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SDMI: The Music Industry Strikes Back
phred writes "The music industry is fighting back by finalizing its Secure Digital Music Initiative says this story. The spec is due to be ratified at a meeting on July 7.
In the first phase MP3 and other formats would be playable on devices following the SDMI spec. In phase two, a "pirate screening" process will prevent copying a clone of a protected recording, a la the not-lamented SCMS format for CD and DAT.
" The RIAA claims that they are trying to protect artists' copyrights, while others, such as the EFF, are stating that the RIAA is merely trying to keep a stranglehold on distribution channels, and hence, their own bucks.
It is so much worse than you imagine. Read this: http://www.apk.net/cihs/verbal/albini.html
The summary from that article:
Record company: $710,000
Producer: $90,000
Manager: $51,000
Studio: $52,000
Previous label: $50,000
Agent: $7,5000
Lawyer: $12,000
Band member net income each: $4,031.25
The band is not 1/4 of the way through its contract, has made the music industry more than 3 million dollars richer, but is in the hole $14,000 on royalties. The band members have each earned about 1/3 as much as they would working at a 7-11, but they got to ride in a tour bus for a month.
Burn, Hollywood, Burn.
The internet as a liberator as well as a distribution model is an earth-shattering revelation, if artists can only be brave enough and sure enough in themselves to see it and appreciate it. On the internet:
The whole reason to get a record contract is to get on the radio and build an audience large enough to support tours, merchandise, advertising, etc. That's where an artist earns their $$$. What needs to happen is radio stations (starting with college radio) need to get on the net and use music from the net over regular radios (radio signals are still far more efficient and accessible than realaudio or icecast). Here's why a radio station should consider rebroadcasting net music:
(though radio stations would probably miss out on some payola, but then again, you'd have a war of dueling net.audio sites who'll sponsor syndicated shows.. 'the MP3.com biscuit flower hour' anyone?)
Screw the recording industry. Let's toast marshmallows on its burning remains.
Comming from an Audio Engineer's point of view, and being given an overview of Copyright Law by one of the best legal minds in the enterntainment industry, I think we need to evaluate what the artist's interests are. We all know that the record label's interests are to make money. Consequently, they are the ones that are initiating SMDI specification. The artists still don't see half of all the money that the record company generates on the sales of the albums.
The current process for a signed artist for creating a record and making money follows. The record company gives the artist a loan (for a secular artist starting out, it can be upwards of $500,000) to create this album in the studio. The record label usually assigns a producer--but artists with more clout can choose their own. The producer collects an up front fee for his services, and a percentage on the net sales of the songs he works on. The artist spends the next few months in a studio coming up with new songs. While the artist collects performance royalties on all the songs they record, that money is used to pay the record company back for there overly generous loan. They probably won't see any money from that set of royalties for two years. If the artist actually writes the song, then they will actually receive royalties on that right away. The real money the artist sees is from touring. That is where any artist worth their weight will cash in.
If the artist wants to see more money in their pockets, they can become their own record label. The artist formally known as Prince is a big advocate of this. The problem is getting the distribution channels open. If you already have a name established, then you should have comparably fewer trials in this area.
Royalties are payed each time the song is played on the radio, performed live, or sold in a CD. The standard royalties are ~6.9 cents per five minute song. If a song is over five minutes, it will receive an additional 1.5 cents per minute (rounded up to the full minute, so one second over five minutes is considered a 6 minute song). The actual numbers I gave you are a few years old, but they are in the ball park. That makes roughly 70 cents per CD (or $1.40 if they also wrote every song on the CD). When you have sheer numbers, the royalties can really add up.
I am a firm believer in keeping the royalty scheme intact. I don't believe that the record companies have anybodies interests but their own in tact. The royalty scheme was created along with the original Copyright Act to protect artists from being exploited by the record companies--much like unions were created to protect the worker from the abuses of large manufacturing companies. That is why all record company contracts (to my knowlege) are decidedly written in their favor. Only a fool would never negotiate over even one point on the contract.
The royalty payment scheme is enforced by one of three bodies (if the artist registers with them): ASCAP, BMI, or SESAC. There may also be a couple other smaller companies to perform this function. Basically, if ANY venue plays songs protected by their repetoir, the venue must pay a standard fee. Clubs, radio stations, and stores have a set yearly fee they have to pay (along with web sites that play songs in their repetoir--which includes an independant band's cover of a song they protect). Juke boxes and such have a per use fee. (here is a little known fact that I learned: any magnetic digital media has a small digital 'tax' that goes into the music industry--every disk, dat, or backup tape--regardless of what it is actually used for) (that was introduced when the record industry was afraid of consumer DAT tapes and drives).
It all comes down to a big racket. The artist and the consumer are the two big losers. So how do we fix the problem and keep artists and consumers happy? I don't know. Releasing a single on MP3 to generate interest in buying a CD is an excellent idea. It gives the consumer a taste of what the artist can do. The gain in good will offsets the loss in revenues, and consequently the artist will get a larger following. The Greatful Dead are testimony to that with their liberality in letting the consumers tape their shows.
While the artist is in control of the copyright (this also applies to software), they can use it as real property (like real estate). They can buy, sell, and bequeath it. American copyrights (after 1970) are good for 50 years after the death of the author. If they so choose, they can grant the general public the LISCENSE to freely copy and distribute any song they choose. That distribution does not include performance rights which would be a separate liscence. That way the artist holds on to the copyright so they can collect from radio stations and CDs, but still allow the net to distribute that song freely without fear of litigation. If the artist so chooses, they could even donate the song to the public domain, thereby releasing their right to the copyright.
Remember that once a song, software, or any creative work is written--it is copyrighted (In American copyright law--I can't say for international copyright law). The only thing registering it at the Library of Congress does is provide definitive proof that you came up with that creative work first. They don't perform any checking whatsoever. If someone tries to sue you for violating their copyright, that registry is the proof of the date that you created it. Sometimes you came up with it first, sometimes you didn't. Either way, if they didn't register it, then the case is thrown out because they have no proof.
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Perhaps it's just my being a lazy-ass and not thoroughly researching this topic from the artists being "protected", or it could just be that I really don't give a care about wasting my time to do the above, but it seems that I do not hear the actual ARTISTS complaining too much about mp3's and free music in general. Public Enemy embraces the technology, the Beastie Boys released a mix of a pretty good tune (the mix sucked IMHO) that wans't mp3, but was free. They plan to release more songs in the future last I heard.
I understand RIAA wanting to protect mp3s from reproduction, but then again, where were these great guardians of artists' frail rights when people were dubbing to cassette tapes oh so long ago!? I mean, high speed dubbing was a pretty standard feature on tape decks, and still is! I really don't think they made those so we could make copies of college lectures and recorded interviews. It was made so I could quickly copy my buddy's Bon Jovi "Slippery When Wet" tape in less than an hour.
Funny how when RIAA got pissed off at the Lyrics Database, I never read about a lot of artists getting in on the procedings. Look at that site now. I hate to say it, but it sucks. I used to love that site, but don't go there any longer simply due to the fact that the International Lyrics Server serves up the lyrics to absolutely no songs I have ever heard of. Thanks a lot corporate world, I appreciate that.
I think the RIAA thinks it has a good purpose, sort of like how most political extremists think they are right and everyone else is wrong. It would seem to me that artists would not mind mp3s. The more people who listen to their music, the more people will want to see them in concert. They make their living either way. I would really like to see some tool like Pinfeld or some other MTV VJ ask a question like "How do you feel about people ripping your music to mp3s and giving them out to their friends?" instead of "So, how cool was that last tour?" next time he had a really big super star to ask questions and kiss up to. At least then we would know how the artists (remember? the ones being "exploited" by mp3s?) feel about this whole matter.
One last thing, RIAA does all of this to jump on mp3s and yet I never hear their response to peoples' gripes over incrediblly bloated CD prices. If people could actually get a fair price on a CD, perhaps mp3s would not be quite as popular. The main reason I got into these things is because I could get them for free off ftp sites and did not have to pay Blockbuster their outrageous prices for something like "Poison's Greatest Hits" which probably contains all of about 6 songs, 3 of which I never heard of. When an EP costs $13 or so, we all ought to just bring our own KY when going to Blockbuster or Sam Goody or any of the other commercial rapists out there (not their fault, it's the music industry. But, they are the tools by which the rape is perpetrated).
Remember when Pearl Jam got so pissed at Ticketmaster? They blabbed about it wherever they could and rightfully so. But, I have not heard ol' Eddy Vedder whailing about how more people probably own a ripped version of "Vitalogy" than have actually bought the damn CD.
Just my opinion... etc.
/Sig/