In the hot seat: Beatport CEO Jonas Tempel

In the hot seat: Beatport CEO Jonas Tempel

28 January, 2009 | 3.59PM

• Written by: Beatportal
• Filed under: Music News: beatport 5 year tour, jonas tempel

As a part of Beatport’s 5-year anniversary tour, we invited readers to send in their questions to Beatport CEO, Jonas Tempel. 

Of the hundreds of questions received, we chose the most relevant and most pressing ones to pass on to the chief. 

Here are his answers.

Ari Newman, Denver: Beatport has revolutionized EDM buying and has been a big part in bringing DJing into the 21st century. Beatport has done a fantastic job pushing the envelope with technology and the distribution model, but what is now missing is the personal, tactile experience of being in a record store. I miss knowing which bins to rifle through, and the experience of having the guy behind the counter pull a bunch of vinyl for me because he knows my sound and what’s new that I’d like. Can Beatport replicate that experience to make the process more personal?

I started DJing in 1990. When I started, the record store I went to here in Denver didn’t allow anyone to listen to the music before you bought it. Can you imagine?

We’d have miles of bins to choose from and literally no idea if the track was good. As a young DJ, I focused instead on learning labels, remixers and artists.

In about 1998 Denver got stores that allowed all the vinyl to be played at DJ stations. At the same time, I could call the buyer and say “Pull me the good shit for this week. You know what I like.”

Two things were important in that moment, someone to help filter the useless content that I would not play, and the feeling of status you get from being treated special.

At Beatport, we have not perfected this logic yet. But believe me, it’s part of our culture.

We’ve tried personal shopping, but really that doesn’t work. It’s just not the same. We need to create technology that helps.

We have an amazing idea that is in the works that will help this along.

It’s not like calling your buddy and hanging out for hours on end at the record shop with the other DJs, but it is a start. The trouble with technology is that it’s cold.

Beatport will work hard to warm it up in the future. It’s part of our heritage. And we will bring it to the world.

Jason King, Ft. Myers, Florida: Is there anything in the works to do away with territory restrictions?

Territory restrictions are a music licensing issue. Beatport uses a system to detect your location and restrict the tracks that are not licensed in that territory. This can be incredibly frustrating as it happens to me regularly and I hate it.

I’ve learned to search for the track on other labels which usually solves the problem. If I had it my way, I would tell the labels to retain their digital rights for global distribution.

But you have to understand, these are industries that have been working this way for longer than I’ve been alive. It’s a very slow system to change.

Beatport could potentially block territory restricted tracks from being viewed and listened to, but in my opinion, it’s just as bad. In the end, it’s a terrible user experience and we all want to improve it as soon as possible. 

Rafael Mendes, Belo Horizonte, Brazil: One day, will it be possible to see a track’s BPM and key before buying it at Beatport?

This isn’t something we are prioritizing right now. There are so many technologies that already do this for the user. It just doesn’t seem justified to invest in the technology.

However, if it becomes reasonable and inexpensive, I’m sure we would consider some additional analysis.

Jorge Martinez: Will you ever have Ableton Live-ready warped tracks?

It’s not likely that Beatport will ever have Ableton ready tracks. Not because we don’t like Ableton, but because the time it takes to warp a track in Ableton is less than 20 seconds in most cases.

And we don’t see the value of improving only that much. Our focus is on improving other areas of our business.

Jorge Martinez: The mixes button has for ages said ‘coming soon’, and still there is nothing. When will mixes arrive at Beatport?

There is no doubt that we have taken forever to solve this. But we are not necessarily focused on the enthusiast customer. With the launch of BP 4.0, this button is live. As time goes on, we’ll continue to improve our offering.

Jeroen Bos, Amsterdam, The Netherlands: Did you start Beatport out of a commercial perspective or because of the love for electronic music?

Beatport is literally the perfect combination of everything that I’m passionate about.

My background is graphic design. In 1996 I launched an advertising agency called Factory Design Labs, Inc.

Our initial client roster was pretty small and we did a ton of event flyers for raves and nightclubs around the world.

It was a great deal of fun because I started the business with all my friends and we really enjoyed the long hours.

At the same time, I was DJing a ton of gigs and even had a radio show on Friday and Saturday nights where we mixed proper house sets.

Between design and DJing, I was literally swamped. In 2002, a friend of mine Eloy Lopez, who is a co-founder and our Chief Operating Officer, had purchased Final Scratch, the predecessor technology to Traktor and other laptop systems.

We used to play gigs in Final Scratch and were totally inspired by the potential of this technology.

DJs like Josh Wink were doing amazing sets and we really wanted to push our skills. The only issue that everyone was having is that there was no digital content.

So we were all buying vinyl and recording it into our computers. Eloy had a simple idea and asked, “Why can’t we just sell this content digitally?”

My first answer was simply no way. It just wasn’t done in 2002. People were still recovering from Napster and felt uneasy about releasing content digitally.

But there was something special about this idea that we just couldn’t let go.

My partner at Factory and I worked with Eloy to create a business plan and to see if we could prove or disprove the concept.

We had a lot to learn because literally there was nothing else in the market to observe at that time.

Our vision was to combine our skills as designers and our passion for electronic music to create something special.

By early 2003 we had made the commitment to go for it and scraped together a small team of our friends who shared the passion for electronic music.

Together we built Beatport 1.0 from the ground up. It was a labor of love. When we launched in January of 2004 we had only 72 labels and just over 1,000 tracks.

Most people might have considered that a failure, but to us, we were a wild success.

The early days were challenging as people were waking up to digital. But as time went on, we knew that we had to work hard to make it happen.

Fast forward to today, and we still have that same passion. The original members of that team still work at the company and are now the leaders of our future. It’s been an amazing and fulfilling experience.

So to specifically answer your question, electronic music is my passion. As a DJ, a designer, and as an entrepreneur, it’s in my blood.

We’ve grown the business from its humble beginnings to be a success story. But remember that Beatport is just a platform, the real credit goes to the artists and labels that support Beatport on a weekly basis.

Ari Newman, Denver: I can foresee the day when bandwidth and streaming are reliable enough that Beatport could actually host my music library and I only have to stream down the tracks I have lined up on my laptop. The benefit is unlimited music access w/o lugging a single-point-of-failure or easily stolen hard drive around – will this ever happen?

I think that day will come too. Beatport has ideas around this topic. Cloud storage is very important and we have concepts that relate to solving this very issue.

There are risks and benefits to the idea and it won’t be for everyone. But for home use, it’s ideal. I don’t know if I would trust streaming my tracks in the DJ booth at the club, but I guess you never know.

I didn’t imagine a day when I’d play off my laptop, but I’m doing it more and more.

Robert Duff, Edmonton, Canada: What was your first exposure to electronic music?

Hard to say really. I began to like electronic music at around the age of 16.

I would hear pop music with electronic influences like Depeche Mode, Erasure, New Order, Information Society, Yaz, and others at the time and began to really enjoy the wide fidelity of the sound.

It was the first music that had a real big kick drum and I have always loved bass. Depeche Mode’s ‘Violator’ album with its amazing synths and bass and Information Society’s ‘Hack’ with all the perfectly tuned samples were probably my greatest influences.

Additionally, I took a year off of college in 1990 right when house music found its way to Denver.

I was just old enough to go to the clubs and I found the music intensely addictive. It was a whole new culture that I could identify with for the first time.

At that point, pretty much everything in my life changed. I began DJing.

Like all DJs I started in my house then progressed to opening gigs for my buddies that were DJs.

Then I made a few nights of my own which were small but potent. And ultimately made my way to headlining slots, my own radio show, and rave gigs.

Now, I still DJ regularly and have been lucky enough to find myself in front of crowds on almost a weekly basis for the last 20 years. It’s hard to believe, but I guess when you love something, time just goes by without you even noticing.

Juan Navas: Define Beatport in one sentence.

Great question. Depends on who I’m talking to. If I’m talking to someone who has no clue about DJs or electronic music culture my response is generally that Beatport is “iTunes for DJs”.

If I’m talking to someone who knows the subject and the heritage of electronic music, is say that “Beatport connects DJs and fans with the music they love.”

To me, the purity of the experience is the emotion. Love is part of the culture. It’s more than just a song. It’s the experience of a DJ peaking the room.

The hands-in-the-air moments. The basslines that shake your nose hairs. You can’t explain that to someone who doesn’t understand.

The chills you get as a DJ when you know you’ve played the right track at the exact right time. Love can’t be underestimated.

Sebastian Aird: Even though you have recently dropped your prices, my question would be - why are you still so expensive?  Why should digital downloads have the same price tag as vinyl when they are just data and nothing physical?  Do you think you should bring your prices more in line with say iTunes, or do you feel that dance music fans are just happy to pay more?

We get this question a lot and most people assume all the wrong things, which is normal when you have no internal perspective.

It is my opinion, and the opinion of everyone at Beatport, that we cannot sell the content any cheaper.

The economics of the sale just don’t allow for pricing that is competitive with other commercial sites. And quite honestly, we don’t intend to compete with iTunes.

Our opinion is that we provide a valuable service that goes far beyond providing a link to a file to be downloaded. We are a brand that globally represents electronic music.

We have an army of label managers and genre managers to comb the world looking for the next best sound.

We work extremely hard to be relevant and introduce new artists and labels when we think they have a chance to be commercially viable. We encode every track ourselves.

We write all the code for our website and do not buy off the shelf e-commerce solutions.

We market electronic music globally to a growing fan base and we constantly reinvest in our user community.

Additionally, the infrastructure that it takes to store all this music is significantly more than the rent my friend used to pay for his small record store. We pay more in a month that he did in five years.

Sase Antic, Macedonia: Do you plan to re-activate Beatport’s Affiliate Program (via LinkShare)?

Affiliate programs are riddled with fraud and ours was no different.

There are dozens of websites out there that exploit and steal music and post it on free blogs then claim to be affiliates helping Beatport market to new users.

It’s a total scam and we will likely never enter into an affiliate program like the one we had ever again. Instead, we’ll hand pick our partners and go it alone.

Paul Tighe, Ireland: When overnight, Beatport changed its prices from dollars to euros and then added a tax, I was furious at the lack of respect being shown to the site’s regular users. This was compounded by the fact that the company does not even supply an email address which complaints can be sent to. So are the recent price reductions a sign that Beatport has finally started to treat its customers with some respect?

I’m not sure what you mean by treating our customers with respect.

It’s unfortunate that you have never met me personally, or anyone at Beatport, because if you had you’d know how much we care about the Beatport community.

We have the best customer service in the industry. It’s sad to hear these things when we literally focus intensely on customer service and making sure we take care of every issue as soon as possible. 

I’m sorry if your experience was bad, but let us know what we can do to make things right with you. As far as price changes go, it’s just an unfortunate fact of life that prices change.

Sometimes they go up and sometimes they come down. I’d say that our prices are one of the most stable in all of retail outside of iTunes which is now very visibly on the way up.

Johann, Sydney, Australia: Artists still have to get signed by a label before they can get their tracks on Beatport. Why? I figure you as Beatport could get a better margin if you allowed newbie artists to publish their tracks on your portal and share proceeds 50/50.

Our business is tough because we manage two sides. First, we manage a supply-line, which, is our label partners.

They provide the content that fills our pages. On the other side, we have the customers who come to the site looking for the brands that they know and love - labels and artists.

Beatport uses the labels as a filtering mechanism for music. Since 2004 we have amassed a group of label partners that totaled 9,000.

During 2008 and now into 2009 we are working hard to reduce that number to around 5,000. We are removing underperforming labels from our site so that our customers don’t have to dig through pages and pages of content that they just won’t ever buy.

Our fear is that if we opened up the site to anyone who wanted to post a song to sell, it would quickly overwhelm our customers with music that just isn’t ready for prime time.

We have talked about introducing a do-it-yourself environment where people can upload and sell content, but right now it’s not in our immediate plan.

Renato Patriarca: Is it true that Beatport has been encouraging artists to leave labels and set up their own digital labels? Why? Don’t you think that labels do a great job of developing artists careers and that without them there will be more bad music released?

I don’t know anyone at Beatport who has encouraged an artist to leave a label and go it alone. The reality is that artists are artists, not business people. The labels provide the administrative backbone for the artists creativity.

Even if an artist started his own label and it grew, that artist would eventually have to hire people to manage the label. As for artists promoting artists, I can’t speak to that.

At Beatport, we are constantly hoping the labels will promote their artists more.

As for the question of bad music, well, I think labels release tons of bad music out of loyalty to their artists. So I don’t know how to judge where to draw the line. In the end I agree that less “bad” music gets released simply because of the economics of doing a release properly.

Morgan Sully: How will Beatport continue to support independent DJs and producers?

Beatport has a keen interest in growing DJing into a massive global culture. Additionally, most electronic music producers are also DJs.

So the two go hand in hand. Our vision is to better serve the producer in the very near future.

Our partnership with Native Instruments has never been fully realized. Be on the lookout for new and exciting things. Additionally, we’d like to allow DJs and artists to build their profiles on Beatportal through a new venture that we’re about to launch called BeatWiki.

Dennis Romero, Irvine, California: What do you think of iTunes finally following your lead so many years after you helped introduce a DRM-free retail model?

I don’t think iTunes and Beatport have much in common besides that we both sell digital music.

Beatport has always been DRM free for one main reason. There is no professional DJ technology that decodes DRM. And so for Beatport, that means that it’s simply not compatible with our industry.

For Apple, it was simply a win-win solution. They limited the tracks to playback on only their hardware. And then, when they dropped the DRM, they allowed customers to re-download music for a premium price. It’s a win for all.

They look like they are doing good, but they also just made a few billion by being smart. For Beatport, we don’t have that scale to treat the market quite the same way. It’s our vision to provide high quality music, encoded in high quality formats and continue to raise the bar on sound quality.

Juan Navas, Bogota, Colombia: Jonas, what do you think will be next for labels? If already-positioned names like Hed Kandi with house, Armada with trance, and Minus with minimal, to name but a few, continue being exclusive to those genres, won’t they be affected by a hard-to-ignore music evolution? Herein, if labels evolve, will their fans deal with it?

I don’t have a good perspective on running a label because it’s not something that I’ve ever done. But my instincts tell me that brands like the ones you have mentioned will adapt as time goes on.

Richie Hawtin, for example, is a great entrepreneur with a string of successful record labels, all with a small niche play.

Daniel Miller, who runs Mute Records, has really focused on evolving sounds. He discovered and helped to build the careers of Depeche Mode, Erasure and Moby. So I guess it depends on the label boss and how committed they are to the job.

1julius2: The electronic sound was firstly an underground community and Beatport has helped to democratized it. Aren’t you afraid that we will lose the original essence?

I’ve never been able to draw a circle clearly around electronic music. But our vision is to focus on the independent music business. I don’t know if our favorite minimal techno artist is going to play the main stage at Coachella or Lollapalooza.

Consumers generally don’t take risks on brand names they don’t know unless they were introduced to them from a trusted choice. The democratization of a sound has already happened in hip hop. Five years ago, they really couldn’t make enough music to satisfy the demand.

Producers were turned into mega millionaires by record labels dying for a hit. And now the new target is electronic music. Artists like Daft Punk have crossover power. Justice and even Deadmau5 continually gain market appeal.

The sound that most closely relates to rock will be the next big winner I think.

Juan Navas: Considering the current worldwide economic condition, what things/facts do you think will step-up for labels and stores that move through this digital platform? Do you think this “storm” will affect services like iTunes and Beatport less than other companies out there?

I guess I don’t have a good answer to this one. For Beatport, the economic reality is felt 100%. I’m sure it’s the same for all stores.

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