EMI May Cut Funding To RIAA, IFPI

Teen Bainwolf notes a report that Big Four record label EMI, which is under new ownership, is considering a big cut in its funding for the IFPI and RIAA. Each of the labels reportedly contributed over $132 million per year to fund industry trade groups, and EMI apparently believes that money could be better spent elsewhere. "One of the chief activities of the RIAA is coordinating the Big Four labels' legal campaign, and those thousands of lawsuits have done nothing but generate ill will from record fans, while costing the labels millions of dollars and doing little (if anything) to actually reduce the amount of file-sharing going on."

Comments

Tag this

[Mike89]

Tag this 'commonsense'. Finally a record label who is starting to 'get it'.

Re:Tag this

[Anonymous Coward]

Yeah, but the moment of truth will be when more effective TPCA / Vistaids backed DRM becomes feasible to widely deploy ... will they use it and shit all over consumer's fair use rights again? I suspect they will. They're waking up to the fact that their current tactics are counter-productive, not necessarily to the general idea that their consumers should be treated fairly.

Re:Tag this

[CastrTroy]

Finally a BIG NAME record label who is starting to 'get it'.

There, fixed that for you. There's lots of smaller labels who have "got it" all along, but they're just smaller ones, and you don't hear their music on the radio, or on the TV. There's plenty of good music on the smaller labels, and if people actually had any convictions, the RIAA would have gone bust many years ago, and their member companies wouldn't have been able to sell any music. The point is that most people don't know or don't care about the RIAA tactics. My biggest question is what happens to EMI now if they do this? Will they still be able to get as much radio play their music on a regular basis? Will their bands still get invited on the talk shows? How far does the power of the RIAA really extend?

Re:Tag this

[Calinous]

RIAA is a puppet, paid by the big music companies. It doesn't have much power, and no power over what their masters allow it.
      RIAA's power will decrease after this.

      How about radio play, talk shows? I think it will be business as usual - if the other big music corporations will ignore this. If they will lobby the radio stations, it might be possible that EMI loses some air time.

Re:Tag this

[cbreaker]

I have to disagree that "most people don't know or don't care about the RIAA tactics." Everyone seems to know about kids getting sued, and everyone is pretty annoyed by the whole thing.

Try to think of one person you know that isn't aware of the RIAA's lawsuit campaign. Then ask them, and you'll probably be surprised.

Re:Tag this

[CastrTroy]

The point I was making was that they don't have any convictions. They may know about it, and say they care, and say they think it's terrible, but they keep on buying the music. That's very hypocritical. If you have such a big problem, stop buying the music. If you're still buying their music, you obviously don't care that much about their tactics.

Re:Tag this

[dgr73]

Exactly what he said :) Plus the fact that it's slowly but surely becoming an "in" thing to be seen to be on the consumer's side. Why fight a fight you can't win and ruin your reputation in the process. Why not make a big hoopla about cutting funding to RIAA and then cut it by 10%, which is invested into other counterpiracy measures. Not only will your company look good (compared to the other 3 major labels), but they may actually see slightly improved results.

Or it could be that the music industry is turning altruistic in it's old age and they wish to slash their profit margins by condoning free downloads. The next move in this vein will undoubtedly be a repeal of the "work for hire" clauses in all contracts, as well as a large hike in royalties.

Re:Tag this

[FredDC]

The problem is that the RIAA would attribute the decrease in sales to piracy, not to the fact that people stop buying the music because they are against the RIAA's tactics.

I haven't bought any of the big labels' music in a long time, nor have I downloaded it. The rare occasion that I listen to the radio (usually in someone else's car), I realize I haven't missed much...

I wonder how much percentage of the drop in record sales is due to people who simply stop listening to the music these record companies produce. The RIAA is always shouting that it's because of piracy, but how much is due to other reasons? I doubt they've done any research about that.

Re:Tag this

[DannyO152]

Promotional bookings. No change. Not one dollar to RIAA goes to artist development and support. Bookings relate to popularity, availability, and when all things are equal, if the program is a booking agency's package, then musical artists represented by that agency move to the front of the line.

Radio is a more complex question. Do the radio stations believe that digital music increases or decreases their listenership? How much radio programming is actually based on the artists the big labels sell? While the radio stations leverage the fact that they can make songs hits and there are more good records than airplay slots, they are constrained by having to do some amount of giving the listeners what they want. As they are also promoting local concerts (well, ClearChannel is), they can't afford to base every decision on back room deals and accommodations. I guess it comes down to how they felt the record companies suing grandmas helps or hinders their business and how significantly. I tend to believe radio will sit out this one: it's really hard for me to expect that the other record companies could make a compelling case as to why a radio station should stop playing Beatles music.

Re:Tag this

[BoomerSooner]

Yes and no. Can you imagine how many bands they could sign and promote for 132 Million a fucking year? NO wonder these morons are losing their asses. If you cannot bring shit to market better than Brittany why would anyone buy your music?

Congrats to EMI for waking up, but it's too little too late. Their business model is dead.

Re:Tag this

[sm62704]

Or it could be that the music industry is turning altruistic in it's old age and they wish to slash their profit margins by condoning free downloads.

Advertising isn't altruistic. Giving out free samples isn't altruistic. These dumbasses need to realise that they are RECORD companies and start selling RECORDS again - physical media with full fidelity music on them. Give away the MP3s.

Of course, this will be the death knell of losers who put out a CD's worth of crap that has one decent single they play on the radio. But with some bands it's the opposite. By the time Aerosmith came out, I'd given up buying an album on the strength of a song on the radio, and I REALLY was unimpressed with the minor key whiney Aerosmith song they played on the radio, Dream On. It turned out that that was the only sucky song on the album! But if you had liked that song, you likely wouldn't have liked the rest of the album. I bought it after I heard the LP at a friend's house.

It it was today, and the songs were posted in the internet, I'd have bought it right away.

I always liked Santanna, and when Supernatural came out they weren't playing any of it on the radio here. So I went to CD NOW and listened to the 30 second clips of its songs, and was incredibly unimpressed. "When did they start sucking?" I asked.

Well, my daughter didn't know this but knew I liked Santanna, and bought tha CD for me for Christmas. It was a great CD! Had she not bought it, they would have lost a sale. But had she not bought it and they had posted full MP3s on the internet, I would have bought it.

Advertisers will tell you "sell the sizzle, not the steak". If brains were dynamite, record company execs wouldn't have enough to blow their noses. If they had any brains they would post MP3s and make sure everyone believed in MP3's inferiority to CDs.

That said, the RIAA labels have pissed me off to the point where I only buy indie; the last dozen CDs I've bought have been from bar bands.

-mcgrew

Re:Tag this

[sm62704]

The RIAA is always shouting that it's because of piracy, but how much is due to other reasons?

Actually, piracy is one of the biiggest reasons I stopped buying RIAA music - I'm boycotting the majors because of their suits against their "pirate" customers. Of course, since I don't like much of what's on the radio these days either that nmakes boycotting that much easier. I've found that the local bands and their CDs are hgeads and shoulders above the RIAA dreck, while 1/4 to 1/2 the price.

The indies are the "pirates" who are eating away at "their" profits.

-mcgrew

Re:Tag this

[CastrTroy]

But that's because they only have a limited amount of money, and many other things to spend it on. Going to the movies now costs $12. More if you want to buy snacks. Most teenagers want a cellphone. That costs money. They spend money on video games, movies on DVD, designer clothes, and many other things. The reason kids don't spend money on music anymore, is because they have so many other things that they would rather spend their money on.

Re:Tag this

[MightyYar]

You don't think that "because they can get it for free" has anything to do with it? When I was a teeny-bopper, a CD cost $11 or so, but I only made $3.65/hour. I, too, had to choose between the latest Paula Abdul album or two $6 movie tickets. The difference was that it wasn't so easy to get a free album, and the CD single cost about half of what the full CD did. Sure, I had some Beastie Boys albums on tape from a friend's CDs, but I didn't have anything like Kazaa available. Even iTunes would have been a game changer... how many of those crappy 1-hit CDs did I buy when I could have just spent 99 cents or so for the one or two hit songs on the album?

I don't buy your argument, I guess. We had video games (Atari, Nintendo, Sega, TurboGrafix), we had movies (on VHS), we had designer clothes, snacks... the only thing that we didn't have on your list is cell phones!

Re:Tag this

[Lunarsight]

I will contemplate no longer boycotting EMI releases, provided they do cut RIAA funding. Emphasis on -contemplate-.

I like that EMI finally has 1) admitted that the lawsuits were a bad idea and 2) are actually planning to do something about it.

I do feel EMI should go a step further, though - and cut ties to the RIAA outright. If they were to form a separate legal group to represent their interests, it would really drive the point home that they've learned their lesson. Right now, I still suspect what they're saying is merely rhetoric intended to repair their tarnished image.

Re:Tag this

[sm62704]

"Nice" has nothing to do with it either. People consider strings of bits to be worthless. A physical object has value. Only the stingiest (or poorest) act as you say.

I pity people with that attitude. Most people really ARE honest, at least with people who are honest with them. But if you make them think you're trying to get one over on them, look out! That's the biggest problem the record industry faces - they're thievs and scoundrels who think that everyone else is a thief and scoundrel.

Change

[Jonny_eh]

All that's needed for change is for the old generation to die out.

Re:Change

[SamP2]

That's the same thing the hippies said back in the 60s. Now that they're the ones with the reigns in their hands and what has changed?

Them.

Deceptive Summary

[pete-classic]

The summary makes it look like the blockquote is someone from EMI, when in reality it is editorializing by some dude at Ars.

-Peter

Re:Deceptive Summary

[chipasd]

That's absolutely correct. The only real news is in the Reuters article which quotes an anonymous source at EMI as saying they are "looking" into cutting back funding to "trade groups". The rest of it is rampant speculation by Ars along with a ton of self links to similarly speculative articles. The celebrations need to wait for official statements confirming that this is related in any way to the RIAA.

Bailling out?

[joaommp]

"Let's get away before we begin making fools of ourselves."

Too late.

"reportedly considering"

[$RANDOMLUSER]

Nothing to see here, move along.

Re:"reportedly considering"

[leonbev]

I'm not sure why this was tagged funny, since it's true.

"Considering" cutting RIAA funding is nothing more than a slick PR move. Until they actually reduce their contributions, they're just as guilty as any of the other big players in the music biz.

just give it time

[walshy007]

In other words, it's causing too much bad public relations AND not working, require new methods to screw the consumer with having them actually enjoy it this time. after they come up with something new, business as usual.

Re:one down, three to go!

[east coast]

It's hard to argue with EMI's logic there

Considering that EMI never said what was in the blurb and it was a blatant misrepresentation?

perhaps DRM will go the way of prohibition

The thing is that prohibition really didn't go away and the war on drugs is the remnants of prohibition. You were conned into thinking that we won some great victory when, in fact, we merely gained back the "right" to what they could tax.

Re:one down, three to go!

[Billosaur]

Actually, I don't think that's a bad analogy. Making liquor illegal only drove liquor production and distribution underground, brought about the rise of organized crime (remember Al Capone?), and probably increased the amount of alcoholism prevalent at the time. Face it -- if the liquor supply is limited, and you know where to get it, you're going to try and get as much of it as you can. Same thing is happening to music -- making file sharing and ripping illegal is simply driving the illegal file sharing economy, and it's costing the music industry far more money to try and stamp it out than it would be to embrace it and try to work with buyers.

"considering"

[torkus]

Considering does not mean they're actuallg going to do it.

You know "Mr. Overpaid Exec #1" at RIAA will call "Mr. Way-Overpaid Exec #2" at EMI and say something like 'Hey Bill, we'll try to fuck you guys up a little less next year. Promise. Besides, I my kid's going to for her degree in basket weaving and I need to make sure I get my raise to pay for that and the new ferrari'

So instead EMI coughs up extra cash this year for the MAFIAA to "change tactics" whereby they sue...everyone!

Okay, time to 'fess up...

[Anonymous Coward]

...who of you replaced the key decision makers at EMI with androids under your control? Come on, out with it!

Re:Okay, time to 'fess up...

[jamstar7]

...who of you replaced the key decision makers at EMI with androids under your control? Come on, out with it!

Damned straight, we owe that guy many many MANY beers.

Amazing

[sircastor]

Somebody actually gets it... I'm very pleased to see that a record label recognizes this and acknowledges it publicly. It shows they're not all buffoons.

Don't start patting ourselves on the back yet.

[Steauengeglase]

I don't see the RIAA keeling over any time soon, instead I imagine it shrivel up into something like one of those debt collection agencies out of Buffalo NY. It will act as a "free agent" for (mostly fake or bought out) music publishers and survive on constant lawsuits on those who will be only more than happy to pay $800 to keep from getting sued for $15K.

Never underestimate the tenacity of unemployed lawyers.

Nobody ever won a war w/ their customers

[Presto Vivace]

Commonsense is exactly right. Maybe the RIAA will get a clue.

Re:one down, three to go!

[okvol]

The analogy goes much deeper. Prohibition also encouraged home-brew. The only federal agency at the time that had the manpower was the Internal Revenue Service, ergo the phrase Danged Revenuers, and charges of not paying federal tax were brought against moonshiners. Now, even if you make your music at home and sell it yourself, an agency of the RIAA has the right to collect royalties on your behalf, empowered by the federal government. If that agency can't find you, they get to keep the money. You can't find many moonshiners today. The media has changed. Marijuana is easier to grow.

It's not common sense, it's lack of money

[Thanshin]

Guy Hands aims to snuff out excesses that cost EMI £100m a year

Guy Hands, chairman of EMI, has told potential investors the group's former management squandered around 100 million pounds on corporate excesses. Terra Firma, Hands' private equity firm, is expected to make major changes to senior management and transform the culture of a company considered to be stuck in the glory days of the music business. Industry observers say Hands will try to blame previous management for the firm's woes because he has paid over the odds for a business struggling to cope with a dwindling market.

http://business.timesonline.co.uk/tol/business/industry_sectors/media/article2963629.ece
http://dealbook.blogs.nytimes.com/2007/11/27/in-winning-emi-is-guy-hands-losing-out-on-other-deals/
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/10/08/cnemi108.xml

Actually I think EMI may have gotten it!

[RaigetheFury]

Wasn't EMI the one who started letting Itunes sell NON-DRM versions of their music selection? Maybe they're trying to be the front runner and testing the waters. Maybe they have someone who is able to explain to the big guys just how fruitless it is to try and stop illegal file sharing. Do your part in reminding people it's illegal, but don't go the path the RIAA has.

I also think EMI has realized that they no longer need the RIAA because of the power of the internet. It's good business to rid yourself of a marketing company who does nothing but put your company in the bad light. Publicly decry them, and embrace the way people want things.

Right now that is GOLD. People are starting to look for Non-DRM (and I mean the average consumer, not you and me). The average person buying their music is buying it for an Ipod and noticing how much of a pain in the ass it is to rip it just to get it on there.

Maybe EMI, is realizing that the people who are stealing weren't going to buy it anyway and that there's a tremendous opportunity for the first major record label who steps forward and waves off DRM laden music. Cost of doing business in the digital world is that people will always steal your product. Microsoft learned this by trying to lockdown windows and that failed. People just manually downloaded the patches around the "automatic update".

The problems their "DRM" did by checking new installs of windows if you reformatted and had to deal with the hassle of speaking to an indian who couldn't speak english... you get the idea... it just wasn't worth it financially. It hurt them.

Maybe they realize that the power is no longer in their hands once they release a product. Perhaps they realize it's better to encourage people to buy it, who WANT their music.

If I was a record label I'd offer the music in several different formats. Typically CD quality download, mp3 (slightly cheaper), HD (for the audio connoisseur, and then on physical media still. Some people love their physical media.

That's what people want. Make it available like that, without some DRM scheme. You'll win in the end because the people who are stealing your product, weren't going to buy it in the first place. You need to target the people who are willing. Because... you know? The people who are stealing it... will always find a way. It only takes 1 copy to hit the internet... and you can't stop that from happening, no matter what you do.

I know there were a few lawsuits but this?

[guruevi]

According to the article:
including the close to 30,000 file-sharing lawsuits filed by the record labels in the US alone.

I mean, this is way worse than what I thought it was. I thought it was a handful, you know the ones you hear about in the news. But 30,000 means a lot and a whole lot of work for the legal system (this means that 1 in every 500 lawsuits in the US or 0,2% comes directly from the RIAA). This could be used for other cases we are already overloaded with like drugs, robberies, fraud (identity theft for example), money laundering and other crimes that affect more people than a few copied cd's.

I'm considering buying an AirBus A380

[cbreaker]

And I'm also thinking of buying a Castle in Scotland, a Ferrari Enzo, and a gold plated swimming pool.

Doesn't mean I can or will do any of it, though.

They "may" cut funding?

[IGnatius T Foobar]

They "may" cut funding? Let me know when they *DO* cut funding. Until then, this should be dismissed as PR theater. Perhaps EMI wants to manipulate the RIAA in some way ... maybe reduce their share of the funding, or gain more power within the organization, or something.

So far it's just talk. And talk is cheap.

I must of lost track of time....

[AlphaLop]

Is it April 1st already???

Re:Ethically responding to RIAA companies.

[Stormwatch]

Personally, I'd like to see the Radiohead model become widespread as more and more bands opt out of the current RIAA company business model.

I know two other nice ones. Saul Williams' The Inevitable Rise and Liberation of NiggyTardust! (rap/industrial) and Phenom's Unbound (prog rock).

Re:one down, three to go!

[gweihir]

Maybe if these substances were free of their black market status they'd lose their allure.

They still can be used to make a decent living, but it will be ordinary commerce because of much reduced profit margins. No shooting or gangs involved. But I guess this "war on drugs" is basically a PR thing, just as the "war on terror". Both do increase the problem while pretending to decrease it.

Agree:Talk is cheap, EMI!

[KWTm]

They "may" cut funding? Let me know when they *DO* cut funding.

Exactly! This reminds me of a joke, apparently about a maintenance repair request form filled out by an Air Force pilot. These forms have a spaces under the headings "Request" (filled out by the pilot) and "Action Taken" (filled out by the mechanic). This particular one reads:

REQUEST: Left tire on landing gear almost needs replacement.

ACTION TAKEN: Left tire on landing gear almost replaced.

Wake me up when EMI actually does something.

Re:Not bad guys

[scubamage]

I understand your point, however spelling it out that way will get you nowhere in a court, or board room. The sooner you stop treating them like they're evil, the more responsive they're going to be to your ideas. I agree with you completely, but you have to put things in a business context. They didn't go to war with their customers in their eyes, they used their legal right to sue people who they believed were violating their rights. Their rights are violated, so they sued. Because of it, consumer rights are getting violated. This is making their customers even less likely to buy their music. Its a bad situation for everyone. So, how do we improve things? Compromise. They get a harsh reminder that they can't survive without us, and evolve to take advantage of new business models which will spur them out ahead of their competition. We get to enjoy our media on different platforms (like EMI's drm free music). Everyone wins. They just have to be willing to accept their business model is outdated, and going to cost them their shirts if they don't evolve.