[MUSIC PLAYING]
SUKHMANI NAGI: Hi, everyone.
And welcome to the very first Fireside
Chat with Digital Leaders, hosted by Google Cloud.
My name is Sukhi.
And today, I have Sebastian Hentzschel, the CIO
and CTO of Bertelsmann Music Group with me.
Welcome, Sebastian.
SEBASTIAN HENTZSCHEL: Hello, Sukhi.
Thank you for having me.
SUKHMANI NAGI: Nice to have you here.
To kick it off, I prepared a few questions
which are more of a personal nature
so the audience gets to know you first.
I'll just ask you five questions and get a quick response.
SEBASTIAN HENTZSCHEL: Fire away.
SUKHMANI NAGI: OK, great.
So my first question is, San Francisco or New York?
SEBASTIAN HENTZSCHEL: New York.
SUKHMANI NAGI: Bitcoin or gold?
SEBASTIAN HENTZSCHEL: Bitcoin.
SUKHMANI NAGI: Soccer or tennis?
SEBASTIAN HENTZSCHEL: Soccer.
SUKHMANI NAGI: Your favorite music?
SEBASTIAN HENTZSCHEL: That would have to be Metallica and Guns
N' Roses that I grew up with--
so rock.
SUKHMANI NAGI: Interesting.
And the first thing you'll do once the pandemic is over?
SEBASTIAN HENTZSCHEL: Take my family
to a nice, long vacation far away.
SUKHMANI NAGI: Super nice.
I'll do the same.
[LAUGHING]
Now let's talk about the BMG and Google Cloud partnership.
To start, I'd like to understand what BMG does
and what you guys are about.
SEBASTIAN HENTZSCHEL: Sure.
So BMG is a recorded music company and a music publisher.
First and foremost, we represent the music rights
of artists and songwriters.
And we distribute their music.
We register their music.
And we make sure they get paid whenever they get played.
SUKHMANI NAGI: So if we think about one retail CD sale,
what is the equivalent of streams one artist
has to do to get the same amount of money?
SEBASTIAN HENTZSCHEL: An artist song
would have to be streamed about 1,500 to 2,000 times,
depending on the platform, obviously.
But as you can see, this has various implications.
So it only works in large numbers.
And, of course, when it comes to monetization,
the data volumes that we have to process in order
to count royalties back to the artists are sheerly enormous.
The number of lines, roughly, that we use to count back
to the artist-- that is really fully auditable and has to be
100% accurate--
that's around 2 billion lines of data.
And unfortunately in the music industry, data is not perfect.
Let's assume that in those 2 billion lines of data,
only 0.01% of lines aren't fully allocatable or uniquely
allocatable to a song.
Then you would have to manually review 200,000 lines of data.
And that's just way too much to handle.
And that's where AI machine learning really come into play.
SUKHMANI NAGI: Wow.
That's quite a lot.
And I guess now you mentioned AI and machine learning.
Probably, this is where Google Cloud came into the picture.
Could you please explain what challenge exactly Google
Cloud helped you solve?
SEBASTIAN HENTZSCHEL: We initially
thought a server is a server is a server.
So how can be--
Cloud different?
But every other year, we found ourselves in a situation
where our infrastructure simply was cracking
under the load of increasing, exponentially increasing,
data volumes.
So moving to Cloud became a necessity for us.
And it, first and foremost, helps
us scale much more easily and much more conveniently,
and not with so much blood, sweat, and tears.
SUKHMANI NAGI: And now taking it back to the artists,
what exactly does it mean for the artists
that you are now able to scale more flexibly?
SEBASTIAN HENTZSCHEL: So the way artists benefit from it
is getting their royalties quicker, more frequently,
and being sure that we do everything, and now
with much more muscle than before, to make sure
that everything gets paid back to them on a global basis.
SUKHMANI NAGI: I love this example, Sebastian,
because it shows very well that Cloud is not only about IT,
but it can also enable business value.
And here, it truly did.
Could you explain how the productivity of your team
increased once you started the Cloud journey?
SEBASTIAN HENTZSCHEL: I think we're
able to manage the application and infrastructure estate we
have with fewer people.
As I said initially, we were heavily--
we've been heavily outsourced.
And we're now growing a very small Cloud Infrastructure team
internally.
But on a like-for-like basis, we are
able to run things more efficiently than before
by scaling up and down, by making that technology more
easily accessible, by not having to rebuild big forms of service
manually, by just simply having that technology available.
So that's the technology teams.
For business teams, it really comes down
to platforms like BigQuery or your AI and machine learning
platforms.
We make that accessible.
And they operate on Google Cloud just as much
as the technology team does.
So it is highly relevant, not just for technology teams.
SUKHMANI NAGI: Great.
So you're really democratizing AI in your organization.
And finally, what's next for BMG?
SEBASTIAN HENTZSCHEL: First of all,
we need to finish the Cloud migration, when
the [AUDIO OUT] of it.
And then we're really back to focusing on doubling down
on making the complex, the complicated world of music
rights as simple and as transparent
as possible to our clients via BMG
and other ways of engaging with our clients.
We have a great technology platform.
We have great people.
We have great processes.
And that's what we've been able to build on a global scale.
So it's definitely conceivable to think about other rights
forms in music and beyond that we could
start to manage for clients.
And I think that's a really exciting outlook.
SUKHMANI NAGI: Thank you so much.
It's very interesting to see this big vision.
And I'm very excited to see how it
will materialize in the future.
SEBASTIAN HENTZSCHEL: We do, too.
Thank you for having me.
[MUSIC PLAYING]