Slashdot Mirror
Record Labels Looking for a Cut of Tour Revenues
Anonymous Coward writes "As many a Slashdotter has pointed out, musicians make their money not from selling records but from going on tour. Now record labels are trying to get a piece of the action. 'Now the music labels, hungry for revenue from any source, are mulling over whether to make a grab for a piece of the tour biz. One company already has: In October EMI Recorded Music signed a deal with Brit singer Robbie Williams that gives the label a cut of the pop star's merchandise, publishing, touring revenue and sponsorship.'"
I'm surprised it took them this long. I mean come on, there's a way for them to bilk the artist out of more of their earnings, and they didn't do it? That's not the recording industry I know!
I thought a big part of the RIAA's argument is that the labels have to underwrite the promotion and some of the costs for the tours... If this is true, then shouldn't they have already been taking a cut from the tour profits? Maybe I'm wrong here. I'd check out the RIAA's site, but it appears to be down...
Ok, to the animals who don't get the "theft" thing, a concert has real scarcity. If I copy your ticket, both our asses can't sit down in that seat. A recording has only artificial scarcity. Copying your cd has no effect on you. So this is a good thing. Let them act as promoters.
-Libertarian secular transhumanist
Anything they can pass of as "promotions" is charged to the artists' potentional royalty payments. Oddly enough, this usually eats up ALL royalties due.
The artists should start counting every single expense of a tour as promoting the album and demand credit for it.
-- Will program for bandwidth
If you're willing to sign away your profits in the future for that fat advance now, the only one to blame is you. On the other hand, maybe the only way to get anyone to listen to your crappy music is to get a major label to spend millions promoting it, in which case giving a percentage of the tour revenues you wouldn't be making without selling your soul to the record company is a good deal anyway.
Remember, we don't have Britteny Spears because she is a musician. We have Brittany Spears because a record company invested millions of dollars in creating her. It's only fair that they get a cut of the tour revenues she never would have had at all without their promotion.
In modern society, there is no reason to make a deal with the devil for fame and fortune - just call up EMI.
paintball
These days, with very few exceptions, the biggest stars are all manufactured by the record labels anyway. The labels engineered many of these pop , or perhaps 'puppet', sensations that so many people go 'ga-ga' over.
Perhaps the better question is: why have some of these engineered musical groups earned so much, when their popularity and following is almost entirely due to the label's efforts?
"But, why me?"
"Because you fit the suit."
-The Brady Bunch, "Johnny Bravo"
People, the answer is simple! VOTE WITH YOUR DOLLAR! CD-Baby.com has a load of GOOD music, and not a dime of your money goes to the RIAA.
This is the ONLY way that the RIAA will understand that we're not going to take their shit anymore.
--
http://nemilar.net - Not your grandmother's soup kitchen
I believe you'll find that this is the norm for all of the "manufactured bands" and "pop idols" that the industry created from scratch. Only the real artists get their own touring revenues, and the writing has been on the wall for them since the labels discovered that they could manufacture bands in just about any popular genre, not just bubblegum.
Personally, I think it's a good thing.
One of the reasons that artists are skeptical of online distribution of their music is the fact that it has the precise effect of making record lables think of those songs as valueless (which they are) and instead focus on tangible things that people will pay for (e.g. a concert with merchandise).
Once artists and labels get used to this arrangement, though, there's no reason that the indy labels can't do the same, and then distributing the music cheap (or even for free) and making their money on the concerts too.
A "label" in the Internet age should be... what? My feeling is that it should be a clearinghouse... a packager if you will that records/collects the band's or artist's music, sees to its quality of recording, adds lots of indexable info and then gets it to all of the online distributors (iStore, mp3.com, etc) that will "retail it". Heck, they could just run a Gnutella farm with a web-site full of reviews and other "value added" indexing, and a client-side plugin for downloading. Boom, instant high-bandwidth music distribution, and as long as the client has some basic incremental checksum system so that it can verify it's getting the exact file that you selected, you can be sure you're downloading what you wanted. That adds ad revenue to the label's list of sources.
The margins on all of that are small to negative, but if they have an alternate source of income, then they can afford to do it, and there's really no reason that foobar label can't compete with EMI on equal footing.
And you wondered why the RIAA was deathly afraid of file sharing... it's not because they thought their members would lose money, but because they KNEW that it had to lead to a decision about the value of music that they didn't want to have to make, and ultimately killing this goose once and for all!
Well, labels, who claim to promote and thus 'make' and artist, are simply greedy for more action.
Regarding Williams (a "pop star" I have no time for) EMI are taking a cut of his tours, merchandising etc but they've paid him, or are contracted to pay him, several millions of pounds over the next few years. When the deal was announced, Williams said, "I'm rich beyond my wildest dreams!"
He'd better not speak so quickly. Mariah Carey was rich too, until Sony dropped her.
Interestingly, Williams takes the attitude that Filesharing is a Good Thing. He actively encourages his fans to download his music.
An attitude shared by Snoop Dogg, Chuck D and Courtney Love. Shame Britney Spears doesn't know what time it is yet...
There was just now a segment on ABC World News about The [Grateful] Dead's new model for making money off music. They record their shows every night, take orders from fans at the show, have their audio man master it, ship it off for duplication on CDs, and have it in the mail to the fan within about three days.
Instead of the $1/album typically made by signed bands they make $8-$10 on the three-CD set that sells for $22. They've turned a quarter of a million dollars on the CDs from their performances at Red Rocks over the past couple of weeks.
Not mentioned at the link, but Peter Jennings added that the music companies don't like being cut out of the loop like that.
Sheesh, evil *and* a jerk. -- Jade
As much as I'd love to belive that I don;t think that will happen.
Stan Lee made this mistake for Spider man, most ppl know to ask for a percentage of the revenue flow not profits.
But it would be soooo nice to see record companies blunder
My understanding is that what the labels often tend to do is sign a 'quick' pre-contract agreement that pretty much locks up the musicians, then starve them into signing.
Quick, nasty and effective. The trick for the musician is to actually pay attention before signing such 'quick and harmless' agreement in principles -- but the young and eager are often blinded by apparent opportunity.
Free Software: Like love, it grows best when given away.
"The concert business has never been bigger, in dissonant contrast to the recorded-music business. While music sales have dropped for three years in a row, from $13 billion to $11.5 billion in 2002, hurt by Napster-style digital piracy and a lackluster flow of hot new acts, the tour business has climbed for four years straight, from $1.3 billion in 1998 to $2.1 billion last year."
/.ers claim, and not because of Kazaa, etc., then why have concert revenues been increasing over the last few years? The answer, cd sales are not down because of the bad economy, because then we'd see at least some correlation between concert sales and cd sales trends.
So, if cd sales are dropping because of the bad economy, as
Vote for Pedro
Don't the labels get a fee whenever a song is performed? (Some of which might be back to the writer, if the label feels like it...) Wouldn't that include the artist performing their own song?
Royalties are supposed to be paid when a song is performed. That royalty goes to whoever owns the copyright, which would be the artist if they were smart, or someone else if they voluntarily sold the rights to the song. It wouldn't include the artist performing their own song if they own the copyright.
I guess the new part is wanting a percentage of merchansing? Oh, and the article says sponsorship, too. Ouch. You mean you can't even sell out to Pepsi without losing a cut, now?
This comment makes it sound as if the labels are taking a cut without doing any work, like perhaps mafia protection money. Deals such as these are not extortion, but the record companies branching out into other areas of the entertainment business that have existed for years - merchandising; someone must make, market and sell the stuff - sponsorship; someone must produce the numbers and charts, seek out potential sponsors and sell the artist to them as a good marketing investment. This takes time, people and money.
Right now these things are going on (whoever got Led Zepp their $500,000 fee from Cadillac took a cut), record labels just want to enter that part of the biz. If the artist thought someone else could do these things better, they are free to work with them. I could see big labels being in a good position to excel in these areas as they have lotsa cash to work with and plenty of contacts.
Please notice that this article only discusses mega-huge acts. It could be a sound business move for a major artist and label to enter into all-encompassing contracts which cover recording, merchandising and touring, instead of bouncing back and forth between several companies. This type of deal probably wouldn't be effective with or for smaller acts.
RTFM; please, I beg you.
Think about it, Robbie Williams is raking in the cash here on everything to touring, merchandising etc. I can understand the record company wanting a chunk of the merchandising revenue particularly because I believe they basically "own" the Robbie Williams trademark - However this is not an example of companies wanting tour revenue.
Lots of slashdotters here, the ones who don't know what they are talking about and clearly have never strayed past POPular music think this is fine, because they see Eminem and Dr Dre ($50 Million US this year!) and guys/girls like this living it up. What they don't understand is that the bands that have popular followings but are not on MTV perpetually through the day are the ones that are going to cop the worst part of this. Most of these types of bands have far better music aswell.. Irony eh.
In summary I don't know that this article is really suggesting the right thing, Robbie Williams is probably an exceptional case here. It really would be the finally kick in the teeth if they did this to starving artists.
The artists already give a cut to someone, and it's called the promoter. Currently, the big boy in the business is Clear Channel. http://cc.com/
Currently, the way it works is that you have to schedule tours through Clear Channel for the most part. There are some local organizations who will properly get promotion and venue arrangements in place, but even then they have to usually give a cut to Clear Channel for the rights to promote someone. Anyone who's worked in a campus concert promtion board knows that you mostly have to pay off Clear Channel before an artist will schedule a date on their tour in your city. For big artists Clear Channel may get $100k up front, smaller ones maybe as little as a few thousand, but they get paid before a single ticket is sold. The venue then takes their cut of the gate, extracts the costs from the leftover and then gives the rest to the artist, and in some cases a cut of that goes to Clear Channel again, depending on how it was negotiated. Merchandise is usually only split with the venue, but it wouldn't surprise me to see some of it go to Clear Channel also.
There used to be a rate card published for clear channel's upfront fees for an artist, but I can't find it anymore and it may not have been a public site. It is very interesting to see how much it would cost a venue promoter to book an artist, as some of them make quite a lot of money just for showing up.
If anything, I'd see Clear Channel getting pissed before the artists, because at the very least this would give artists an option of who to let them promote their tour in the future. Clear Channel or their record label directly, either way the artist is going to drop at least %20 of whatever the gate is, so you can deal with the devil you know, or....
...and all I got was this lousy t-shirt!
No seriously, I did help create a contract management system for EMI in the early 90's. Biggest piece of shit I ever worked on. No access to the subject matter experts (people who know what it should do), but plenty of "interpretation" from middle management types.
It was made clear to us that the only purpose of record label contracts was to fuck the talent and maximize label profits. Advances on publicity costs for tours to promote the album, holdbacks on royalties until the label had turned a profit, "equalization" so that profits from one album were siphoned off to pay "expenses" incurred for others.
On the other hand, there were stories about how the artists would occasionally score a victory. I think it was Dean Martin, beholden to his label for seven more albums, who showed up, dropped seven albums worth of shit tracks on the desk, and said "Ciao!"
And Christ, don't get me started about the VP who would grab us at the end of the workday and shanghai us to Flash Dancers (Manhattan tittie bar) to force us to charge hundreds on our credit cards which we billed as meal expenses.
Yuck, it's not just the talent who feel like we swam a river of shit for the music industry.
No one tell the RIAA but the real money is in scalping tickets for insane prices on Ebay. There are people making a good amount of money by buying tickets as early as possible on web and turning around to get a premium after tickets are sold out.
I should know I just bought 2 tickets to see a Radiohead concert for $200 bucks on Ebay.
Where the Music Matters
..for a college level paper, you should receive a C at most.
Anyway, to the flaws:
1. None of your quotes are cited properly (if at all). A rigorous marker (like myself) would return the paper at this point with a note along the lines of "Don't pull this stuff from your ass, show me where" though I'd probably phrase it more politely than that on the actual paper.
2. You haven't actually disproved the notion that file-sharing is the cause of lowered sales. You've provided a number of alternative explanations, all quite reasonable, but shown no evidence that any of your alternatives have any greater correlation to the sales drop than the record industries assertion of file-sharing.
3. You give no proof of the assertion that "the current downward trend in record sales would have to continue for 10 years for a loss of 4 billion dollars to occur." Nowhere in the paper have you stated a dollar amount of what the record industry actually lost. The only amount is the 4 billion they state which you dispute on the basis that you, personally, could not find corroborative evidence, in your vast research which encompassed.. let's see here.. eight citations all from the web. Bibliophobe, perhaps? Still, this is an English paper, so maybe we can let that slide.
4. Your blanket assertion that the DMCA is unconstitutional is on shaky grounds at best. If Lessig's argument that retroactive extensions applied directly to copyright are unconstitutional was not accepted, how will a law that says nothing about copyright terms at all likely be seen? If anything, this is more open, because there is nothing in the law that says companies cannot release some sort of "master key" that works once copyright is expired - and until they fail to do this once the copyright is expired, we can't say that the DMCA has prevented "limited times" from being expressed.
5. Again, you assert something about the record industry (namely the terms of their contracts) without providing any type of citation as to where exactly you drew the material from.
6. Don't piss around with numbers. If you're going to try and use numbers to back up your argument, you better be comparing apples to apples. So comparing a record contract that has various costs applied to it to a bar gig without also noting the various hidden costs there (transportation, accomodation, road-managers, merchandise costs, etc) is not exactly fair. Now, I'll readily admit that bands probably do make more, but by missing the details, you haven't shown it.
That's some of the basic flaws with specifics.
Looking at the whole thesis, the question immediately arises: What is the unjust law you are drawing attention to by your actions? Which law, specifically, does your downloading music protest? Have you informed those who might punish you for breaking the law that you are doing so, because if you haven't, it strikes that you are not willing to go by the words of MLK and accept the punishment. In fact, MLK was quite specific about that, it's not the act of breaking the law that's the protest, it's suffering the enforcement of it to draw attention to the injustice of the law.
Until you do that, you're not some moral crusader, so stop pretending. Leave the moral crusades for those, like MLK Jr, who had the guts to go through with it.
That Jesus Christ guy is getting some terrible lag... it took him 3 days to respawn! -NJ CoolBreeze
With a friendly voice
A companion, unobtrusive
Plays that song that's so elusive
And the magic music makes your morning mood
Off on your way
Hit the open road
There is magic at your fingers
For the Spirit ever lingers
Undemanding contact
In your happy solitude
Invisible airwaves
Crackle with life
Bright antennae bristle
With the energy
Emotional feedback
On a timeless wavelength
Bearing a gift beyond price ---
Almost free...
All this machinery
Making modern music
Can still be open-hearted
Not so coldly charted
It's really just a question
Of your honesty
One likes to believe
In the freedom of music
But glittering prizes
And endless compromises
Shatter the illusion
Of integrity
"For the words of the profits
Are written on the studio wall,
Concert hall ---
Echoes with the sounds...
Of salesmen."
***
Radio Shack. You've got questions...we've got blank stares(TM).
Tipjars violate the "exclusive distribution" part. It would be pretty easy to show that "tipjars" are designed, form the start, to provide recompense to artists for otherwise illegal MP3 downloads, which means that "tipjar" is violating the record company's exclusive license to US (and, likely, euro) distribution.