[A2k] Lunch with the FT: Paul McGuinness

[Thiru Balasubramaniam]

http://www.ft.com/cms/s/2/8c1788d2-e059-11de-8494-00144feab49a.html

<SNIP>

Unusually, McGuinness negotiated an equal share for himself. Do you
still get 20 per cent, I ask? Apparently not. =93That was, in fact,
reviewed later,=94 he says. =93I had to build the management company, and
they had to build the production organisation that makes the records
and does the tours. If our overheads were going to be intertwined,
that would be to ignore the reality. There should always be a division
between client and manager.=94

Those rights McGuinness did not secure for the band at the start, he
doggedly clawed back as deals came up for renewal, using the band=92s
strengthened negotiating position.

=93It was partly a moral thing,=94 he says, sounding for the first time a
little like Bono. =93You=92d see a writer complain helplessly when his
work was used in an inappropriate way, and we were determined that
would never happen to us.=94

<SNIP>

McGuinness has emerged as a vocal campaigner for internet service
providers to pay up for the music consumed over their networks, an
idea that has gained support since he raised it in a speech two years
ago. Publishers=92 drive to be paid for their content, symbolised by
Rupert Murdoch=92s talk of online subscriptions, has helped, he notes,
although he says it is a pity that the News Corp chairman=92s =93road to
Damascus conversion=94 did not take place sooner.

So why give away valuable content, such as a concert, online? =93We
don=92t quite give it away,=94 he corrects me. YouTube will pay royalties
to Universal Music, U2=92s record label and publisher, and share
advertising revenues. It is pointless to try to stop fans posting
concert clips online, he argues. What is possible, he says, is to
expect ISPs to pay rights holders their dues.


<SNIP>

=93As the EU expands, it is clearly the case that these small,
peripheral nations have no significant cultural heritage to protect in
an international context, whereas Germany, France, Britain and Ireland
certainly do,=94 he says bluntly, in an accent more English than Irish.
=93When the Czech Republic held the EU presidency, for example, simply
by not tabling a motion on [copyright] term extension, they were able
to defeat it. The Czechs!=94

<SNIP>

Don=92t such tricks help explain why people feel labels are just getting
their comeuppance? =93All right, it=92s been the law of the jungle many
times,=94 McGuinness says as our drinks arrive. =93But what dismays me a
little about the online universe is that these corporations, like
Google and MySpace and Apple, don=92t have anything that=92s the
equivalent of artist relations.=94

One day, tech groups will have their own talent scouts and digital
versions of record labels, he predicts. For now, the =93great cultural
collisions=94 taking place worry him. =93I find I=92m often dealing with
[technology] executives who are really quite careless and frequently
arrogant about the cultural impact of what they=92re doing. I wish there
were an atmosphere of nurturing and respect, which I really don=92t see.=94

----------------

Lunch with the FT: Paul McGuinness

By Andrew Edgecliffe-Johnson

Published: December 4 2009 15:28 | Last updated: December 4 2009 15:28

Paul McGuinness=93I figured out bad wine costs the same as good wine, so
why not learn about it,=94 says Paul McGuinness as he orders a $69
bottle of Oregon pinot noir. =93I probably imposed that on the young U2.
We had a practice when we were first touring. We=92d economise on hotels
but go to good restaurants.=94

More than three decades and 140m records after McGuinness, now 58,
started managing four Dublin teenagers, the world=92s most successful
band stay in rather better hotels and he has been able to put his
money where his mouth is, as an early investor in the Michelin-starred
Manhattan restaurant where we now sit.

It has taken us three hours to get to our corner table in the Spotted
Pig, which feels more of a village inn than the London gastropubs it
is supposed to resemble. McGuinness had suggested we meet first at
Madison Square Garden to watch U2 rehearse for the Rock and Roll Hall
of Fame=92s 25th anniversary show.

In an almost empty arena, I have been granted a private concert and a
glimpse of why McGuinness is one of the few people in the miserable
modern music industry to be noted for their business acumen.

Jon Landau, Bruce Springsteen=92s manager since 1974, approaches as we
watch U2 warm up. =93The thing I dislike about Paul is, before he came
along, I liked to think I was the best manager in the world,=94 he
jokes. =93Now Bruce likes to say, =91I call my manager the American Paul
McGuinness.=92=94

Elvis had Colonel Tom Parker, and John, Paul, George and Ringo had
Brian Epstein. McGuinness is U2=92s fifth Beatle. He claims no creative
role but can take credit for a series of eye-catching deals that have
led to U2-branded iPods, 3D concert films, a 12-year touring deal with
Live Nation, sponsorship from BlackBerry and, just before we meet, the
first concert streamed live on YouTube, which was seen by 10m people
around the world. Most importantly, Landau adds, McGuinness locked
down the band=92s master recordings and lucrative publishing rights.

On stage, I have watched Bono, the Edge, Adam Clayton and Larry Mullen
run through a lengthy set with guests including Springsteen and Patti
Smith. Mick Jagger, the only man who competes with U2=92s stadium-
filling ability, has prowled about the stage with Fergie, the lead
singer with the Black Eyed Peas. She has floored everybody with a
scorching assault on the opening bars of =93Gimme Shelter=94.

=93Holy cow, Batgirl!=94 Bono says when she=92s finished gyrating. The Blac=
k
Eyed Peas supported U2 at the end of the tour that has wrapped up days
before we meet, and McGuinness calls out, =93Nailed it!=94 as the leather-
clad vocalist walks past, earning a grin from behind her shades.
=93She=92s notorious and scary and a lot of fun,=94 he tells me approvingly
before we leave.

It is almost 3pm when our car draws up outside the small creeper-clad
corner site in the West Village. The Spotted Pig is packed, we are
famished, and McGuinness wastes little time in steering me to the best-
known dish. =93The gnudi!=94 He pronounces it =96 the =93g=94 is silent =96=
 with
naughty relish. In his striped wool tie, black shirt and corduroy
jacket, McGuinness doesn=92t look as if he hangs out with rock stars but
he does look as if he enjoys his food.

There is a chill in the air, and the pumpkin and serrano ham salad
sounds comforting, so I order that followed by the gnudi =96 plump
dumplings stuffed with ricotta. McGuinness picks smoked haddock
chowder and gnudi.

Like most of his deals, his involvement with the restaurant has paid
off. =93It has long since repaid its syndicate of investors,=94 he says.
=93It=92s a combination of the atmosphere, the decor, the pricing, which
is low for a Michelin-starred restaurant, and the very
straightforward, English approach to the food.=94

He sniffs the wine unfussily as he tells me how he got involved
through the Spotted Pig=92s co-owner, Ken Friedman, a one-time manager
of the Smiths and a close friend. McGuinness, it turns out, is a man
of many useful friends. (As he runs me through the story of how he
came to U2 he loses me in a list of names as long as the cast of an
Irish Russian novel).

McGuinness met U2 at a Dublin gig in 1978 =96 they were supporting a
band his sister managed. =93They were doing quite badly what they now do
well,=94 he says. =93Edge was playing notes rather than chords =96 this was
punk and it was almost frowned upon to be playing individual melodies.
Bono was very keen to make eye contact, and physical contact
sometimes, with the audience. He was very hungry for making them look
at him. He was then and is now an exhibitionist, as all great
performers ought to be. It was just quite exceptional.=94

McGuinness, who was managing a now forgotten folk rock band named
Spud, signed them up in the pub next door, over pints the band members
were too young to be drinking, and laid down some business rules. =93I
recommended very strongly that they split everything because I=92d read
about other bands where there were officers and men =96 the Rolling
Stones being a classic example, and the Beatles =96 where the
songwriting members of the group earned significantly more than the
others.=94

 From their first deal, all four were credited as writers. =93It has
stood them in very good stead because it backs up the democracy of a
decision if everyone=92s making the same amount of money,=94 McGuinness
says.

Unusually, McGuinness negotiated an equal share for himself. Do you
still get 20 per cent, I ask? Apparently not. =93That was, in fact,
reviewed later,=94 he says. =93I had to build the management company, and
they had to build the production organisation that makes the records
and does the tours. If our overheads were going to be intertwined,
that would be to ignore the reality. There should always be a division
between client and manager.=94

Those rights McGuinness did not secure for the band at the start, he
doggedly clawed back as deals came up for renewal, using the band=92s
strengthened negotiating position.

=93It was partly a moral thing,=94 he says, sounding for the first time a
little like Bono. =93You=92d see a writer complain helplessly when his
work was used in an inappropriate way, and we were determined that
would never happen to us.=94

Our first course arrives, and he invites me to try his rich chowder,
decorated with crackers and shredded rocket. I offer a forkful from my
plate =96 the roasted pumpkin is warm, the ham salty and the toasted
pumpkin seeds appealingly nutty.

McGuinness has emerged as a vocal campaigner for internet service
providers to pay up for the music consumed over their networks, an
idea that has gained support since he raised it in a speech two years
ago. Publishers=92 drive to be paid for their content, symbolised by
Rupert Murdoch=92s talk of online subscriptions, has helped, he notes,
although he says it is a pity that the News Corp chairman=92s =93road to
Damascus conversion=94 did not take place sooner.

So why give away valuable content, such as a concert, online? =93We
don=92t quite give it away,=94 he corrects me. YouTube will pay royalties
to Universal Music, U2=92s record label and publisher, and share
advertising revenues. It is pointless to try to stop fans posting
concert clips online, he argues. What is possible, he says, is to
expect ISPs to pay rights holders their dues.

McGuinness, who was born in Germany to a military family and lived in
Malta, Aden and England before going to Ireland=92s Clongowes Wood
College, is unsparing in his criticism of how the clashing agendas of
Europe=92s member states have delayed changes sought by his industry.

=93As the EU expands, it is clearly the case that these small,
peripheral nations have no significant cultural heritage to protect in
an international context, whereas Germany, France, Britain and Ireland
certainly do,=94 he says bluntly, in an accent more English than Irish.
=93When the Czech Republic held the EU presidency, for example, simply
by not tabling a motion on [copyright] term extension, they were able
to defeat it. The Czechs!=94

Our plates are cleared away and McGuinness snaffles a stray piece of
rocket stranded on the table between us. The soup has made him hot and
he wipes a hand across his brow.

I ask about U2=92s latest album, No Line on the Horizon, which was
released in February this year and has sold fewer copies than any
album by the band for a decade. =93We were not anticipating that we
would not have a hit single to drive the record,=94 McGuinness admits.
=93That was an unpleasant surprise.=94

Our gnudi arrive in a brown butter sauce with a few crisp sage leaves
on top. =93Isn=92t that wonderful =96 the gnudi?=94 he asks, enjoying the w=
ord
again. The album has still sold more than 4m copies, he says, but he
doesn=92t hide his disappointment. =93It didn=92t work in the marketplace.
It worked creatively, I think. If people give themselves the treat of
sitting down with big speakers, playing it properly and giving it the
time that an album needs, I think it=92s a magnificent record.=94

Few people now listen that way, he laments, but they will pay an
average of $100 a ticket to see U2 in concert, even in an uncertain
economy. In 44 sold-out dates since June, the band played to 3.2m
people, for a gross of about $320m. Running the numbers aloud,
McGuinness calculates that with a similar number of dates planned for
next year, the tour should gross about $750m including merchandise
sales, smashing the $389m record set by U2=92s Vertigo tour in 2005 and
2006.

It has done so in part by using a 360=BA stage to increase each venue=92s
capacity by a fifth. Partly because of the custom-built, claw-shaped
set, the tour costs are about $750,000 a day, =93whether we play or
not=94. The tour should still be =93highly profitable ... but very often
that gross figure is carelessly written about as having gone straight
into Bono=92s pocket=94. Our clean plates are taken away. It is after 4pm
and it seems no table has emptied since we arrived. McGuinness orders
a double espresso and I ask for an Earl Grey tea; his appearance may
be rumpled but there is ruthlessness in his eye as he tells me about
the importance of attention to detail when auditing the band=92s
payments from record companies and publishers: =93On not one of those
occasions did we fail to uncover an underpayment.=94

Don=92t such tricks help explain why people feel labels are just getting
their comeuppance? =93All right, it=92s been the law of the jungle many
times,=94 McGuinness says as our drinks arrive. =93But what dismays me a
little about the online universe is that these corporations, like
Google and MySpace and Apple, don=92t have anything that=92s the
equivalent of artist relations.=94

One day, tech groups will have their own talent scouts and digital
versions of record labels, he predicts. For now, the =93great cultural
collisions=94 taking place worry him. =93I find I=92m often dealing with
[technology] executives who are really quite careless and frequently
arrogant about the cultural impact of what they=92re doing. I wish there
were an atmosphere of nurturing and respect, which I really don=92t see.=94

Our waitress brings a candle. It=92s late autumn in New York, and
starting to get dark. McGuinness, who is married with two adult
children, will soon fly back to his homes in Dublin and London and I
ask what he has planned before the tour starts again in May. A stalled
Spiderman musical, written by Bono and Edge, backed by McGuinness,
should open on Broadway in the spring, and the band is talking about
delivering another album very soon. =93If they pull it off, that would
be great, but I=92ve learnt over the years to plan for all
eventualities,=94 he says.

I ask for the bill, as McGuinness tells me his own musical tastes run
from the Rollling Stones=92 Exile on Main Street to the sung Latin mass
at London=92s Brompton Oratory. =93There is no check,=94 the waitress tells
her investor, and considerable confusion ensues. =93No, I=92m afraid
that=92s no good. Do you ever see that column in the Financial Times
called Lunch with the FT? They have to pay. Oh that is funny.=94 He is
still chuckling as I hand my card over (just the tea and coffee end up
being free) and ask whether he=92ll ever retire.

=93Oh, I=92d hate to. People used to think that rock and roll was music
for teenagers. But we=92ve just come from Madison Square Garden where
Sir Mick was performing aged 66. I=92m always delighted when Mick makes
a record or does a tour because he makes U2 look so much younger.=94

Andrew Edgecliffe-Johnson is the FT=92s media editor

The Spotted Pig
314 West 11th Street
New York

Serrano ham with pumpkin $16.00
Smoked haddock chowder $15.00
Sheep=92s ricotta gnudi with brown butter & sage x 2 $30.00
Bethel Heights Estate wine 2007 $69.00
Large bottle of still water $6.00
Double espresso free
Earl Grey tea free
Total (inc tax & service) $174.00

------------------------------------------------------------


Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International (KEI)
thiru@keionline.org


Tel: +41 22 791 6727
Mobile: +41 76 508 0997