RIAA Math: Sell 1 Million Albums, Still Owe $500k

An anonymous reader writes "For all the complaints from the RIAA about 'pirates,' who are the real pirates in this scenario? Through a variety of contractual tricks, it's nearly impossible for artists signed to major labels to get paid. The article and video detail how an artist who thinks he's getting a 10% royalty is actually getting closer to 2.5% through various tricks placed in the contract. The labels, then, end up with 97.5% of the gross revenue, and anything they 'spend' on the artist continues to come out of the royalties, not the labels' cut."

Comments

Shysters all

[dosius]

This is why I say fuck the MAFIAA.

-uso.

Re:Shysters all

[LordLimecat]

Given that weve seen similar stories for years (hollywood accounting, unfair contracts, better off going alone), 2 questions spring to mind:

1) Surely enough people have been burned to set up a class action lawsuit and /or lobbying for new regulation/legislation towards Hollywood / the recording industry for their accounting practices; Im generally gun-shy of unnecessary regulation but this seems to be an area where audits would be helpful, and the odd multi-million-dollar judgement might not hurt either

2) If these contracts are known for being so bad, why do people continue to sign them? I sympathize if the contracts are simply not being honored, but if it continues to happen and people continue to sign the contracts, my sympathy begins to wane. I do NOT want to get into a situation where contracts are no longer enforceable because of legislation protect people from sneaky contracts; people DO bear responsibility for contracts that they sign if they are upheld to the letter of the contract.

Articles like this make me really nervous because they may have a valid point, but I am terribly worried about the results of overambitious and overreacting legislation.

Re:Shysters all

[mooingyak]

If these contracts are known for being so bad, why do people continue to sign them?

Lets say 95% of people are smart enough not to sign one. If you work for a record company, it means you only sign up people who fall in that 5% category. The pool of people who could actually make money for them will always be large enough that they can afford to ignore the rest.

And it gets worse. Let's say I started a record company today, and I genuinely want to do right by my artists. If I don't employ the same money squeezing tactics that the existing labels do, then my margins suffer and the only way to succeed is to have a much higher success/flop ratio with the acts I sign than everyone else. And that's not trivial to pull off.

Re:Shysters all

[bberens]

98% of all media are owned by less than 10 conglomerates. Where do you suppose you'll be advertising?

Re:Shysters all

[jawtheshark]

With all due respect... Are you implying that you are entitled to make money with what you love doing? I assure you that's not even remotely close to how reality actually works. Most people have a day job that they either accept as "necessary" or flat out hate it. Many people, including me, used to love what they did, but the realities of the workplace and business requirements usually put a halt to that. My dad always used to say, "Find a job you love and you'll never work in your whole life". As a matter of fact, I have a corollary to that: "Find a job you love, and lose your love for it". Yes, I still love programming, fiddling with hardware (e.g. dumpster diving), helping out people with their computer problems, but it's for my own and for the people I care about. My job, is just that... a job.

What about the people who love things like D&D or simply going for a walk in the forest? Should they be able to make money of it? Sure... They should have the right to attempt that, but reality will kick your butt quickly.

My wife would love to make her money with her paintings. She's pretty good, but to make a living out of it? I'm doubtful, may happen, but only if someone rich actually fancies her art and gets her out in public.

Re:Shysters all

[Hatta]

Surely enough people have been burned to set up a class action lawsuit

They tried that in Canada. Out of $6 billion owed to artists, all they were able to get was $50 million.

If these contracts are known for being so bad, why do people continue to sign them

Mostly because it's their only shot at stardom. They don't pick people with talent who could hack it on their own. They pick kids from podunk towns just dying to get out and be famous.

Re:Shysters all

[Artifakt]

There are a whole hell of a lot of people who want to make it big big! BIG!!. Just look at all the people who are waiting for their big break in Hollywood while waiting tables or washing cars - there are literally a million people jockying for those few '10 Million a picture' jobs, and 99.something % of them have no chance at all by any objective measure. A person who gets a screen credit in a single motion picture during their acting career is in the top 1% of screen actors guild members. People most viewers think of as middle of the line actors (i.e. Whoopee Goldberg), are statistically in the top 1/100th of 1% by earnings, number of films or shows they have appeared on, recognizability and similar measures.
          This goes for somewhat lesser extent for pop musicians, athletes (particularly football players) and many others. There's really no point in asking If these contracts are known for being so bad, why do people continue to sign them?, because it's like asking these same people why they took that triple dog dare and got their tongue stuck to a pole. An actor/rockstar/celebrity is either an idiot who has let his dream of being big enough to overcome the emptiness in his soul overwhelm everything else, or he has some actual understanding of the odds, some actual understanding of his own worth, and (by the time he's done a few contracts) knows that all those idiots aren't just competition, but a thing that keeps the real actors down come contract time. Any serious actor is aware that the producers can always find somebody who will do the job for a pittance just to break in. He or she is aware that the producers have a generalised contempt for the actors they deal with that seems fundamental to their business models, and that he or she has to negotiate every deal through that. He or she swiftly hires an agent to handle that part.

Re:Shysters all

[BoberFett]

Hey there Mr. Indielabel that's a nice little website you have there. It'd be a shame if anything happened to it.

Oh, by the way, it sounds like one of the artists on your little label wrote a song that sounds similar to one of our millions of copyrighted songs, so we're suing you for $1,000,000,000 right after the Division of Homeland Security shuts down your website for copyright infringement and the SWAT team kicks down your door.

The rise of indie

[theillien]

With the ability to distribute online so easily these days, I don't know why artists even bother with major labels anymore. I'm sure with a little investment even the smallest artist can attain a decent marketing campaign. Word of mouth and social networks are a wealth of free publicity as well.

Re:The rise of indie

[bsDaemon]

Unlike self-publishing, indie labels and self-sales/recording have never had the same stigma of lack of legitimacy. However, I think there is still an impression, even among the artists, that getting signed to a major label is what "success" means. It might be due to confusion in that success and slavery both start with an 's'.

Re:The rise of indie

[KDR_11k]

And yet even with all those roadblocks you're likely getting more money by staying independent than by selling yourself to the labels and living in slavery. Only the overproduced stars that are pretty much a disposable cog in the music industry and chosen to be advertised big get big money to keep the dream of being a rock star alive and musicians willing to sign up despite getting screwed.

Re:The rise of indie

[maztuhblastah]

- The MafiAA control the booking for 99% of the performance venues that seat more than 50 people. Get yourself to a large enough following, and you'll have problems. Piss off the MafiAA by being independent too long and they'll have you blackballed from performance venues.

Indeed. This is why artists such as Dispatch were never able to play venues such as Madison Square Garden, and were unable to get more than a few people at their show at the Hatch Memorial Shell.

Oh. Maybe not...

Don't sign it

[Neil Watson]

The RIAA is not fully to blame here. If I don't like a work contract I get it changed or walk away. If someone is too eager to be famous to take the time and negotiate I can hardly feel sorry for them.

Re:Don't sign it

[Tsingi]

The RIAA is not fully to blame here. If I don't like a work contract I get it changed or walk away. If someone is too eager to be famous to take the time and negotiate I can hardly feel sorry for them.

I totally agree. But then, I never have any problems finding work.

However, it is something of an elitist attitude don't you think?