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MySpace-Imeem Deal Leaves Indie Artists Unpaid
azoblue writes with news that following MySpace's acquisition and shutdown of imeem, independent artists who sold their music through imeem's Snocap music storefronts (on MySpace and other sites) won't be paid what's owed them. More than 110,000 artists are believed to be affected. The crux of the problem is that MySpace acquired only a certain portion of the assets that were imeem — "the domain name and certain technology and trademarks" — and not imeem’s outstanding debts, including the money imeem owed to artists under the Snocap relationship. According to the article, some artists have been owed money for more than a year. "Napster creator Shawn Fanning co-founded Snocap in 2002 to let artists sell their music through an embeddable storefront widget. At one point, the service was marketed as the exclusive way for artists to sell music on MySpace. Imeem bought Snocap last summer. But because MySpace left most aspects of Snocap out of its acquisition of imeem’s assets, all 110,000 or so of those storefronts are gone. The server that hosts them is offline and so is the Snocap website."
This is what happens in insolvency. There isn't enough money to pay debts. Occasionally the entire business will be worth enough to someone that they will be willing to take on the liabilities, but most of the time there is no option but to sell off whatever does have some value as assets. Myspace didn't buy imeem, they bought some of their assets.
The money paid for the assets will go towards paying creditors, though creditors are usually ranked so that a lender with a fixed security (e.g. bank loan) get paid first, then it's the employees, and down it goes. The order is broadly as fair as possible in the circumstances (not to say that it's satisfactory to anybody who doesn't get their money, but the money simply isn't there to do so).
Nor is there anything morally wrong with it. The fault it wholly with imeem. It failed, it could not pay it's debts. To imply Myspace is at fault here is completely false since their offer was the one that returns the most money to imeem's creditors - it makes more (but still not much) sense to say every single other entity on the planet is more at fault than Myspace, because none of them made a better offer.
(Not that I like MySpace, and certainly not Newscorp, but that's just how it is)
I've been through asset both buying and selling. It will be hard for MySpace to pull this off as the courts may not see the sale as a pure asset sale. It's one thing when you sell buildings and plant equipment. It's quite another when you sell the essence of the business: the brand, key employees and the customers and vendor relationships (musicians). Unfortunately, because this likely will be a class action, the musicians will be screwed a second time when the lawyers swoop in and get 40-60% of the settlement.
Time to cue up "That old class action" by Dewey, Cheatham & Howe.
-- $G
You take that back before I give you the Celine Dion Limited Edition Discography including audio of her interviews and outtakes!
I hate printers.
Why does that matter? People bought their music, they should get paid.
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No, I think it was camouflage for their total inadequacy when it came to running a business.
I hate printers.
I've been trying my best to ignore that particular definition of "indie". It's difficult, so instead I use the word "independent" whenever possible.
Better get the RIAA after them! Oh, wait...
Chaos maximizes locally around me.
I know, right?
More importantly, people not only bought their music, but they paid imeem for it, which basically just kept the money instead of honoring their contract with the artists.
In the sale of imeem to myspace, you can bet the lawyers got paid, and the guys from imeem got theirs. MySpace should honor every one of those contracts instead of just writing them off as "bad" debt.
You can bet that if it was the artists who were the ones breaking the contract with imeem or myspace, lawyers would be crawling up their asses with wire brushes.
This is why I hate to do business with anyone that I can't actually go put my hands on if need be. I do it of course, but I hate it.
You are welcome on my lawn.
OK, so I'm an "indie" artist, and I have a ton of friends who are indie artists as well. We actually just got signed to a minor record label after years of trying to sell our CDs at gigs, carshows, and chick-fil-a grand opentings, etc. Fortunately, we used iTunes to sell our music instead of imeem. I have to tell you that at .99$ a tune we weren't making a whole lot of $$. In fact, all of my indie friends mentioned above pretty much have full time jobs to pay the bills - the music thing for most of us is something we do just because we love to play.
The point is that I would guess that the imeem accounts are probably just micropayments - maybe in the range of 5-20$. I wouldn't expect any laywer to go after this kind of chump change, not even for a class action suit. I think us poor starving musician types will just have to suck it up as usual while we get hassled by the man.
Actually paid == payed. Payed is an archaic form of paid, which is obsolete in most circumstances. Apparently it's still correct in the nautical use as well as for payed subscriptions. Hell even the spell check in Firefox accepts it as legimit.
If you're going to be one of those annoying grammar nazi pricks, the least you could do is be right.
But you are making the same mistake, basing quality on commercial potential. For why that don't work, just come on down here to the south and take a stroll down places like Beale Street in Memphis, or the "musical main" street in LR, AR. Here you will find some really incredible players playing some truly awesome "get yo ass up and let's have some fun" R&B, blues, funk, soul, rockabilly, all truly great stuff. But in all likelihood you will NEVER hear of these guys outside the clubs, and they will never get famous. Why?
Because those styles of music isn't considered "popular" by the guys that hunt for record labels and the stations they market to. They know how to sell Britney and teen pop idol crap, not good old fashioned Muddy Waters style blues, wall shaking rockabilly and R&B that has such a hard driving beat it'll shake your bones, etc. They don't like it, or get it, so it just won't be marketed. Then there are those that refuse to sign over all rights to everything they'll ever make, which in the business today means they'll never have a contract, because the industry is so tilted in favor of the money men.
So please don't mistake "commercial potential" for quality, because the ones that decide that are the same ones that gave us pop idol crap and mall band pretty boy o' the week. I've got plenty of independent CDs made by guys and gals that if you and your girl saw them on any Saturday night would have you out on the floor laughing and dancing and having a damned good time, but they just don't fit into one of the cookie cutter "popular" molds that the A&R guys only seem to care about. And as far as they are concerned that is fine, because it is about THE MUSIC, not whether they'll get a gold plated bath tub or not.
ACs don't waste your time replying, your posts are never seen by me.
Given Rupert Murdoch's recent comments about copyright thieves stealing content, I'm sure the owner of MySpace will act quickly to ensure that these musicians get the royalties they are owed.
GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
I can't tell if you're agreeing or disagreeing with the grandparent poster...
Make me a friend and I'll mod you up