SHOWBIZ: More than just music

Universal Music Malaysia’s managing director Loan Cheong tells Subhadra Devan that the music business today is all about lifestyle

HIS first job of selling cash registers saw Loan Cheong hanging out at a music shop in Section 17, Petaling Jaya. The owner, Kaiser, who previously worked with a music label called Polygram was asked to return to the company and Cheong jumped in for a job as well.

“When anyone is young, music is the only thing that resonates, and  make sense,” says Cheong, 39, the current managing director of Universal Music Malaysia. “So you chase after that boy band, rock group and today, get into the K-Pop craze.

“I chased after the Eagles, went for rock concerts. I listened to all kinds of music because music is close to my heart. My father had a vinyl player and he listened to Teresa Teng and Chinese pop stars. I learnt to play the gramaphone too.

“I bought my first vinyl — George Michael’s Faith — in Jaya Supermarket. Do you remember that place? A fantastic album, played with huge speakers,” recalls the Petaling Jaya-born Cheong, whose name is really Cheong Loan Tai.

He recalls a family joke about the names: “My family calls me Loan, my middle name. My brother is Hom Tai. So we are teased with ‘hom loan’,” says Cheong, with a hearty laugh.

“So yes, I was selling cash registers but I wasn’t doing my job. Music was more interesting for me. I applied to join because Polygram had Metallica, one of my rock favourite bands (on its list of artistes).

“What did I do there? Licking stamps for envelopes, among other tasks. Polygram had a newsletter for its members and there were about 5,000 of them. I had to prepare the newsletter. I was earning RM600—700. No money even for petrol, so I used to carpool with my boss.

“It was way fun then. I followed my heart. Although now it’s all business, you must have passion for what you do, or you can’t do it for long,” says the father of three girls who are “thank god” not into K-Pop.

LIFESTYLE BRAND
Polygram came under another music label before it found home with Universal Music Group. With the buying of EMI music catalogue from Citigroup (although some parts of that deal are still pending) Universal Music is today, according to UK’s Financial Times, the largest music company in the world.

“Although we won the EMI bid last year, we are divesting ourselves of some labels to Impala (Independent Music Companies). The whole process is taking us longer than usual,” says Cheong, who was with EMI Malaysia for 11 years after his stint with Polygram.

He muses that music is a lifestyle brand today and not about sending the CD to the shop or radios anymore.

We are sitting in his new office where a gift of a potted phalaenopsis orchid sits atop unopened brown packing boxes.

“We don’t sell music per se anymore. Rather we are building a lifestyle, so we are investing in platforms and partnerships. For example, rewards programme with banks for say, concert tickets, or spend an amount of money with a product and win a trip to watch Taylor Swift perform,” says Cheong.

“For a telco company, we built the application to download music. For a small fee, the cellphone customer can access the entire catalogue of Universal Music. But if they move to another service provider, that song download won’t work anymore, — it’s called a tattered download. It makes the telco a sexier product.”

The label handles events and concerts, as well. “We provide a one-stop solution — anything to do with the whole music industry to help extend the brand. We no longer just send the CD off, not because sales are dropping but technology is developing so fast. And you know what — kids today don’t know what a CD player is because it’s all in the phone!” he says.

Asked about peer-to-peer sharing and free download sites, Cheong says it’s a social thing.

“But people aren’t paying for it. Of all the music consumed online, only three per cent are paying. It’s not just music, but movies, software. You cannot disregard intellectual property, as there is a value to it. I think it’s an education process,” he says.

MONETISING IT
Cheong explains: “Monetising the vast consumption of music is the challenge because music is now a global business. There is no geographical line and you can buy anything online.”

He asks: “What is the right price? To purchase songs on iTunes, for example, it costs 99 cents per song with some premium products priced at a higher rate such as songs by Andrea Bocelli, because the recording is of good quality.”

He thinks that it’s about “working with all kinds of technology, brands and products to ease the consumption of music so that it feels free”.

For example, he says, “YouTube is free but YouTube Vevo, the official site, has advertisements. So we are facilitating, we are allowing our music content to be used and finding the licence fee for it. It’s not about selling that one song, but the experience.”

THE FUTURE
He adds: “In future, there will be no need to download because soon you stream on demand — anytime, anywhere — with cloud-based services. Wi-Fi will be available everywhere. For instance, the car will come with a hard disc of content. To unlock, you key in the code for which you pay. So from cars for the music, to banks for rewards, alcohol beverages with dance — Universal Music is doing it all.”

For Cheong, the future will hopefully allow him to catch a “live” performance of Madonna. “I know... but I still like her.”

He feels he is where he is supposed to be today. “Everything fell into place. I sold cash registers, hung out at a record shop and there was a vacancy at a music label... I can safely say, I am very lucky. I think God loves me,” he says with a grin, eyebrows raised.

“Although now it’s all business, you must have passion for what you do, or you can’t do it for long,” - Loan Cheong

Metallica is one of Cheong’s favourite bands

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