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PressPlay and MusicNet vs. Artists
gilroy writes: "According to a New York Times article (free registration, yadda yadda), despite taking the moral high ground (that they want to see artists compensated, as opposed to all those evil downloaders), the record companies have actually set up pay schedules so as to -- wait for it -- rip off the artists who record the music. Some figure they will earn less than $0.0023 per download -- yes, that's hundredths of a penny. Best quote from the article: 'For many acts, suddenly there appears to be little difference between the illicit file-sharing system and record-label services.' Good to see they're fighting for the artists, n'est-ce pas?"
They're only honest and fair when they can make/save more money by doing so.
Any sufficiently advanced influence is indistinguishable from control.
The greedier the industry gets, the better it is for the artists and the public in general, simply because it will eventually reach the point where everybody (and, hopefully, Metallica too) will just want to bypass them. The nice thing is, we now have the means to do so. It's much easier to convince a judge that a publisher does not deserve protection if it's obviously ripping everybody off.
Purchase tickets for their concerts, they recieve very little in the way of compensation from CD/tape sales.
Thanks to file sharing, I purchase more CDs
Thanks to the RIAA, I buy them used...
It seems the only way that we'll break out of the cycle of recording companies ripping off artists are to bancrupt them. And that means hard times for recording artists while a new economy is built to support them.
I do think that file sharing is a good thing, but it is also destructive to the current economic structure of the music industry. But, with change comes pain.
Moderation: Put your hand inside the puppet head!
So when someone get's busted for illegal copies of mp3s, is that the value the MPAA will use to calculate damages?
I'm glad someone is. Though I agree with the idea that record companies aren't the elite "doers of good" in the industry, the fact remains that many geeks (myself included) have basically been fucking over the artists by downloading free music. Admit it. The first time you saw someone download something from Napster/GNUtella/whatever, you had a pang in your gut that said "Isn't there something wrong with this?" It's called guilt.
There are hundreds of record labels that get screwed over by these practices - there are millions of artists who get the same. Unfortunately, without a massive revamping of the entire industry, you can't fuck one and not the other.
Go here: http://archives.nytimes.com/auth/login?URI=http:// www.nytimes.com/2002/02/18/technology/18SONG.html to get around their registration process.
Holy Hannah, the labels and Pressplay get 91% of the revenues? I want in that racket. And think, after 1000 downloads, the artists will have a shiny 2 dollars 30 in their pocket...reasonable compensation.
Even better is this tidbit: Another irritant for the artists, several lawyers and managers say, is the distribution of the $170 million settlement from MP3.com, an Internet company that offered a music storage service in violation of copyright law.
The labels were to share that money with artists whose music was put online without authorization, but several artists' representatives said nothing had been distributed.
Raise your hands, who here didn't see that coming.
Fortran programmer...oh yeah. Array math for life!
He added that it was "beyond logic" that artists would choose to leave their music off Pressplay and "effectively encourage the use of illegal services."
In other words, why would an artist give his/her music away for free when they can make money using pressplay?
Think of pressplay as another broadcast source. Just as each time an artists gets dinore when their song is heard on the radio, they will get money each time their song is downloaded from pressplay.
I think that once the kinks are worked out so that the artists feel as if they are getting their "fair share," this system will become very very popular.
...who really believes that the Record Companies have their artists' best interests at heart? Miles Copeland III can tear up his shirt all he wants about how Napster is infringing on musicians' rights, the only thing members of the RIAA care about is keeping their stockholders happy.
We need more artists like George Clinton and media-whore Fred Durst of Limp Bizkit to support file sharing of their music, and give the (record) Man a big finger. When artists agree to file sharing, perhaps we'll see a real shift in the industry's exploitative business model.
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As one rock manager computes it, if a consumer buys the standard Gold Plan on Pressplay, paying $19.95 for 75 songs downloaded to a hard drive and 750 streamed so that they can be heard only once, an artist, after these deductions, gets $.0023 per song downloaded. To earn a penny, more than four songs must be downloaded.
Aren't the artists getting shortchanged? According to copyright law, the current statutory rate for a U.S. copyright is 7.1 per song. (See, 37 C.F.R. 255.3(h)) This minimum rate is effective until January 1, 2000, after which it will go up every two years until 2006, at which time it will remain at 9.1 per song until changed.
There's a lot more to royalty calculations as well. More info on Freeadvice.com.
I'm not afraid of falling, it's the sudden stop at the end that frightens me.
No, it's thousandths. ;)
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Some figure they will earn less than $0.0023 per download -- yes, that's hundredths of a penny.
.23 cents or 2.3 tenths of a penny not hundredth. But still it's a rediculous compensation for the charge.
A penny is one hundredth of a dollar so the figure shown above is
Sorry, couldn't resist.
"as plurdled gabbleblotchits on a lurgid bee" - Prostetnic Vogon Jeltz. (One man's humorous is another mans flamebait)
So, it wasn't really coding or encryption work that delayed these services so long. It was getting all the $500,000/year business people to figure out how to optimally screw both consumer and artist at once.
Never doub the ability of a business school grad to screw a large number of people when they put their mind to it.
Because when my one hit wonder song goes platinum and recieves 1,000,000 downloads, I will have made a wopping 2,300 dollars, almost enough to compensate the recording studio for greeting me. I think I will stick with the 'making money from my computer' SPAM I get from my joecool@aol.com email address. I'll bet Scientology wishes they thought of it first.
This Wiki Feeds You TV and Anime - vidwiki.org
Well now we know how much songs are worth, I figure my 11gigs of mp3s work out to around something in the range of $5.33. I can afford that, where do I send my money?
Even better, the fans have to download broken formats that will be unplayable in a few years, so the artists can have another Big Mac later on, courtesy of the same 1213 fans!
The manager also expressed shock that the Pope is Catholic, it rains in Seattle, and that Bill Clinton is no longer President.
Recording companies offer the artists a service they often like: "Don't bother with the business, we've got all the skilled marketroids to ensure your genius will reach the masses. Just keep doing you art". This comes for a price, of course. But truth is, managing your own musical business while doing art is a real pain. I hope such incidents will entice more and more artists to try alternative ways of ditribution and earnings.
Giving away the music and being paid through Paypal seems a bit overoptimistic, giving away the music, or making it very cheap, and being paid through concerts is something some bands are actually doing, trusting small companies that essentially work through the web is something I'd like too see develop in the future.
MPAA has a monopoly they don't want to lose. It's not only against MP3-sharing they are fighting, but also against any possible alternative to the way they make business. Because they can't afford to stop to grow.
That sucks. I really thought that as soon as the music industry eliminated illegal filesharing, world culture would gain tremendously from a steep increase in high-quality content made by well compensated artists. What a let-down.
Most bands have already signed their rights away to the music to the record company for the record deal. So the stuff that you're download still belongs to the record company, not the band. So when you download something that the record company owns, and pay the band, the person that actually owns the rights to that music you just downloaded isn't getting anything.
Yes, it sucks for the band/artist, but they're the ones that signed the contract. Nobody is screwing the band/artist, except themselves. It may not be morally right, but it's true.
Free Mac Mini
This was foreshadowed when the record companies took all those nasty music pirates to court for "ripping of the artists".
These same companies felt no need to share the money they won in court with the same artists they were "defending" and "fighting for".
The music industry's main complaint seems to be "You're shearing _our_ sheep! Only we get to do that!"
From the artists POV at least alot of people were listening to your music under the old system. Now you don't get squat AND no one's listening. Is that a net win or loss?
Sheesh,
=tkk
Bill Gates - Creationist?!?
Ever notice how entertainers often champion the anti-corporate causes out there, or at least bemoan the politicos who support the big "traditional" corporations like oil, steal, chemicals, etc. I'm talking about Alec Baldwin, Barbara Streisand, Rob Reiner, etc.
Don't you think its funny that, in terms of basic business ethics, their industries are about the most atrocious as far as supressing individual rights?
Then again, bad practices by the music/movie industry probably never killed anyone, whereas Union Carbide has a death count worse than Ted Bundy. Then again, its easy to point to the sludge in your backyard and say "The Exxon plant next door put this here" and get a positive public reaction than "The RIAA won't let me share my music online."
Some men spend their entire lives trying to kill themselves for having been born. --Ross MacDonald
My Karma is maxed out, so no, I'm not whoring.
Record Labels' Answer to Napster Still Has Artists Feeling Bypassed
By NEIL STRAUSS
In their bitter battles against Napster and other free music downloading services, record company executives have wielded one moral argument that has placed their position beyond self-interest: the fans take the music without proper permission and don't pay the artists a dime.
Last December, the major record labels responded with two Internet services of their own where fans pay monthly fees to download songs. Under this arrangement, however, the performers still don't get a dime: for each song downloaded, they stand to get only a fraction of a cent, according to the calculations of disgruntled managers and lawyers.
And, artists and their managers say, the labels, like Napster, aren't putting the music online with proper permission either.
"I'm not an opponent of artists' music being included in these services," said Gary Stiffelman, who represents Eminem, Aerosmith and TLC. "I'm just an opponent of their revenue not being shared."
Because the sites are new, no payments have been made yet, but the payment plan has so infuriated scores of best-selling pop acts, including No Doubt, the Dixie Chicks and Dr. Dre, that their lawyers have demanded their clients' music be removed from the sites, with some even sending cease-and-desist orders. Only in some cases have the major record companies complied.
Since Napster was born on college campuses in the late 1990's, peer-to- peer file sharing services have become the bane of the established music business, with, at their peak, some 60 million Napster users sharing nearly 40 million songs illicitly. Even after a federal district court shut Napster down, other free services proliferated, with Kazaa and Morpheus attracting an ever-growing base of users sharing not just music but movies and software as well.
In December, the music business responded with Pressplay and MusicNet, both pay-to-use subscription services where users can listen to or download a specified number of songs each month. Pressplay is a joint venture between Universal and Sony Music, and MusicNet teams BMG, EMI and AOL Time Warner (news/quote) with Real Networks.
"All of my clients had their attorneys advise the labels that if they did use my clients' music on Pressplay or MusicNet, they would be in breach of contract," said Simon Renshaw, who manages the Dixie Chicks, Mary J. Blige and others. "Some artists they took off, but some they didn't. It's becoming very obvious to me and my peers that we're becoming victims of what is a huge conspiracy."
Representatives of the five major record labels would not talk on the record about the payment system or their rights to use the music. But in comments not for attribution, several executives at labels and their subscription services did not dispute the accusations regarding the payment plan. They said their first priority was to make the services attractive to consumers and that the details of compensation could be worked out afterward.
In a letter responding to a lawyer who is trying to remove an artist from Pressplay, the head of business affairs for several Universal labels, Rand Hoffman, set out a company position. It is a view shared by other record executives, who say they are investing heavily to fight piracy and develop a fair compensation system for artists who are ungrateful.
"We are now spending tens of millions of dollars to help launch Pressplay in the hope that a legitimate response to the illegitimate services will provide an attractive alternative to consumers," Mr. Hoffman wrote in the letter. "Pressplay is committed to making music available on the Internet in a manner that is legal and that ensures that artists and publishers will be paid. This is truly a time for artists and record companies to be working together."
He added that it was "beyond logic" that artists would choose to leave their music off Pressplay and "effectively encourage the use of illegal services."
Though the two new services don't appear to be widely used, what worries artists and managers is that a precedent is being set, so that if the labels finally come up with a viable online music subscription service, they won't have to share a significant portion of the proceeds with artists and can claim that this is the way business has always been done.
The crux of the debate over artists' compensation involves whether they should get a licensing fee or a royalty payment.
When their music is used in movies, in commercials and on Internet sites, artists are paid a licensing fee, which, after payments to the producer and the publisher, is split 50-50 between artist and label. Although Pressplay and MusicNet license the music, the bands are not paid a licensing fee. Instead, the labels pay their artists a standard royalty for each song accessed by a fan, as they would for a CD sold.
This means that the artist gets on average less than 15 percent instead of 50 percent. But, out of that, 35 to 45 percent is deducted for standard CD expenses like packaging and promotional copies -- expenses that obviously don't exist in the online world.
As one rock manager computes it, if a consumer buys the standard Gold Plan on Pressplay, paying $19.95 for 75 songs downloaded to a hard drive and 750 streamed so that they can be heard only once, an artist, after these deductions, gets $.0023 per song downloaded. To earn a penny, more than four songs must be downloaded.
"I did the math with several other managers and lawyers, and the labels and Pressplay get just under 91 percent after they've paid all the artists for all the downloads," said Jim Guerinot, who manages No Doubt, Offspring, Beck and Chris Cornell. Other managers come up with other figures that they say are even worse for the artists.
The artists' managers and lawyers say the record companies have not committed their payment system to writing.
Representatives for Pressplay and MusicNet said that the payment schedule was a decision made by the labels. "Pressplay licenses its content from record labels and in turn packages the music on our service," said Seth Oster, a spokesman for the company. "The compensation of artists takes place at the label level."
"Pressplay was developed as a legitimate service to make sure artists' rights were respected and artists were compensated," he added.
A spokeswoman for MusicNet said, "We are deeply committed to artists' rights and to ensuring that copyright holders are compensated."
Another irritant for the artists, several lawyers and managers say, is the distribution of the $170 million settlement from MP3.com, an Internet company that offered a music storage service in violation of copyright law.
The labels were to share that money with artists whose music was put online without authorization, but several artists' representatives said nothing had been distributed.
Spokesmen for Sony (news/quote ) and BMG said those companies were arranging to distribute the money. According to Warner Brothers and Universal Music, the money has been distributed, although it may not have been spelled out exactly in the accounting statements artists received. EMI did not call with a comment.
For many acts, suddenly there appears to be little difference between the illicit file-sharing system and record-label services.
The arguments the labels are using, said Jill Berliner, a leading music lawyer, are exactly the ones Napster made. "And, from our perspective, if the technology is going to be out there and the artist isn't really going to make money, we'd prefer that our fans just get it for free," she said.
Another complaint is that the labels are licensing music to the subscription services without seeking permission from the musicians.
"All of a sudden this thing launches," Mr. Guerinot said, "and myself and a lot of other managers and lawyers had never even been asked about it. We have coupling rights in our contract, which means they can't just take our music and put it wherever they please. When I try to talk to them, they say that they don't have to discuss this."
Mr. Guerinot said he sent cease- and-desist letters on behalf of Offspring, Beck and No Doubt. As a result, he said, music from No Doubt and Offspring was removed from Pressplay, but not the music of Beck.
One manager of million-selling acts, speaking on condition of anonymity, said: "We've written them letters and put them on notice up front, as did most managers and lawyers, saying, `Don't put our artists' music up.' But they'll do it anyway. They're so arrogant. They're taking the position of: `We don't care. Let's just do it without asking.' They're ignoring their contracts. It's ridiculous. Obviously it will be litigated."
Some managers, however, said that they felt bullied into including their music on the services and were powerless to do anything about it. "Of course we're upset about it," said the manager of one male artist. "But he hasn't even turned in his record yet, so what leg do we really have to stand on?"
To try to avoid future protests, most major labels have added a clause to their standard recording contracts allowing the label to sell an act's songs on the Internet, including all subscription and pay-per-use services. It is very difficult, said Mr. Stiffelman, for a new band to have enough leverage to remove this clause from its contract.
If you say "I'll probably get modded down for this..." then I will mod you down.
Start the "label" with the knowledge that records are primarily promotional tools for bands, and design the business with as little overhead as possible and to be as artist-friendly as possible. A real "internet-only" record label wouldn't make a whole lot of money, but it might be able to attract a fair amount of attention from artists if it played its cards right: sharing small profits generously might well work out better for most artists than sharing miniscule fractions of large profits.
Of course, doing this would only further extend the Clear Channel monopoly.
mea culpa. I'm seeing more zeros than are really there. (Story of my life...)
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by wiredog ;)
No, it's thousandths.
by b0r0din
Tenths of a penny.
Wirdeog, meet b0r0din. B0r0din, wiredog. After you two are done figuring it out maybe you can compromise on 23 hundredths of a penny. You know, the actual figure.
This is the Mechanical Royalty which is paid to the songwriter, not the performer, and is a publishing royalty. The minimum is 7.1cents/song, if the song is long (I think over 5 minutes) they are paid even more. This, I presume, would be paid on top of everything else, because they are not necessarily paid to the same people.
No, it's hundredths. It's (ten) thousandths of a dollar.
Virg
The arguments the labels are using, said Jill Berliner, a leading music lawyer, are exactly the ones Napster made. "And, from our perspective, if the technology is going to be out there and the artist isn't really going to make money, we'd prefer that our fans just get it for free," she said.
Hmm... I wonder. It sounds like a threat just to get the labels to share, but could we really see artists coming out and endorsing free music sharing? Well, I doubt we'll see Metallica doing a 180 on free music downloads.
The main problem as I understand it is that the labels pretty much controls the major arenas. Bands that grow beyond club size need the labels or they won't ever see the stage of a major arena. Flaunting the major players will assure that a band, no matter how many CDs they sell online will never get to play before the big crowds and make the big money. Perhaps this will prompt more of the big bands to take on the labels and change the way the whole industry works and break the control the labels have over the arenas. For the sake of the small bands, I hope so.
-- If god wanted me to have a sig, he'd have given me a sense of humor.
Admit it. The first time you saw someone download something from Napster/GNUtella/whatever, you had a pang in your gut that said "Isn't there something wrong with this?" It's called guilt.
I think you are overestimating guilt here; the only ones feeling it are the misguided "moral" prudes who feel pangs of guilt when they fast forward commercials.
In reality the first thing most people thought when they meet napster et. al. was "man those downloads are kinda slow, and some of the songs are truncated or low-quality"
Non-commercial private sharing poses scarce threat to copyright holders if the would JUST MEET DEMAND. How long does it take for someone to offer affordable high quality-low hassle subscriptions to digital media? Simply on the books copyright law is enough protection, more than enough- all this SDMI crap is a collosal waste.
Until someone steps forward to meet demand, there is little room for "guilt". The longer they delay, the more effort is put into filesharing regardless.
Tenths of a penny. Still, not a lot considering the artists' own creative talent in most cases (*cough* N'Sync) goes into it.
Which reminds me... N'Stink etal don't write their own songs, so who gets compensated on pressplay, etc? How does that work?
Damnit, Jim, I'm an anarchist, not a F@#$!^& doctor!
Record companies are making one simple mistake. People who like big name artists need their music 'pushed' onto them, a la radio and charts, and MTV and yadda yadda.
.. like, how much of the music they were pushing around were big label artists. I'd venture that big names didn't do to well in an environment that encourages the discovery of new music.
There is no way the artists that make it big with the casual listeners, those who need to be told what to like, what is next, who is big, will make it big in an evironment where the listener must go out and 'pull' music from interactive sites.
We should have gotten some stats from Napster
Discovery and self-education, is, of course, the bane of media big business.
"Old man yells at systemd"
Maybe the artists who want their music off can arrange a DMCA raid on Pressplay.
I submitted this yesterday and it was rejected:
2002-02-18 15:32:33 Record Companies Facing Revolt of Artists (articles,music) (rejected)
I've read all the FAQ's on submitting (several times) and try as I might I cannot get a story accepted on this site. It makes one wonder what other stuff gets overlooked in the submission queue.
More to the point, it makes me wonder what issues are important to the editors of this site but which are not being clearly articulated in the FAQ's on submitting. I.e. I must be doing something wrong, but for the life of me I can't figure out what.
I wouldn't mind the music tax so much, if the record labels put more towards programs like save the music or other programs designed to increase/improve music studies in public schools. The labels are such hypocritical money hoarding sharks. The legal system needs to seriously slap the labels upside the head.
1) You're all against this, it rips off artists.
2) Previous article is about shortening copyright limits so that artists work become public domain sooner and everyone is for that.
(I'll concede the possibility of their being two completely separate sets of people replying to each)
But it seems to me that between the users that pirate, the record companies that take 99% of profit and the open sources that think "14 years of copyright on an artistsic work is enough" that absolutely everyone is out to rip off the content creators! It's a univers of succubus.
Well (pardon my french) but screw you all! Someday (god, government and geeks willing) artists and content creators will actually obtain real power over their work. They'll say who can have access and at what price. If they seem unfair then people will tell them to fuck off. If not, people will buy their product. If you don't like their terms on their own creations then there is only ONE thing you can do about it (morally), and that's to walk away. Anything else is just plain wrong.
Contrary to popular belief, coding is not all free blow-jobs and beer. Those things cost MONEY!
Non-commercial private sharing poses scarce threat to copyright holders if the would JUST MEET DEMAND.
This is way too optimistic.
I'll be honest. I have a lousy job. I don't make very much money. There's a temp agency taking $4 an hour from me just for finding this lousy job for me. I am absolutely not going to pay for music (or software, or movies) unless I absolutely, absolutely have to.
I believe that there are a lot of people like me. Those of you here on Slashdot who are saying that people are willing to buy all their CDs from Tower if they were only $6 are, I'm convinced, a vocal (and affluent) minority. $6 is still too much to spend on a CD when you're searching for loose dimes to pay the rest of your DSL bill.
"Beware he who would deny you access to information, for in his heart he deems himself your master."
Although Pressplay and MusicNet license the music, the bands are not paid a licensing fee. Instead, the labels pay their artists a standard royalty for each song accessed by a fan, as they would for a CD sold. This means that the artist gets on average less than 15 percent instead of 50 percent. But, out of that, 35 to 45 percent is deducted for standard CD expenses like packaging and promotional copies -- expenses that obviously don't exist in the online world.
And:
To try to avoid future protests, most major labels have added a clause to their standard recording contracts allowing the label to sell an act's songs on the Internet, including all subscription and pay-per-use services. It is very difficult, said Mr. Stiffelman, for a new band to have enough leverage to remove this clause from its contract.
In other words, the bands' lawyers are arguing that the music label contracts give a royalty for each copy of the song sold, and a license payment for each instance of the song used but not sold. Future contracts will probably alter this, but the bands feel they deserve a higher license fee instead of a tiny royalty -- which is cut further by CD packaging expenses which the online world doesn't have.
Bands do not "sign away" all the rights to their songs when they record with a label. They retain the right to a cut of the profits. The argument here is that the cut they're getting is unfairly and possibly illegally small.
Wouldn't it be pretty easy to rig some kind of machine (or beowulf cluster) to keep downloading your own song, over and over? It couldn't cost 23 cents in bandwidth and hardware to download one MP3, could it? How many of your own 2.5 meg MP3s could you reasonably download in a month over a T1 that was costing you $450?
"Beware he who would deny you access to information, for in his heart he deems himself your master."
Sure, the record companies are ripping off the artists. But isn't that exactly what happens with filesharing, only more so? How does that make filesharing acceptable? To me it looks like people engaging in filesharing are just as bad, if not worse than the record labels. And hypocritical about it too. After all, at least the artists can try to negotiate with the record labels (as this article describes). Not mention that the artists are free to set up a co-operative or their own labels, or whatever. Of course the filesharers will just rip the product of the cooperative too.
Besides touring, you can use alternate methods of distribution such as: net downloads or you can even cut your own CD's and sell them through an online store. Basically, there is no reason for artists to be so dependent on record sales.
Never trust lawyers to do math...
Managers either.
Why is Grand Theft Auto a much more serious crime than Reckless Driving?
Yeah, but this time around, the labels are getting paid for it!
If RIAA doesn't get its cut when the artist gets fucked over, the terrorists have won!
The record industry STILL doesn't want an online distribution method. They have done this KNOWING that the artist will protest and that it will not make money. They will then take it down. They then will have successfully stoped p2p sharing (napster) AND not have to distribute music online.
It's just a red herring.
"...He added that it was "beyond logic" that artists would choose to leave their music off Pressplay and "effectively encourage the use of illegal services." ..."
Or, Record Companies can leave it on Pressplay despite cease-and-desist orders, thereby effectively encouraging the use of illegal services.
As one poster has already mentioned, at least with Napster somebody was listening.
This one line really stood out for me. I think that it means the revival of Napster in all its glory. At least with Napster, artists can actually connect with their audience without the intermediary of a bunch of real pirates.
For most artists, the real threat to their attempt at a livelyhood aren't the people swapping 64kbit MP3 files, its the recording industry.
A well-crafted lie appears unquestionable - Dama Mahaleo
I didn't get into Napster, but some time a long time ago somebody gave me a compilation tape.
Due to having listened to that compilation tape, I've probably purchased 30 CD's and LP's all told, of The Residents and Yello, and I still look in every record store I see for a copy of anything by The Flying Lizards (so far unsuccessfully).
Now, how exactly does this amount to screwing over either the artists or the record companies? They recieved considerable money from me that they otherwise would not have, had someone not given me an illegal compilation tape.
Actually, I already own the majority of the music I want to listen to. Oh sure, something new comes out that I like every now and then -- but over 90% of what I want to hear, I already bought on cassette tape or CD in the past.
When I download MP3s from the net, I often grab the same songs I already bought once, on tape, because my cassettes are old and wearing out.
Other times, I grab individual songs I happen to like, from newer artists that haven't put out anything else that I was impressed with. No way I'm going to buy a whole CD just to get one good song unless I absolutely have to. That's not about me ripping off an artist; that's about the artist ripping me off!
The company is still footing the bill up front. If the record doesn't sell, the artist hasn't lost anything (and actually gained quite a bit).
I'm not supporting the record companies, but the fact remains they still record and produce artists who wouldn't have otherwise been able to to make it.
Stupid sexy Flanders.
I've been using OMDs (internet Original Music Distributors) for some time now- was with mp3.com for a while until they got bought out by Vivendi and changed their contract in really negative ways, have stuff on BeSonic, and now I'm setting up shop on Ampcast.com.
I get FIVE CENTS per full download from Ampcast. (This is why they have you register- otherwise artists would cheat)
That is more than twenty times the royalty the RIAA is willing to pay...
Why, how? First, Ampcast really wants to be selling its CDs (a primary reason I like them so much is that they burn-to-order from genuine (rippable) Red Book CDs. The one I have for sale there is a Red Book, full 44.1/16 from high-resolution masters (done with my GPL mastering software Mastering Tools), I'm trying to negotiate a cooler tray-liner artwork but it's 'live' and buyable right now. If you buy one, I get a few bucks, and Ampcast gets a few bucks, and the RIAA gets absolutely fscking nada, zip, zilch, zero, thank you for playing. Secondly, Ampcast ain't a free OMD or trying to be one. It charges a fee like a hosting service, and that's where those five centses come from, plus from the CD sales. They're good that way- they have sense and have managed their budgeting intelligently so they have control of their business.
I'm still putting up other work and remastering my back catalog, but go check out 'Full Day', buy the CD (with a little bonus track not listed on the page) if you like it. And then ask yourself: is it fair that RIAA major label artists get a less than a twentieth of the download-royalty I'm getting from Ampcast? That _stinks_. The RIAA has _more_ money than Ampcast! They could well afford to do a HELL of a lot better than that. It's pathetic, outrageous, insulting. I'm not saying my music isn't as good- I put a lot of work into it- but TWENTY times as good? I think NOT... yet that's the discrepancy in pay.
By the way, if you don't like the idea of me getting paid off downloads, the streaming plays don't pay anything, you could check out those. Or, if there are people who've bought the CD, I write right on it "please copy this CD for your friends" and it's totally rippable, so you could look for the tracks on Gnutella or something- I hope people do share my music that way. If someone has a problem with dealing with Ampcast registration etc. and wouldn't buy my CD anyway, they should still be able to have mp3s of it... I don't need their nickel that badly that I should insist on putting them through a hassle...
Artists today make virtually nil on CD sales anyway - the record industry takes 90% or more.
I found a good resource on record contracts that shows how badly artists are ripped off by the record companies. Particularly interesting I thought was the section on "recoupment" - where a band must first pay for all the costs of recording their album before they get a royalty check! So the band are being "commissioned" to produce artwork that they themselves in the end fund, but will never themselves own!
Who makes the money? Don't be fooled: the people who market the music make money, not the people who create it. Period.
Linkin Park has a fairly large number of tracks on mp3.com. Their album has received almsot 2.7 million views. In compensations they have received $52,831.15 which works out to 1.9 cents per play. Now not all of their tracks qualify for mp3.com's payback for playback deals, but even with that technicality they are receiving about 8.5X the roalties this industry cartel driven system would have given them.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
Other times, I grab individual songs I happen to like, from newer artists that haven't put out anything else that I was impressed with. No way I'm going to buy a whole CD just to get one good song unless I absolutely have to. That's not about me ripping off an artist; that's about the artist ripping me off!
No... That's still _you_ ripping _the artist_ off.
A: None. The Universe spins the bulb, and the Zen master merely stays out of the way.
Hardware: $25k (one time)
Net connection: $10k (monthly)
Backend+HTML: one week coding
So there it is, $35 grande (plus or minus) and one week later a website could be up and fully fuctional selling artist songs direct, no record label necessary. I would guesstimate this would easily support 100,000 unique views and the costs would be minimal to expand with popularity.
Now if only someone could convince some rich musicians to fund this, turn into a non-profit and offer its services to any other artists.
Attn current musicians: Sooner or later your contact will expire. This artist-run-website idea can be used to position yourself favorably if you wish to re-negotiate your contact. Or better yet, to free yourself from the labels.
Attn future musicians: Record labels offer two things. Producing your album and distributing it. Find an alternate way to produce your album (really, not that hard) and now you are free negotiate anything with anyone.
If the artists help themselves, the labels will be at the artists' mercy (like they should be). If they don't, artists will continue to whine until they are blue in the face about their penny per album (meanwhile enriching the old guys who have a corner office). The tech community has empowered you (the musicians) to throw off the shackles of a system that (sorta) made sense in the 50s and 60s. The choice is yours. Like the matrix, we can show you the door, but you got to walk through it.
Prediction: Nothing will change. Most musicians will prove the stereotype that they are lazy can't-hold-a-real-job types willing to sell their soul to the devil to be famous. Not that I equate the music industry to the devil, but if the devil was in the music business I am sure he would have no problem signing musicians as long as the promise of fame is there.
But see, the counter-argument to your point is that "nothing is new, under the sun".
A person who "creates content" didn't really do it completely on his/her own. He/she had to learn the skills and tools from knowledge passed down by others - meaning it's never truly 100% an individual effort. As much as humans like to say we're "independent" creature, we're much more "interdependent".
Like most things in life, the truth is someplace in the middle. I think this goes for content creation, too. An author of content/intellectual properly deserves to be rewarded for his/her work. Nonetheless, giving him/her "absolute power" over it doesn't benefit anyone in the long run. It's too extreme of a solution -- and runs counter to the truth I mentioned above, about all of us being interdependent beings.
Even Civil Libertarians should note that Thomas Jefferson himself believed in limitations on terms of copyright; he feared that doing otherwise would stiffle innovation and become counter-productive to humanity.
IMHO, the music industry is dangerously close to removing all compensation for the artists. If it gets any worse, music will not be a viable profession. As a Republican, I don't have a problem with that. There will always be "amateur" or small-time musicians. For these people, music is more of a break-even hobby than a profession. If they all distribute their stuff for free or cheaply via P2P, they will do no worse than what the music industry would have offered, and a few of them will be interesting enough to take away market share from the record labels. This will further deplete their supply of indentured servants. By trying to keep 100% of the pie, the recording industry will eventually have 100% of $0. The sooner they hit bottom, the sooner the free market will correct this out-of-balance condition. Finding a way to pay the artists is a fairly difficult problem. Fortunately, we don't need to solve it yet because the record companies look like they have no intention of paying the artists anyway.
People are sure to wonder "Who would make a product and then give it away?" Open Source programmers give away all kinds of software -- they certainly have attracted Microsoft's attention! Open source is one of the few things that can keep the M$ monopoly from getting totally out of hand. I see no reason why "open music" would not have a similar impact on the recording industry.
In related news, Napster settles all of it's lawsuits by sending the plaintiffs an old jar full of pennies found in the attic.
This isn't a communist nation or a dicatorship people. The artists get themselves into these contracts. If they don't like it, then don't do it. Simple.. get a real job like everyone else. The fact is that the record labels KNOW they can find suitable talent willing to work for basically nothing, and until that changes (this is basic economics after all) then what exactly are they doing wrong? Its like a worker at McDonals. Teenagers are willing to put up with quite a bit for 5.15 an hour so McDonalds has no incentive to pay them more. Rock stars are willing to work for similiar, and so the labels don't have to pay them more. Good for them.
Turn s60 photos into awesome videos with mScrapbook for all S60 3rd edition phones!
When I download music from Napster/Gnutella for free, listen to it, and then buy CDs with the music I like, I'm helping the artist.
I think that the artists whose music you didn't buy would have a very different opinion about what you are doing.
This is no surprise - labels have always screwed the artist on recordings. It's partially justified because they have a big marketing force (i.e., could get you into a lot of playlists of stations owned by ClearChannel) but the excuse they used for ripping off artists on CD's is the cost of creating and shipping those CD's. Now, internet distribution is so much cheaper (not free, but very very cheap) and they're making less money.
So where do artists make their money? Gigs. That's the way it should be, in my opinion. If I buy an album, the band gets a few cents. If I go to the show, they get a few dollars. If they do a show and 5,000 people show up, the band gets at least $5,000 for the day. 50 shows in a year and each musician in a five-piece band get a $50,000 salary. And these are low estimates, too. I do about 50 gigs a year and I still have a day job.
I know a lot of people who are professional musicians, but not famous. If you're in a wedding band, you can pull in $200 per member per gig, and if you're good enough, you can probably get 2-3 gigs per week (or more). $600/week + free drinks is not bad for 4 hours/day, 3 days/week.
But then most of the famous musicians aren't as good as professional musicians. They generally start out playing in small bars, then move up to larger bars, then usually they stop there, but very rarely they move up to being "famous." They still need to work for their money though; meaning the labels don't pay them enough for CD sales so they have to go out and play live. CD sales (and net music sales) should be viewed as a marketing tool used by artist to get fans to come to their shows. If I could give 4,000 copies of my album away and know that 1/10 of them would go see my gigs, I'd do it!
I really hate signatures, but go to my website.
this is just an example - all money is USD all figures are conservative but speculative.
my favorite dj/producer performs at clubs ranging in sizes between 1K - 5K. he seems to charge an average of 10K per set and seemingly performs at least 100 times a year. so the math comes to around 1 million dollars a year for touring.
he also produces records, which I buy for around 7 dollars apiece. though I am cluless about the economies of vinyl, I am positive heis making money off these pressings.
he currently has one mix cd available for purchase, and I own it. I could have downloaded it for free but the quality isn't as good. I have at least 15 mixes that I downloaded from the net of live performances at clubs, these were free, but the key point is that having them (even if they were high quality wouldn't keep me from going to hear him perform live because each performance is different.
so based on these numbers... even if you take away 70% for taxes and travel and business expenses, he should be getting at least 300K per year. not too shabby.
all of this was accomplished without selling to the majors and reputation was built on word of mouth or sound of music, no bullshit advertising.
sorry if I rambled and for the excessive use of "at least".
ps. he plays the 909 like an instrument!
(1) those who admit they download or rip music, but claim they either own all the CDs they rip, and/or that they buy more CDs, or more diverse CDs, as a result of downloading; and
(2) those who claim they never download or rip music, but insist that those who do are simply opportunistic freeloading teens downloading or copying Britney/N'Sync, and deny that category (1) exists.
What is striking about this duality is that the people who actually do rip/download would seem to be in a better position to report why they are doing it, as compared to those who have never opened a Gnutella window or ripped a CD. Personally, my girlfriend and I exemplify both classes of category (1) very clearly - she rips our CDs so she can make us mix CDs for the car/gym; I try out mp3s of new music, and buy the CD if I like it; we both rip some CDs so that we can play the tracks on our computers with visual displays such as I Tunes and Winamp plugins. And we would jump at the chance to convert our large (approx. 3000 CD and 500 LP) music collection to a high fidelity, all digital format that could be databased, searched, and easily played on our audio gear as well as the computer. Ironically, although such capability would enable us to buy even more CDs than we already do (we are running out of CD room in the house - seriously), the music industry seems determined to ensure that this never can happen.
Isn't there some way to obtain empirical data to determine whether (1) or (2) is the most valid world view? For example, could a program be devised to crawl out over Gnutella and track and compile download frequency data of file names, to see whether most downloading is focused on the big money pop groups as the industry claims? If that's too scary, could some university department with expertise in such things conduct a reliable blinded survey, or arrange a study of this behavior? When the two sides of the debate have such different perceptions about what is actually occuring, it's difficult to see how progress can ever be made.
And if I'm right (as I suspect) that category (1) users actually predominate, and that many category (1) users are actually serious music buffs like us (and are the industry's best customers, I would think), it is possible that the RIAA and its government backers would be given pause. I mean, I was a teenager once, and how much music could I afford to buy then? None. I admit that in those days I shoplifted a few 45s and LPs I desperately wanted and couldn't hear on the radio, and even though I would gladly have paid if I'd had the money, it still wasn't right. But I have paid that back with thousands of legitimate purchases as an adult. One would think that the music distributors would look at downloading the same way - it is the soil in which their best future customers grow. I find it hard to believe that teens who get their jollies downloading Britney (or other such slop) and copying it for their school clique are ever destined to become music nuts such as myself. The industry would be better worrying less about squeezing the last penny out of Britney drones who will probably never buy a single piece of music after they leave college, and worrying more about how much money they'll lose when people who purchase hundreds of CDs every year swear off Universal and other labels that cripple our music. My girlfriend and I have already done so.
No, no, no. This is not a sig.
I think the best example of what MP3's can do for the music industry id Linkin Park. Las year, guess who sold the most records and CD's? Britney? Outta synch? Backdoor boys?, nope it was Linkin Park, a band that formed ::Gasp:: on their own! But surely Linkin Park Must have been spotted by some smart record exec and signed immediately. Nope, in an intrerview in the jan 28 issue of time, the band says that WB turned them down the first time they tried to get a deal, so what they did was plaster their MP3's all over the internet. They would go into chat rooms and pretend to be random people, saying "hey, have you heard the great new band linkin park" or something to that effect. Eventually they built up a legion of loyal fans through mp3's and the net, and THEN they were signed by WB. Would they have been able to do this without MP3's? maybe, but they sure made it easier. And WB certainly wouldnt be sitting on the goldmine they are neow, afte rall they turned down the band the first time!
Well, where do I start?
Well, it's not called "ripping people off," it's called investing. Record companies put up a huge amount of capital to produce records, market bands, and finance tours. Because there's a great deal of risk involved in promoting musicians, the recording industry demands a very high rate of return. Yes, the musicians create the content, but without financial backing, you never would have heard of Metallica.
Investing my ass, if anyone but the record labels did what they do, they'd be hauled into court for loansharking and racketeering. Oh wait, that's already happened to them...
Per the high risk of modern music and need for a high return, you're right. In fact, just like small businesses, they're quite risky. Guess what? If I get a loan for my small business, I make 100% of the money that customers pay me, and then I repay 100% of my loan from my proceeds. If I'm a signed musician, I get 7% of the money that customers pay for me, and then I repay 100% of my record company loans from my proceeds. Do you see a problem with this equation??
Band contracts last for a set number of years, and during that time, the record company will spend a gratuitous amount of capital promoting them.
WRONG. Contracts last for a set number of *albums* - there is absolutely no year limit. Also, the record company will *not* necessarily spend a given amount of capital promoting the artist - they will typically have X$$ to promote 10 groups out of the 20-30 they signed that year. The others will be cut at the end of the year.
Once that contract expires, the band typically retains the band name, for which a tremendous amount of branding work has been done.
If you're one of the 10 out of 30, some branding work has been done. Also, most contracts don't expire, the artist is flat out dumped from the contract. For those contracts that do expire, sure the band retains their band name, but they have no rights to their music or lyrics - the label owns those for at least 35 years at the minimum unless they auction them off to the highest bidder - who then keeps the copyright on the artists' material for the life of the auuthor plus 95 years.
They can take their brand and cash in on it themselves.
Riiiiight, you're talking about less than 2% of all acts signed to the major labels by this point. By the way, if they play their songs in concert, they have to pay the label for the rights to play their songs - because the songs don't belong to them. They belong to the label. If they create a Greatest Hits album, 90-93% of that money goes to the label. That's cashing in, right?
The end result is that bands that have longevity
You're on a roll now. Through la-la land.
will eventually get to live a fairy-tale existence, riding off into the sunset with millions and millions tucked away into their mutual funds.
You mean Waylon Jennings? Merle Haggard? TLC? Guess what, between all of them, they have never received a royalty check despite selling tens of millions of records and CDs.
Let me just say that, while I sympathize with people like Courtney Love, I won't shed a tear if she ends up with $15 million in the bank instead of $35 million. She can probably have her chauffer start clipping coupons out of the Sunday paper to help her make ends meet.
Are you a record company shrill? You speak like one. Courtney Love and Hole are not mega sellers, and likely will make less than $1 million net for their careers, divided by 4 members *and* 8-10 years. That comes out to $25,000-$31,000 per year per member before taxes - if they're lucky. 99% of all artists signed to the labels will not see a royalty check - coupons will be a necessity for them.
Personally, I'm looking forward to the internet and technology advances equalizing the revenues of the entertainment industry, as high-quality audio and video content becomes ridiculously cheap to create and distribute.
In theory, technology and the internet should force prices down, but many of us know they won't. It will be ridiculously cheap for the LABELS to create and distribute, but those savings will not see their way to either the artist or the consumer. Those ever-cheapening prices *will* help the independent artist who avoids the labels like a plague, thank God.
What a troll.
What a massive surprise. Hardly even worth reporting on- anything made by these folks is going to fuck someone, even if it's themselves.
What we call folk wisdom is often no more than a kind of expedient stupidity.-Edward Abbey
Hmmm... So I owe Frank Black 9 cents??
Culture Club's entire output could be had for under a dime.
The truth of it is, these artists signed bad contracts. I know all of the arguments that the buisness is just that way, etc... These people wanted to have their music published so badly that they signed bad deals to do it.
If they re-broadcast Jerry Springer via the net, should the guests of the shows be compensated?? They won't. They wanted to be on TV badly enough to sign a bad contract.
Music is not scarce, music publishing is. Besides, most of these jokers would still be nobodys if Sony, Warner, et. al. hadn't paid Clear Channel so much to get them radio play.
Being a musician is about making music. Being a professional musician is the alchemy of turning music into gold.
~Hammy
Oh, look, I found a quarter! I can finance my entire Weird Al collection!
"You're never ready, just less unprepared."
... Once you think they've done their worst, they one-up themselves. First they claim that it's wrong to download music because you're stealing from the artist. (Like any of us believed that they were sincere.) Then they set up a site where it would take them over 5.2 million downloads a year just to match a $6 per hour burger-flipping job. And when the artists and managers tell them "We don't want those songs online, take them down," the RIAA doesn't even give them the dignity of a real response.
In RIAA's eyes, the artists are cattle to be milked for all their worth so that they (the RIAA execs) can get as fat as possible. And when the cow (artist) stops producing milk (profits)? Just dump them aside.
At least the fans downloading/sharing the MP3s illegally had the decency to appreciate the artist's work. I think we'll start to see "Round 2" of the online music wars pitting artists against the RIAA. "Round 3" will be a lot more interesting if the artists win.
My sci-fi novel, Ghost Thief, is now available from Amazon.com.
Breakfast served all day!
This is a wonderful example of why vertical marketing sucks in the entertainment industry in general and in the music & movie industries in particular for the consumer.
Vertical marketing, for those more familiar with a Unix prompt than corporate strategy, is the positioning of your company such that you control all aspects of production & distribution for the life of your product, from soup to nuts per se, or from artist to consumer. For example: in the beginning of the movie industry in the 20's - 30's, Edison had a vertical lock on motion picture production and distribution. Through patents he controled both the ability to make movies and the ability to show movies. There were Edison theaters, and you had to have Edison cameras to make films (at least in the US). The result was that he could charge the movie companies whatever he wanted to make a movie, then he could force them to show them only in his theaters, and at prices he decided. In a free market the owner of the technology (Edison) and the owners of the talent (studios) needed each other. but because Edison had a lock through patents the studios had nowhere else to go. Eventually he was forced to divest the theater business to people like Loews, etc.
How the story ties into the music industry is thusly. The music industry has been vertically integrated for a LONG time. They find the talent, produce the product, and control the distribution to retailers. Only what's hapenned to them is that because of innovation the nature of the product has changed in people's minds. People now know that music isn't a piece of magnetic tape or a little plastic disc. It's a piece of information.
Crushing Napster/KaZaa/Morpheus is vital to the future of the big 5 companies for this reason. It's has nothing to do with "piracy", because there's never been any evidence of a hit to their bottom line -- in fact, they've been raking it in over the past 5 years. It's about crushing your competitors and bad-mouthing the very innovation that's threatening you (thus you get the MP3 = piracy thing), introducing your own service that essentially does the same thing, and thus staying vertically integrated. Hell, my bet is they don't even care about downstream sharing as long as they're controling the original source.
Fucking over the artists is just a sideshow - icing on the cake. It's really about staying a small group of very big companies who make money by controling what you listen to.
The only tool you've got against psychosis is experience.
From the FAQ:
Do musicians and labels get paid for the MP3s I download?
Yes. EMusic splits all of the profits from membership fees 50/50 with the label or artist. EMusic is a legitimate downloadable music service that compensates artists and labels for their work, without sacrificing convenience or low-cost.
A bit light on details, though, but I'd assume the artists get more than pressplay's paying.
--- Work, worry, consume, die. It's a wonderful life. -- Bill Griffith
Per the high risk of modern music and need for a high return, you're right. In fact, just like small businesses, they're quite risky. Guess what? If I get a loan for my small business, I make 100% of the money that customers pay me, and then I repay 100% of my loan from my proceeds. If I'm a signed musician, I get 7% of the money that customers pay for me, and then I repay 100% of my record company loans from my proceeds. Do you see a problem with this equation??
/.'ers make it seem to be.
Yes, I see a big problem. Go walk into your local bank and ask for a $7 million dollar loan so that your band, StinkySkivvies, can record an album and then go a world tour.
What? They didn't give it to you? Wow, finding capital must be harder than
WRONG. Contracts last for a set number of *albums* - there is absolutely no year limit. Also, the record company will *not* necessarily spend a given amount of capital promoting the artist - they will typically have X$$ to promote 10 groups out of the 20-30 they signed that year. The others will be cut at the end of the year.
Ok, so the artists who are truly talented get to enjoy a nice long career, and the one-hit wonders get to live the life of their dreams for a year.
Is there a problem with that? I'd quit my dayjob right now if I could go travel around the world and play my ukelele to packed arenas for a year.
It's no different than what happens in the business world. Some entrepreneurs have staying power, most don't. Oh well. Ride the wave while you can.
You mean Waylon Jennings? Merle Haggard? TLC? Guess what, between all of them, they have never received a royalty check despite selling tens of millions of records and CDs.
Really? You mean they've never sold their images for mechandising? Never had TV or movie opportunities? Never went on tour?
Wow, it really sucks when you don't know how to capitalize on a brand, doesn't it?
And since I don't have the means of verifying your comment, I'll leave it at that.
Are you a record company shrill? You speak like one. Courtney Love and Hole are not mega sellers, and likely will make less than $1 million net for their careers, divided by 4 members *and* 8-10 years. That comes out to $25,000-$31,000 per year per member before taxes - if they're lucky. 99% of all artists signed to the labels will not see a royalty check - coupons will be a necessity for them.
Read my prior comment again.
Love may or may not be getting much in royalties, but her record company has made a tremendous investment in the Courtney Love brand, something that they can't take away from her. If she hasn't capitalized on it, then its time to fire her manager and hire someone with some competence.
I wonder how far we are from an artist that has a breakthrouh hit that is on a CD produced at home?
Get Cakewalk or any of the current audio tools, a decent sound card, and decent mics, fix your garage up a bit, and there you go. Cost of probably around $2,000 total.
Going with a big company, you get a fancy studio and a producer, who will help you make your track sound just like everything else out there. (Okay...where would Def Leppard be without Mutt Lange - I'll concede that!)
Then again, some of the stuff I listen to on a regular basis either a) was recoded on a shoestring like this, or b) was recorded a while ago and the recording quality is probably the same as what can be done at home now.
Then again, I am also sick of all the overpolishing done on most modern stuff.
is available from The Future of Music Coalition, in PDF format, that explains in plain english what the various terms mean. The file can be found here
I always thought it was called a Verticle Monopoly. As in oil tychoon Rockefeller owned several oil wells, owned some rail to transport it, and some processing plants to turn crude oil into a useful form. This kind of monopoly is not illegal, but rockefeller ended up with too many oil fields, and used the profits to expand "horizontally" along the rest of the chain.
I Browse at +4 Flamebait
Open Source Sysadmin
that the RIAA and the MPAA aren't the same small group of people? Gee, you have a lot to learn.
-- Never make a general statement.
Comment removed based on user account deletion
I stand corrected. I wouldn't have thought it possible they could pull off a live performance. Guess I should have checked. Wierd. Well, it sounds like they should still work on it some, particularly for encores - if you're gonna perform you gotta have flexibility. And perhaps maybe the spectacle should go beyond one screen (multiple screens?)
---If you can't trust a nerd, who can you trust?
People keep telling me that there's this thing called "the free lunch" out there, but I have yet to find it... sigh.
No, it's called "ripping off." You know why? Most artists get FUCKED. Many end up in debt, between the cost of recording an album and everything else that goes into it. It's all usually calculated into their 'salary,' so if the artist flops, they have to pay for it.
Ancient Chinese saying... "You can't get fucked if you don't spread your legs" (ok, I just made that up). The artists have everything spelled out in front of them, and if they don't understand it it's their own fault for not seeking out counsel. If they get fucked, it's because they see the dollar signs in their eyes and not the realities of engaging in business.
If I were to release an album on a major record label with a typical contract and sell 50,000 copies, I would lose money (considering that it was an expensively produced album-which most are these days). If I hadn't gotten an aggressive percentage of ticket and paraphenelia sales(which most artists don't) and then decided to put on a good show for my fans, the record company I'm signed to would make a lot of money, the venue would make a fair deal, and I wouldn't make hardly any- because tour costs would fall on me.
Bad business venture on your part, eh? Then why are you doing it if it sucks that badly?
Obviously, because the potential reward is so great. Those are issues that the business world looks at every day -- "How can I get the greatest reward for the least risk?" How much risk are you willing to tolerate? It depends on the potential reward.
You wouldn't put up with that kind of abuse at McDonald's. Why? Too much risk for too little reward. BUT... if you had the potential to be the next U2... ok, then you're probably willing to take on a LOT more risk. But ultimately you, as the band, decide whether or not to take it on, not the record company.
And if you have misjudged your greatness, then you pay the same price that every failed entrepreneur has paid.
You see, major record companies don't take risks with artists. They don't invest. They are gauranteed to make back their money, even if an artist fails. The artist pays the cost of their failure, and ends up indentured to the record company.
Ever hear of bankruptcy? If an album fails, then the record company may be looking at one of three options: 1) pursue every penny and push these out of work musicians into bankruptcy (and get nothing), 2) negotiate a settlement with them and get pennies on the dollar (repaid over many, many years), or 3) write it off as a bad debt and reduce their amount of taxable income.
I'm willing to bet that option 3 happens a lot more often than 1 or 2.
And BTW, the record companies DO invest, they have potential to lose their money as well as increase it. It's only because they are big enough that they have figured out how to minimize risk on their part. They have the gold, so they make the rules. Don't like it? Then don't do business with them.
Now, Indie labels(Fat Wreck Chords, Matador, Hopeless, A-F Records, etc.) take risks. They release CD's at reasonable prices. They don't fuck the artists with the contracts. They don't make shit off of concerts, because they don't charge much for them.
Isn't competition a wonderful thing? That's the beauty of capitalism. If one company or group of companies gets too greedy, well there's always somebody waiting in the wings to eat their lunch.
So, what have the Indie labels done? They've reduced the amount of risk that the artists take on, but they have also reduced the potential reward. Again, if the artist feels that he/she has real talent, and is willing to take on much more risk, then they can step up from the Indie label.
But the bands of Indie labels aren't living rock and roll dreams with big houses. The truth is, there's a handful of people living that life. A lot of them own their own labels, or they're experienced enough in the business to force major record companies to give them fair contracts.
Oh, so some musicians with the big labels DO make big money... I've got a dozen people here telling me that they don't!
So, somebody out there is proving that capitalism works. Taking on a great amount of risk is not a guarantee of success (more a guarantee of failure, that's why it's called "risk"), but when that increased risk pays off, it pays off big.