Warner Music Pulls Videos Off YouTube

iammani writes with this excerpt from Reuters: "Warner Music Group ordered YouTube on Saturday to remove all music videos by its artists from the popular online video-sharing site after contract negotiations broke down. ... The talks fell apart early on Saturday because Warner wants a bigger share of the huge revenue potential of YouTube's massive visitor traffic. There were no reports on what Warner was seeking. 'We simply cannot accept terms that fail to appropriately and fairly compensate recording artists, songwriters, labels and publishers for the value they provide,' Warner said in a statement." Warner's deal with YouTube to make those videos available came just prior to YouTube's acquisition by Google.

Comments

Re: fairly compensate recording artists, songwrite

[Original Replica]

It's been said here before, but Courtney Love explains "artist compensation" best:

This story is about a bidding-war band that gets a huge deal with a 20 percent royalty rate and a million-dollar advance. (No bidding-war band ever got a 20 percent royalty, but whatever.) This is my "funny" math based on some reality and I just want to qualify it by saying I'm positive it's better math than what Edgar Bronfman Jr. [the president and CEO of Seagram, which owns Polygram] would provide. What happens to that million dollars? They spend half a million to record their album. That leaves the band with $500,000. They pay $100,000 to their manager for 20 percent commission. They pay $25,000 each to their lawyer and business manager. That leaves $350,000 for the four band members to split. After $170,000 in taxes, there's $180,000 left. That comes out to $45,000 per person. That's $45,000 to live on for a year until the record gets released. The record is a big hit and sells a million copies. (How a bidding-war band sells a million copies of its debut record is another rant entirely, but it's based on any basic civics-class knowledge that any of us have about cartels. Put simply, the antitrust laws in this country are basically a joke, protecting us just enough to not have to re-name our park service the Phillip Morris National Park Service.) So, this band releases two singles and makes two videos. The two videos cost a million dollars to make and 50 percent of the video production costs are recouped out of the band's royalties. The band gets $200,000 in tour support, which is 100 percent recoupable. The record company spends $300,000 on independent radio promotion. You have to pay independent promotion to get your song on the radio; independent promotion is a system where the record companies use middlemen so they can pretend not to know that radio stations -- the unified broadcast system -- are getting paid to play their records. All of those independent promotion costs are charged to the band. Since the original million-dollar advance is also recoupable, the band owes $2 million to the record company. If all of the million records are sold at full price with no discounts or record clubs, the band earns $2 million in royalties, since their 20 percent royalty works out to $2 a record. Two million dollars in royalties minus $2 million in recoupable expenses equals ... zero! How much does the record company make? They grossed $11 million.

http://archive.salon.com/tech/feature/2000/06/14/love/index.html

Re:Rock stars obviously aren't accountants.

[WiiVault]

The point being made tho is not whether or not 45k is a decent wage, but instead how the producers of the art get 45k while the suits get 11 million.