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Musicians vs. RIAA At USA Today
An anonymous reader writes "USA Today has an article about the growing friction between recording artists and the 5 major labels which make up the RIAA. Many issues are covered, including copyright reform, fraudulent accounting on the part of record labels, and how selling a quarter million albums can leave you owing your label $14,000."
An interesting article by all means. Perhaps the time has come for all artists, new upcomers or old timers, to seek an alternative distribution model. I have often thought, considering the very slim royalties most performers receive from CD sales, that simply selling tunes direct to the customer on a website could put the power back where it belongs - in the hands of the people who have the talent.
Try NetBSD... safe,straightforward,useful.
Maybe it's just taking the artists longer to figure out what's going on. And definately a while to figure out what to do about it.
It's like being screwed by your landlord. You know you don't like it. You should leave. But where will you live?
It should be interesting as these multi-year contracts start to run out, and artists start to look for other solutions. (Unfortunately there aren't any other great solutions. Most of the good ones lack any real marketing) With sales not increasing, and artists speaking up, the Big-5 might actually have to do something.
Or maybe not. I'm sure there's always another "Korn" willing to sign their lives away for fame.
Short anecdote: This June, I'm driving to Connecticut from Jersey in ridiculous rain. I stop at a Mobil gas station and go inside to get a coffee. It's dark, rainy, etc. I walk up to the door and look at the guy leaving as I'm going in. I go, "Mike?" He says, "Yup" and walks away. It happened to be Mike Gordon (coincidently look at my sig) from Phish, driving himself somewhere in a ragged T-Shirt and jeans. Now, here's a band that has untold gobs of money and yet still drive themselves around and don't really care what they look like. Here's also a band that gives away its music to any who would want to hear it. This is the kind of band the RIAA is scared of because they don't act greedy like the RIAA themselves.
"Nature doesn't care how smart you are. You can still be wrong." - Richard Feynman
I never thought of it like this before, but that's really what happens. What's worse - there's nothing more frustrating than a band changing labels -- the old label still owns all the band's old music, which unfortunately means that they take some pretty good stuff and stick it in a basement somewhere. This is where Janis Ian's suggestion of letting artist re-release their out-of-print stuff would really be of use. Of course, that would require the RIAA to give up some control...
Boy, did she get screwed.
First, her parents signed her up with Curb Records for TEN albums when she was 12. She grossed over $300,000,000 for Curb Records. That's right, a third of a billion dollars.
When her parents got divorced, her mom got to ride horses with the WalMart heirs, her dad lives in luxury, and Leann has enough to buy herself a used car.
There are laws that are supposed to protect child stars from getting fucked like this. There isn't a single honest judge to enforce them, though. Leann is suing her dad, her label, and probably her mother, agents, and promoters. It's the judges that will do her in.
If Jimmy Buffett has his way (and looks like he is attracting some takers), the RIAA has more to fear from J.B. than from P2P. Check out this article on Buffett leading the charge against the big labels. With CD's cheap and easy to make, the RIAA and the big labels that make it up are going to have a harder and harder time justifying their existence. They can keep blaming P2P, but they'd better wake up to the fact that they can't keep treating their artists and customers like dirt -- the artists and customers CAN and WILL get together with or without them. I'm mad as hell, and I'm not gonna take it anymore -- from Fruitcakes by J.B.
Life is short: void the warranty.
I was a record producer for fifteen years and got out of the business because it simply sickened me. Here's an example:
Artists are paid a points royalty on sale of master recordings (while songwriters are paid publishing royalties on the sales of songs). 15% (15 points) is quite a good royalty for a new band, or even one with a hit under their belt.
But does that mean 15 points off all sales? Nope.
It means 15% of 90% of the worldwide gross. Why 90%?
Because in the 1940's (when the label business models we hate so much were established) lacquer records were still sold and many of them broke in shipment. A 10% "breakage allowance" was standard.
It still is. CDs don't break. But the labels, almost without exception, skim 10% off the top for "breakage" before even getting to recoupment. If IBM skimmed 10% off their earnings before issuing dividends the Board would be crucified. But music labels? No problem!
As for recoupment, the example given in the USA Today article is tame. I won't mention the name, but there is a band who has sold millions, for each of their more than five albums. But each time, video costs, recording costs, marketing/promotion costs, plane fares (for huge label entourages), hotel bills (for these same label execs) were all paid for by the band.
Sum total? They sold 35 million records and still OWE the label over 2 million dollars.
The system was devised in the 40's and has no place in the 21st Century. Hilary Rosen can whine all she wants, but the labels are truly in serious trouble due to their religious adherence to these ancient business models.
"The pie shall be cut in half and each man shall receive.....death. I'll eat the pie."
While intentionally not paying royalties is obviously fraudulent accounting. The traditional system of applying overhead to jobs also needs to be eliminated because they're charging artists for idle time that's not the artists' fault, but the fault of the Labels. Take recording for instance. If a recording studio applies overhead based on the estimated number of studio hours they think they'll incur throughout the year, the overhead cost will be more per studio hour than if the studio applied overhead based on capacity of recording hours available which is the way it should be done. Artists should only have to pay for the time, labor, and materials it takes to produce their own albums, not the studio's idle time because they can't get enough business. While this will result in underapplied overhead for the studio and an increase in cost of sales, that's not the artists' fault and it shouldn't be their problem. The Labels and the studios need to find a way to bring their actual recording hours closer to capacity to get their profit margin back rather than overcharging the artists for it which is, unfortunately, still legal in the USA. This is why an album can sell 250,000 copies and still leave an artist owing money, because they're sticking it to them by overapplying overhead.