position as well as the GEMA’s readiness for data driven, proactive, and internal management models were to be tested within the scope of a pilot project.
Fan culture, customer enthusiasm, and recommendations are integral parts of success in the music business. But how can an artist achieve sustained success?
Christian Seitz, director licensing at GEMA:
Nowadays, positive customer experiences as well as enough likes and follower are certainly factors to success that should be taken seriously. New media offer the possibility for new creators of music to gain a large audience quickly, at least for those standing on the stage as singer-songwriter. But a large audience in social networks only rarely reflects in high, or rather, fair remuneration. YouTube, Instagram, Facebook, and Twitter undeniably offer many marketing opportunities. However, 100,000 recordings sold still generate significantly higher income for the creator than 100,000 video views do. On the one hand, this is connected to the customer’s willingness to pay. On the other hand, and more importantly, this is a legal matter: it works great in the analog world, but does not happen in the digital world. The EU is currently debating an amendment to copyright law, a step long overdue. Until now, digital companies earned millions by making content protected by copyright accessible on their platforms without fair pay for the creators. It is about time the EU set robust boundaries for the global internet giants, protecting Europe’s creative minds. The GEMA is committed to ensuring creative works is not devalued.
Mr Seitz, what do you look for in project partnerships?
Christian Seitz, director licensing at GEMA:
GEMA is always interested in innovations, therefore we also focus on questions such as: “How can we improve our processes and our performance and increase the benefits for our members?” “Considering the large number of members and customers, how can we design efficient services and optimize these?” And: “How can we, an organization heavily driven by data, cope with the continuously increasing amounts of data digital music consumption brings with it.” For all these questions, the perspective of our customer or member is paramount for us. To be able to also consistently take up an outsider’s position, external partners are crucial. And if these partners also share the love for everything creative, that’s half the battle.
Why is data science so important for GEMA in particular?
Christian Seitz, director licensing at GEMA:
Because we are a data driven organization, we rely on a digitizable and efficient value creation process, beginning with the documentation of our customer and member data, to the mass processing of the music usage data, and ending with the distribution of royalties to our members. Therefore, data science is no uncharted territory to us, but established practice. Pivotal is then how we are able to profitably integrate the insights gained to professionalize processes and offers for our customers and members. The whole topic area harbors immense potential and gets you excited for future processes and procedures.
Why did GEMA decide on a collaboration with Old World Computing and how was the contact established?
Christian Seitz, director licensing at GEMA:
Dr Duvvuri initiated the contact. He has known GEMA for years. Moreover, the idea had me convinced right from the start.
Dr Stefan A. Duvvuri, owner of Duvvuri Consulting:
Old World Computing is one of my preferred networking partners. I recommended OWC because they have long-standing experience in the area of data science, because they have an excellent team, and because from the beginning are very focused on identifying an deployable use case. This is a big factor for the success of a project. What tipped the scales for me was that Old World Computing is willing to discontinue a project, if no valid results can be expected. Consistent action prevents overblown or wrong expectations about the results of a pilot project, which can lead to significant frustration during the deployment phase and in extreme cases might even banish the topic of predictive analytics in that organization for years to come.
What was the concrete project order?
Christian Seitz, director licensing at GEMA:
GEMA wanted to test the implementation of predictive analytics within the scope of a pilot project. Because of the data acquisition and processing as well as the resulting large amount of data within one IT system, a GEMA field service was selected for this undertaking. The project extended from evaluating potential use cases to the development of a prediction model with the aim to identify and develop a use case for predictive analytics. The question was whether customer complaints – such as regarding a specific bill amount, or a specific group of customers – could be predicted in order to derive from these insights, i.e. prediction models or data patterns, recommendations for actions for the operative business.
How could this work?
Dr Maximilian Fischer, data scientist at Old World Computing:
The aim of any predictive analytics project is predicting future events, in this case whether a bill will lead to a complaint. This way, an employee receives a warning when drawing up the bill that it will lead to a complaint and is therefore able to recheck the bill’s content. If a complaint can be prevented like this, it saves everybody’s time and nerves.
Is that it?
Dr Maximilian Fischer, data scientist at Old World Computing:
On our side, the project consisted of data preprocessing, training and optimizing the machine learning processes and validating the results. In the end, the validation showed that using a gradient boosted tree algorithm, we were able to efficiently and accurately predict complaints.
Were there further challenges?
Dr Maximilian Fischer, data scientist at Old World Computing:
By maintaining a comprehensive database, GEMA provided an excellent base for our work. First and foremost, our work was the day-to-day craft of a data scientist. Besides these technical aspects, it is of course important to communicate with the client. Especially for predictive analytics projects, it is important to get across what can be achieved by applying predictive methods, but also what cannot be achieved.
What was the timeframe for the project?
Dr Maximilian Fischer, data scientist at Old World Computing:
We had scheduled 25 consulting days in the period of November 2017 to March 2018. All of those were budgeted by GEMA and made use of.
Which insights have you gained from the pilot project?
Christian Seitz, director licensing at GEMA:
On the one hand we were looking for quick access and potential use cases for practical application. There is an incredible potential in the exploitation of these predictions for GEMA. Nowadays it isn’t enough to focus on handling day-to-day business. In fact, we have to deal with new technologies and seize the opportunities of digitalization to be able to work as efficiently as possible for our customers and members. Additionally, we now know that there is still room for improvement with the data model, making our analyses even more exact.
What are the next steps after the end of the pilot project?
Christian Seitz, director licensing at GEMA:
After finishing the pilot project, we will at first discuss the insights internally. The pilot is not yet ready for series production, and we have to take the proper preparations to put it into practice.
Were you satisfied with the pilot project?
Christian Seitz, director licensing at GEMA:
I was very satisfied with the pilot project. For me this really was uncharted territory, and I am surprised by what is possible with data science. I can imagine further possible applications for our business.
… On a scale from 1 to 10?
Christian Seitz, director licensing at GEMA:
A nine. OWC’s consultants were highly professional. I was especially impressed by how quickly they picked up on the highly complex work done by GEMA and how they were able to integrate these insights into their task.
Dr Fischer, how do you feel about the collaboration?
Dr Maximilian Fischer, data scientist at Old World Computing:
Everybody at GEMA was very open for the topic of data science and interested in reducing the number of complaints and cancellation for the license holders. That makes them a pleasant customer for us as service providers and also creates a high potential for GEMA to profit from the integration of data science into their business processes on a long-term basis.
Considering the experiences you had as well as the result of the project, would you recommend Old World Computing and why?
Christian Seitz, director licensing at GEMA:
I would and will recommend Old World Computing and can only advise all companies to deal with this issue early on.
Thank you.
