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Rockers Sue Sony Over Download Royalties
Ohreally_factor writes "According to an AP article, groups Cheap Trick and The Allman Brothers allege that Sony is paying them less than what they deserve for music downloaded from popular download sites such as iTunes. Because Sony counts such sales as the equivalent of a physical phonorecording sale, they deduct costs for packaging (20%) and breakage (15%) from the artists' royalties, just as they would if they were selling CDs through more traditional means. Seeing as how there is no physical packaging, nor physical inventory that might suffer breakage, one wonders how Sony will defend against these charges."
"We have altered the bargain. Pray we do not alter it any further."
Probably by counting online music sales in the way they account for MP3 downloading? To a RIAA weasel, online music in any form is indistinguishable from shoplifting, and the artists should be thankful that Sony's also not deducting costs for inventory shrinkage (100%).
Seeing as how there is no physical packaging, nor physical inventory that might suffer breakage, one wonders how Sony will defend against these charges.
It's pretty simple. Sony will simply claim that there are marketing costs, server costs, bandwidth costs, and so on that amount to the same thing. To say otherwise would be to admit that they could be selling the downloads at lower cost to the consumer than the equivalent CD.
Sony may even capitulate so far as to actually update the contracts, so that it spells out, for online sales, how much money goes to marketing, bandwidth, etc. At the end of the day, however, I highly doubt that the artist will see a larger percentage of the sales than they did before. Nor will the consumer see any kind of savings.
It's unfortunate, too, because a reasonable pricing model for online downloads of music could have been arranged where:
1. The consumer pays less per track than for the equivalent physical media (which is fair, considering compression losses and lack of a physical object).
2. The artist gets slightly more per sale than before.
3. The label gets slightly more per sale (because of savings due to lack of packaging, etc.).
However (and not too surprisingly), the labels have decided that any savings that arise should all be kept by themselves. As we are starting to see, this strategy will lead to losses instead, as both artists and consumers seek out better strategies... maybe even business models without so many middle-men.
...one wonders how Sony will defend against these charges. The same way crew managers on the Alaska pipeline defended getting paid for 25-hour days: it's in the contract! Sony should know, they wrote the contract. Until artists wise up and stop signing contracts that allow the record companies to screw them any time they please, artists are going to keep getting screwed. Granted, in this case the contract was written before any such thing as internet downloads existed, but since Sony owns the copyrights and not the bands, they are in a very poor position to renegotiate.
I've abandoned my search for truth; now I'm just looking for some useful delusions.
But it will only cover those songs sold electronically, yes?
Let's look at iTunes. $0.99 per download. One billion songs downloaded. I dunno, 33% of these are sony, or 300 million. Sony gets $.070 of each sale. $210 million. Artists claim they've been screwed out of $0.255 per sale. $76.5 million.
That is chump change to Sony.
The only people who will see any serious monrey froma settlment like this will be (like always) the class-action attorneys.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
So how is it any different that the copies are bits now? It's not like the CD breakage was any more real. Sony's response to that part of the complaint, at least, will be "It's a standard contract term, and they agreed to it."
Contracts aren't that simple. Just because you agreed to the terms in a contract doesn't make those terms enforceable.
AccountKiller
For record companies, every imaginable expense is billed to the artist. If you go on tour, ALL the expenses are billed to you including expenses like this one that are just ridiculous. The bottom line is that the record company tries to take zero risk. All the risk is moved over to the artists. You can have a hit record and end up owing the record company money.
It is sort of the same for movies where actors are paid a percentage of the profits. The idea here is to make sure there are no profits so that the actors don't have to be paid.
The fat cats make darn sure they get their share though. It's an expense after all.
The silver lining is that, unless you are one of the really big name artists, you're much better off promoting your own career on-line. Once the majority of artists realize that, the record companies are toast.
Established artists that actually have some money should get smart and start re-recording their classic songs...
Most of them don't own their classic songs. The publisher does. The artists are probably not authorized to sell the work they created. They sold their souls, and now they must deal with it. That's your copyright dollars at work.
What?
You've edited my submission, and my submission was thereby improved! This is (almost) causing me to question all my notions about slashdot and the slashdot editors! Maybe you guys really do do some work around here? =)
It's not offtopic, dumbass. It's orthogonal.
RTFC (Read the fuckin' contract) and note your signature at the bottom, guys. You agreed to this. Should've thought about that before signing yourselves away to a corporate babylonian whore like Sony.
Perhaps. But fraudulent claims in a contract are unenforcable. IANAL, but note that the contract doesn't say 15% for the possibility of breakage.
In theory, there's no difference between theory and practice. In practice, there is.
And especially since the cost of distributing the song over the internet is next to nothing anyway.
How about zero, at least to Sony, et al. In the case of the iTunes store, Apple is the one paying for the bandwidth and the store maintenance, etc. Sony is getting 70% because they suckered some 20 something into a deal 20+ years ago.
Charging for storage media and breakables. Sad thing is that it is probably in the contract they signed and there is nothing they can do about it.
A creative lawyer may well be able to make something of this. The band agreed to pay for damage and packaging. The deduction is for this exact purpose, and no other. The record company is claiming for this damage and packaging, even though there isn't any. There was no need for the record company to do so. Surely they're making fraudulent claims.
I can't help but think that, as self publishing and self publicizing becomes more doable, that there is no way that the old model of the recording megacorps can continue to hold up. It's just not sustainable.
I've been thinking about the whole packaging/transport/etc issue for a while, because iTunes throws the whole deal into a clear perspective. As far as Sony and others are concerned, it costs the same to disburse 12 songs on a CD as it does to disburse them digitally. But obviously that can't be the case, therefore online music is overpriced.
Add into that the fact that the artists still aren't getting anything like their fare share of the profits, and you get a real good insight into how crooked the business really is. All these things, how much shipping, and breaking, and band publication costs, taken as fact by the artists, and supported by the available business records of the industry...Clearly they're cooking the books, at least in terms of online sales, and if there, then why not other places?
I don't see the RIAA lasting. I just don't see how they could. They can't monopolize distribution. Social networking sites make it very easy to self-publicize things like music. Convert venues can decide for themselves if the bands are worth hosting. What else is there? The CD market is on the way out, that's just inevitable. It's a dead-end format and they restrict it more all the time.
People always talk about the buggy whip manufacturers, but the difference is, some people felt bad when the buggy whip manufacturers went out of business.
ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
Of course theres the common reasons of marketing, distribution etc...
BUT the big reason is the recording companies are the gateway to popularity since they own or are in bed with the major radio stations and MTV/VH1. They control what gets airtime and therefore what is popular. Sure you can have some success as an independant but rarely the instant popularity you can achieve through the recording companies.
I think the downfall of the recording companies will come from services that use aggragated peer reviews (ala digg) and recommendation engines (ala pandora.com) to provide listeners with a broader collection of music catered to thier personal tastes. When "popular" is derived from the people, instead of the companies' required playlists, the companies will no longer have the bargaining power to enforce prices or horrible contracts
How many of the current artists write their own songs?
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The RIAA and their cohorts write the laws and pay the legislators to pass them. The People, whom the government is supposed to serve, no longer has any representation.
So by now, I would expect any such laws to have no teeth.
Use 'slashdot stuff' in the subject line in any email you send me if you want to get past the spam filter.
You beat me to pointing that out. :(
The other thing I'd nention is this:
Because the contract covers defined methods of distribution, and online distribution is not allowed by the license from the copyright holders, this means that the labels themselves are guilty of copyright infringement, and are doing so willfully, for profit, and by levying fees against the artists and mailing checks which are baased on the fraudulent fees, they are adding mail fraud on top of the simple copyright infringement (of which there would be 1.000,000,000 individual counts if files). This is a felony actiity, and obviously piracy (if we accept the new term piracy).
This is obviously not within fair use (simple trading of mix tapes for free, which is essentially what is done on P2P networks) but criminal activity, and as we all know, piracy funds terr'rists. Therefore, homeland security and the NSA should be closely scrutinizing the big labels (and their subsidiary "Indie (but not so Independent" labels) for terr'rist funding.
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
"Apple is making the Record Labels obsolete."
The iTMS has been a huge success and, whether we like it or not, the record companies are laughing all the way to the bank.
"They didn't produce anything."
Are you sure about? A piece of paper with some song lyrics is not the same as a completed recording that's been engineered, mastered, produced, and promoted.
"...and music publicity should be free (radio/touring)."
I have a pretty good voice and a sheet of paper here with some pretty good lyrics. I would like to get it recorded and produced, and then into heavy rotation on radio stations nationwide. I would also like to start a multi-state tour. I would like to get this all done, as you've put it, for free. Can you give me some suggestions for doing this without outside assistance?
"They just aren't needed any more."
That's great news. Have you considered going into business in helping artists do all of this without a record company? I presume you'd want to work for free, though. It wouldn't be fair for you to take a cut of sales in exchange for your expert assistance, because then you'd be just as bad as the record companies.
Sitting in my day care, the art is decopainted.