David Hyman is the CEO and founder of MOG, one of the first online communities created for music lovers. A digital media pioneer, he started the very first music website and sold one of the first ads to ever appear on the Internet.

David served as CEO, Executive VP and Chief Strategy Officer at Gracenote. And as SVP-Marketing at MTV Interactive, he oversaw all marketing activities for MTV.com and VH1.com. David came to MTV through its acquisition of SonicNet, where he had been SVP, Sales & Marketing.

Before SonicNet, David co-founded Addicted To Noise, the first online music website. He negotiated the merger between Addicted To Noise and SonicNet, creating the largest online music website at the time.

I recently chatted with David about his amazing career and the future of online music communities.

R&G: You’re an online pioneer having worked with Hotwired, Addicted to Noise, SonicNet and Gracenote. Tell me a little bit more about your background.

David: Sure. It’s been a long, wild ride. Prior to Hotwired, I was living in Europe for about five years. I was in the audio equipment industry, working for a company that distributed American audio equipment in Europe. While I was living in Amsterdam, I stumbled across a magazine called Mondo 2000, which was the predecessor to Wired. Mondo was a publication created by a guy named R. U. Sirius, which really focused on virtual reality and smart drugs. That magazine totally changed my life.

R&G: This was in the early ‘90s?

David: Yeah, ’91 or ’92. People who were into Mondo kept every issue. It was such an amazing magazine. That’s what got Louis Rossetto to create Wired. He was obsessed with Mondo, and I think his concept was to create something a little more commercial and less esoteric. Towards ’92, ’93, they started talking about Telnet and the World Wide Web. That got my interest peaked. I had moved to Sweden and was able to connect to the Internet kind of pre-Mosaic through Uppsala University, so I got a taste very early on. I quit my job in Europe and moved to San Francisco with the concept of starting a CD-Rom game company. I was at Mac World, sourcing the equipment that I was going to buy to author my own CD-ROMs, and Wired magazine had a booth where they were giving out free copies. I met a bunch of people there who told me they were thinking of starting a website that was ad-supported. I was like, “That’s definitely the future. I’ve been thinking about that for a while.” So, I really hounded them. I remember handwriting a letter and delivering it, just really wanting to be a part of that team. All of a sudden I got a call: “Hey, your whole background is sales. Would you like to be a part of the sales team on the Internet?”

R&G: This was around ’94?

David: Yeah. I was with Organic and Rick Boyce, up in Organic’s offices the moment the banner was created, when they were sketching it out, that became the standard IAB banner size. We were like, “What are people going to care about? I guess they’re going to care about the impressions and the click-through rate.” We came up with all these stats. That was a really exciting time.

R&G: Did you come up with the term “click-through” and the 468 x 60 banner size?

David: No. It was a group effort. I won’t take all the credit.

R&G: Is it true that you sold one of the first online ads ever?

David: Yeah. Rick Boyce sold the first two, Café Pacific and Zima, and then I sold Virtual Vineyards.

R&G: And then you co-founded Addicted to Noise?

David: Michael Goldberg started it. I was the first paid employee, so I’ve been blessed with founder status. I was at Hotwired, and all of a sudden, I saw this thing called Addicted to Noise on the web and it totally blew my mind. It was a well-done editorial for daily music news and album reviews. Goldberg had amassed the greatest rock critics from the print world. There is nothing like it to this day. He had legends like Greil Marcus and Dave Marsh writing. He had Joey Ramone from the Ramones writing articles. It was an exciting time in music. This was when “grunge” was really exploding, so it was just a great site. There was a guy at Hotwired named Rob Levine who now writes for New York Magazine and the Times who was doing the music section of Hotwired. He was freelancing for Michael, and I said, “You’ve got to introduce me to Goldberg right away.” We had lunch, and Goldberg was like, “I want to sell ads on Addicted to Noise.” There were only a couple of people doing it, so I jumped ship to go do that. At that point, I was running Biz Dev, marketing and sales; I did it all. I negotiated the merger with SonicNet.

R&G: Which MTV eventually bought?

David: Yeah. Nicholas Butterworth was doing SonicNet on the east coast, which was cybercasts and chats, super webby. Addicted to Noise was editorially driven. We were desperately looking for money. SonicNet had raised a bunch of money, so I reached out to Nicholas and he loved what we were doing because they wanted editorial. Those few years before MTV bought it was an amazing time. The site was the biggest music destination on the web.

R&G: And then you started something that is very, very important: Gracenote. Can you tell me about that?

David: I ran sales and marketing for SonicNet. Then MTV bought us and I was the SVP of Marketing for about a year. A guy from CDDB had reached out to me at MTV looking to do a deal between CDDB and MTV. They had this music browser concept back in the early days of CDDB. The idea was that every time someone played a song, they would serve up this music browser with contextual, related information. You pop a CD in or play an MP3 and this music browser appears with the album art and lyrics and all this content. I thought that was a huge opportunity for MTV because they wanted MTV content to appear in that browser. I was like, “So you mean when somebody’s playing a song, you can instantly serve up the related content from MTV while they’re listening to the song? That’s revolutionary.” The concept of media identification and serving related content to me was just a mind-blowing opportunity. I became infatuated with the company and really drove MTV to do the deal with them. In the process, my infatuation became known to the main investor in CDDB, so he courted me to come over to another company.

R&G: Did you come up with the technology?

David: No, that was Steve Scherf. It was called CDDB when I got there and there were a handful of engineers, but I really built the business. I renamed it Gracenote, and since it was for CD identification only, to make it future-proof, I bought a company called Cantometrics. Cantometrics had waveform analysis technology to identify tracks.

R&G: Hypothetical question: I have a limited amount of time and want to join one music-based social network. Why choose MOG, say, over imeem or Last.fm?

David: Out of the gate, I’ll say we’re not a social network. We’re much more like a Yelp or a YouTube, where we have a community of people who are content creators creating a massive amount of content for the benefit of the consumer. By far, most of our traffic comes from people consuming the editorial content. I use Yelp all the time, although I’ve never joined. Yelp has a community of content creators. The community on MOG is a community of blog writers, and a very editorially driven destination. We’re generating 4,500 blog posts a week. We slice and dice that content so that you don’t have to go to a user’s profile page to consume it. You can go to a Bob Dylan page and consume all of the blog content about Bob Dylan, or you can go to the Highway 61 Revisited page and consume all of the blog content about Highway 61 Revisited. In many ways, it resembles more of a Yelp for music today. That being said, we’ve been working on something for close to two years that we hope to launch soon. It is a far superior way to consume music for free than imeem or Myspace Music.

R&G: Do you think the ad-supported models are the future of the industry?

David: 100%. I think its one viable future. There will be other things that can run in parallel. There’s probably a market for people who are willing to pay more to remove the ads and have a higher bit-rate, to pay a monthly fee. A large segment of the population wants free with the ads, but I think there’s another subset of the population that would be willing to pay to have an ad-free version that has a higher quality audio.

R&G: Users would have the option, as they do now, to go to Amazon or iTunes to buy the music?

David: Yeah, that’s definitely a viable integration solution. I also see something like an eMusic being integrated, where users can pay $10 a month for 30 downloads but have access to the catalogue of Amazon, or something that’s better than just having to download a track for $0.99.

R&G: People are worried about privacy issues. Do you share information with the record labels?

David: No, but to be honest with you, they wouldn’t know what to do with it. Outside of that, they never ask.

R&G: One of the big things I think that you guys offer is human filters versus Pandora or some of the other technology driven filters.

David: I think there’s a place for both. Based on research that we’ve done, there is a large segment of the population that doesn’t want human filtration. They want something incredibly passive and automated like Pandora. For the people willing to put in a little more effort, where they can build their own trusted sources, it’s probably better and more rewarding. It’s certainly not the be all end all. I think there’s a place for playlist sharing and a place for automated recommendations. They require different levels of engagement between passive and active. Some people like passive and some people, who are more enthusiastic, prefer more active discovery.

R&G: Rick Rubin is on your board of directors. That’s a great endorsement. How involved is he with the site?

David: He’s pretty involved. I was at his house two days ago. I’m with him every few weeks. He’s not as involved in the MOG that you see today. But with the one we haven’t released yet – internally we call it MOG 3.0 – he’s been super-involved in it, really from a user-interface perspective.

R&G: Are there any other interesting things you’d like to tell me about the company?

David: We’ve been growing. We launched this blog ad network in August, so now in addition to selling ads on MOG we’re selling the ads for 300 of the top music blogs.

R&G: They can choose the ads in terms of what they want run, and the CPM, correct?

David: They can set floors. That’s correct. That’s been a huge success. Our traffic has been growing dramatically. We were at just about one million unique visitors in August, and now we’re at 5.5 million.

R&G: That’s impressive.

David: It’s been great. That being said, the ad market has definitely gotten tougher, no question about it.

To join the MOG Network (click here).

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This entry was posted on Friday, March 20th, 2009 at 5:46 am and is filed under Music Biz. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.