BMI Reports All-Time Profit High Despite Piracy

applemasker writes "Arstechnica is running a story chock full of links to other interesting things about BMI's amazing record profit and how the RIAA skews its sales statistics while strangling fair use." Phew, so the artists aren't really starving, but we still can't all go back to "borrowing" music from our friends instead of each purchasing our own copy.

Comments

"Effect" bottom line?

[Colonel Cholling]

From the article:
Everyone knows that piracy can effect an artist's bottom line

Perhaps they mean affect. Unless they mean that piracy can bring an artist's bottom line into existence-- an interesting concept.

I sense the potential for confusion

[tepples]

BMI != BMG

BMG is a record label.

BMI is a performance rights organization representing songwriters and their publishers. It handles royalties for radio play of over 4 million copyrighted songs. The other major performance rights organizations are ASCAP and SESAC.

Re:I sense the potential for confusion

[starrsoft]

I think this article was presented a bit out of context. (i.e. "how the RIAA skews its sales statistics while strangling fair use.") This is after all an organization that "handles royalties for radio play". This does nothing to counteract the argument that piracy is hurting music sales. This is the profits of playing music on the radio, which would logically be greater, because of file sharing not less.

I think the problem the RIAA has with file sharing is that is shifts the profits an artist receives to being funneled through (with usual middleman skim-off) BMI type companies instead of BMG (RIAA) type companies. This article isn't and shouldn't be about RIAA type sales not decreasing; it is about the revenue, that music lovers direct to artists, shifting to other industries as a result of technological evolution.

Re:I sense the potential for confusion

[shark72]

"paying more than 85% of revenue collected to copyright owners." Copyright owners = the record company's"

I'm not sure how you made that connection. BMI is a performers' rights organization. They represent (and help collect money for) songwriters and composers, not record companies. Songwriters and composers, on the whole, make absolutely terrible money, and it's organizations like BMI that look out for them.

It's covered here.

Re:I sense the potential for confusion

[shark72]

"If you look at the typical contract, you will see that the "copyright holder" *is* the record company."

I think I see where you and the other fellow are confused. There are multiple copyrights. Copyrights on the words and music remain with the songwriter and composers and/or their publishing companies -- the folks represented by BMI, the company we're discussing. These are the folks that BMI means when they refer to "copyright holders."

The copyright on the recording often belongs with some combination of the record company, the engineer, and/or the producer. The record company typically has exclusive rights to distribute the recordings (this is how they recoup the considerable expense associated with producing and distributing the CD), which are licensed to the record company by the copyright holders.

Just to be clear, BMI represents -- and pays -- composers and songwriters... not record companies. They're different revenue streams. Record companies get their money by selling CDs. BMI collects money through public performances.

I hope this helps clear it up.

BMI is not the RIAA

[common middle name]

As far as I know BMI handles royalties for broadcast rights and things like "covers" and songwriting credits. It has nothing to do with sales of pre-recorded music which is what the RIAA claims is hurt by piracy. When you buy a cd from a major label band BMI doesn't see any money. They only benefit from the radio station you listen too playing a BMI artist's songs or the local kareoki bar patrons singing along to a recording. This has nothing to do with pre-recorded music or file sharing. Nothing to see here...move along.

Re:BMI is not the RIAA

[direktor]

The parent article is right. BMI has nothing to do with album sales. AND, contrary to the article I'm replying to, BMI does not have the leverage to promote bands. BMI is an administration company...they're like a payroll service for songwriters. Ars kinda screwed up with this one, hinging their whole article on a piece of info that's not really pertinent.

Re:BMI is not the RIAA

[shark72]

"Companies such as BMI obviously have the leverage to promote bands in such a way such that Creed, for example, sells umpteen million albums, and a band that no one's ever heard of, like Evanescence suddenly appears and sells millions more."

While BMI could do something like this, that's not their job. That's largely the job of the record company.

BMI collects royalties for performance rights and distributes them to composers, songwriters and music publishers. While they (as well as the other artist rights' society in the US, ASCAP) will tout the list of big-name artists who are BMI members, they're not in th business of promoting some of their artists over others -- they serve all of their members.

"For what it's worth, I believe companies like BMI are behind getting sub-standards like those I mentioned (and certainly many others) airplay, while many other bands who are more sophisticated, never see the light of day....or the airwaves, or whatever."

Not really. Any songwriter or composer may join BMI. They are a performers' rights organization, not a PR firm, advertising agency, or record company.

Re:BMI is not the RIAA

[black mariah]

BMI does no such thing, and has absolutely no incentive to. It doesn't matter how many albums a band sells, they still pay the same fees to BMI that everyone else does; about $300 per year.

BMI is not a record company!

[shark72]

BMI is a performance rights organization. They are not part of the money flow involved with buying a CD. They are non-profit, run by and for artists and composers -- the "good guys" according to many Slashdotters.

They handle public performances. Not CD sales..

Again: BMI = good guys. They collect money for artists and performers -- the little guys. And this money does not come from CD sales. It would be a stretch to claim that P2P would have any effect on BMI's revenue stream. It's all explained here.

This has to be the mother of all straw men, folks.

Re:What BMI will say

[erick99]

This is not new, not that it changes the argument but I was taping songs off the radio in the 60's when I was 10 years old. I would agree that it's easier now and the quality is better but copying songs is an "old" practice and I just don't know that it has the effect that the labels believe. When I got older and got a job, I began paying for my music as I believe most folks do.

Cheers,

Erick

Re:What BMI will say

[shark72]

Why would they say that? BMI collects royalties on performance rights, not CD sales. CD sales have nothing to do with their revenue stream.

Remember, BMI is a non-profit artists' rights agency, collecting royalties for composers and songwriters for performances -- not sales -- of music which was written or composed by their members.

Re:What BMI will say

[tigeba]

BMI is a non-profit organization that collects royalties for performances on behalf of artists. ASCAP is a similar organization. The money is obtained from entities like radio stations and then is distributed to artists based on statistical sampling of compiled performance data. Artists (songwriters, composers, publishers) select an organization (BMI, ASCAP) and register their works with them, and in return for a membership fee, the organization sends them a check if their performances show up on the radar.

Not for profit

[Inv8r Zim]

Just to take issue with the headline, Broadcast Music International is a non-profit entity, so saying its profits hit a record high is misleading. They collect royalties for musical artists' radio, TV and other media performances, but they do not "Profit!" from them.

My band, which had a major label deal in the nineties but imploded in a drug fueled haze over a decade ago, still see an incremental uptick in BMI checks every quarter. Go figure.

"Chock full of links"?

[TheFrood]

No, it's chock full of 404's. Here are the correct links:

open and vicious attack on fair use
bring civil cases themselves
bends its statistics

You know what BMI does, right?

[werdna]

BMI does not sell records, and its revenues do not depend upon record sales. BMI is one of three main competing performance rights associations (ASCAP and SESAC are two others), who control the exclusive right to publicly perform (as opposed to distribute and reproduce) music. Typical licensees are restaurants, night clubs and radio stations.

Presumably, even pirates eat, party and listen to the radio.

Not that I don't sympathize with your position, but BMI is in a different business from the RIAA.

An easy answer to your question

[werdna]

The artists don't make money when the BMI does. BMI represents composers, not artists.

At least two copyrights are implicated whenver you listen to a recorded song; (1) the copyrght of the musical work (noticed with a "c-in-circle"); and (2) the copyright of the phonorecord (noticed with a "p-in-circle"). The composer owns the (c), the performing artists own the (p).

BMI collects license fees from places like nightclubs for the right to publicly perform the song. That fee is divided using arcane formulae among subscribing composers. It has nothing to do with record sales.

Re:Inflation

[shark72]

No problem, that figure surprises a lot of people. The data is here (note I was a little high; it's $13.29 now, down from $13.79 last year). The reason why many folks balk at that average price is because it's a mathematical average of all new CDs sold, and I think many if not most Slashdotters don't buy the most popular music (but they might be "sharing" it ;-) ).

It's common practice nowadays for retailers to put a hot new release out at $11.99 or $12.99. During the first few weeks at that price, it will sell a metric buttload of copies, thus offsetting the relatively few copies of $17.99 CDs that are sold at the same time. Thus $13.29 is the average price, and not the typical price when you look at all the CDs on the market, unweighted by their popularity.