What A Surprise: Musicians Claim Label Is Cheating Them Out Of iTunes Royalties
from the big-surprise-there dept
It's always amusing when the recording industry (and its supporters) focus on how helping that particular industry is the equivalent of "helping the artists." Historically, the two sides have often been at odds -- with it being fairly common for many musicians to claim that their record label cheated them out of money owed. The latest is that the Allman Brothers Band and Cheap Trick claim that their label, Sony Music, isn't paying them what they're owed in royalties for songs bought on iTunes. They're getting 4.5 cents, rather than the 30 cents they believe they're owed. In this case, it's clearly a contractual argument -- with it being unclear what category in the contract an iTunes download falls under. The folks at the label claim it's in the classification that gets the smallest amount, while the bands claim it's in the one that gets the largest. Nothing is that surprising about this type of dispute. However, what could make it interesting is if the bands prevail (which is probably unlikely). Plenty of other musicians would quickly line up for their missing royalties as well -- and it could take a bit of a dent out of the recording industry's digital profits while increasing their ignored demands for higher download prices. Either way, it's yet more evidence that the recording industry's and the musicians' interests are quite often not aligned.
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It's odd that this would suddenly come as news to anyone. Not the old "record labels cheating musicians" shtick, but the "how does our contract cover THIS media type". The journalists having their work republished as newspapers went online was another big one. Framing the debate as simply a "musicians vs. labels" issue would be a big mistake. This is everyone's problem who receives royalties from content they help produce.
As the performers begin receiving royalty checks, and stop getting the run around when asking what percent of what is what... that's when the other shoe falls. More people need to walk around with their eyes open than do now.
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Am I missing something?
Big Music has a long history of shafting musicians. They used CD to lower payouts (royalties) while raising profits (prices). Like you said, more artists need to keep their eyes open and READ THE CONTRACT!
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Re: Am I missing something?
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Sony has it right, the artists have it wrong this
How on earth can anyone believe that a download from iTunesis is more similar to a movie licence than to a CD sale? Besides, as the article says, "newer contracts treat digital downloads like a CD sale and thus allow for the smaller payments to artists".
So basically these people, just because they signed with the label before digital download was available, believe that their case should be treated differently than the others, and happily equate digital download to the licensing of a song in a movie? But why on earth?
Mike, as much as I appreciate your constant bashing of the greed of big corporations in the music business wrt digital access, in this case your title seem to defend the bad guys: the artists are the greedy ones here, and the big corporation is just trying to compare apples with apples and oranges with oranges.
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Re: Sony has it right, the artists have it wrong t
It's neither. Unlike a CD sale, a download is almost 100% profit.
Naturally Big music wants to pocket ALL of it... and that's what we are seeing here.
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Re: Re: Sony has it right, the artists have it wro
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Re: Sony has it right, the artists have it wrong t
If they get 4.5c a CD and 4.5c a download, wouldn't it stand to reason that if their CDs weren't "one hit wonders" that they would in fact make MORE money on the downloads?
I hate the RIAA as much as the next guy, but in this case it seems to me that the musicians are just plain wrong.
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Re: Sony has it right, the artists have it wrong t
Just One Guy,
You're jumping to conclusions here. Neither the title nor the post takes one side or the other. All I pointed out was historically the two sides disagree on things like this and that it was a contractual dispute with both sides trying to get the most out of it.
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Re: Sony has it right, the artists have it wrong t
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Re: Sony has it right, the artists have it wrong t
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Re: Sony has it right, the artists have it wrong t
In iTunes sony has no cost. They aren't even paying bandwidth, and thus they should not charge the artist for costs they are not incurring.
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Re: Sony has it right, the artists have it wrong t
90% of artists today find themselves in a non-recoupable state, and cheap consoumers want to steal from the artists just like the labels do.
The RIAA acts on behalf of all artists as a union to protect their rights on all issues related to the sale of their music. Do we go to the UAW, and gripe and grime about the price of cars, or to OPEC to gripe about the price of oil and gas??
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The tired old
For years, people have bought album after album only to find that they purchased two good songs and a load of filler. Can you blame people for wanting to sample before getting disappointed again?
For years kids recorded off the radio; they were not cheating the business out of sales. The music business realized that by allowing this they were cultivating future consumers. The Music business has lost sight of this.
Those kids are now downloading like crazy. Draconian laws will not stop this, though it may put them off buying music when they grow up.
A major part of this misunderstanding is that copyright is really not about copying - it is about the right to commercially exploit and artist's work.
Yes, there are thieves out there, but I believe that there is also a lot of potential business. A certain Russian website has shown that people are willing to pay for good-quality DRM-free downloads. The only point of contention is the price. I, for one, will not pay $1/song. I can get legitimate CDs for less than that, and I refuse to pay more for less, which is what Big Music wants.
The RIAA acts on behalf of all artists as a union to protect their rights on all issues related to the sale of their music. Do we go to the UAW, and gripe and grime about the price of cars, or to OPEC to gripe about the price of oil and gas?
What's your point?
Lately, the RIAA has been acting more like the Mafia than a union. Besides, the RIAA is made up of those who own, produce, distribute and sell content - if they are not the legitimate targets for our bad feeling, who is?
There has to be a compromise here. The problem is that having bought and paid for the latest round of copyright laws, the music business is now operating on the following assumptions:
1) It's our stuff.
2) They're all thieves.
3) We must stop them.
And they wonder why the buying public is walking away.
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...actually
- CDs are a physical product that has to be produced and distributed on a very large level.
This cuts out the manufacturers of the CD as well as the distributors. Those people do NOT get a cut.
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Re: ...actually
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Re: Re: ...actually
Artist to Label: Yes you marketed my latest album really well, but you didn't market the downloads and they cost you nothing, materially, to offer the world, so the only reason somone wants it is because of me and only me (my music, that is). So I should get more of a percentage than I get for a CD. in fact if you hadn't marketed my new album, it would have a minimal impact on the number of downloads, because most people who download music are already fans of my music and would have discovered it on thier own, not even knowing I had a new album out.
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The music industry
For the cost of websites these days if I were a musician, I'd sell my music DIRECTLY off of my website. I mean HOW many copies would you really have to sell before you couldn't handle it yourself? And when it did becoem overwhelming, just contract with a fab plant to make your CDs for you.
But I guess thats why they're musicians and not engineers or business people.
In the whole age of JIT and cheap technology, I see record companies as being obsolete alltogether.
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Re: The music industry
We set up our own label for ourselves and a few other bands and only sell albums from the website. But at best we only sell about 10 albums a year.
Despite good reviews.
So why do we not sell many cds?
we're crap? ( we only need 5000 people to like us in the world)
people do not notice the poor qulaity of mp3s
or people only buy what has been marketed to them?
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Re: Re: The music industry
After having a No 5 hit on the R&B charts and writing a song on the LOX's Platinum selling Money , Power, Respect CD I decided to get into video as I can control all my rights and sell and market DIRECT to the stores
I made decent money on music..brought my own song on Itunes and have yet to see it appear on my BMI statement I HAVE seen royalties for ringtomes and MP3.com thou. S Jobs and the Record companies are A holes ...big time!
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Re: The music industry
Technology has made it inexpensive to record and release your creative piece. As someone who has examined these self-releases on a daily bases for over a decade I can tell you, without any equivocation, that most of it is complete crap.
So, conceptually, cheap technology has made the old-school version of the record label obsolete. The painful truth is making a living as an artist is still desperately difficult. Without financial backing in the early stages, next to impossible.
Without filters, the sheer numbers of poorly realized music (film, fine art... whatever you want to insert here) creates an impossible roar where no one makes a living and the business of music collapses upon itself.
Until social-networking proves that it alone can generate enough sales to make self-released artists self-sustaining, the concept of the record label is a necessary evil in the business of music.
LEG
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Re: The music industry
As someone who has been a studio musician all his life, I deal with record labels all the time, and am not a big fan; having said that, however, labels spend a ton of money on promotion and product placement. They're not paying artists their due, but at the same time, they take the risk on new artists. There have been tons of albums produced which never make it to the stores, only because the labels spent money for development and then realized that the finished product wasn't good enough.
Development costs for new artists is pretty high; in Nashville, development deals happen all the time, but most of these new unknowns never make it into the stores. All of this goes into the overhead for record labels.
So that's the other side of it... I still think labels take too much of the profits, but it's not quite so outlandish as a lot of people tend to believe.
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My take
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you keep forgetting...
Simply giving up labels and going independent is NOT a reasonable solution now for any artist. No radical confrontation is possible. The only solution is to slowly change the mind and behaviors (and, of course, contracts) of labels.
And who can do that? Not certainly new artists, that simply do not have the leverage. Not old dinosaurs such as Allman Brothers or Cheap Trick, that live basically off sales percentages of old records. Only current, hip, trendy, well-recognized artists at the end of their current contract and negotiating a new one.
People like Madonna, or Beyonce, etc. that can reasonably guarantee a few more hit records in the future and that can quit from label A at any moment and try their luck with label B. If these people started arguing with their labels about digital rights, online sale percentages, and ownership of distribution and sales rights, then labels would slowly start thinking of a new business model that can accommodate these new technologies and their earnings.
You simply do not put gigantic enterprises out of business by sheer will force. They will simply ignore you, and in case of need make one phone call to their senator and have a new custom-made law approved and in force before you can even bitch about it in techdirt. Sad but true.
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Who
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Just a website
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On the other claw....
The question really comes down to whether the labels are still effective at marketing. I can put up a website, cut a CD/R full of music I've produced, and that's fine. Many bands are doing that - but what's the level of exposure they get that way? It's the marketing that's always been the expensive part - ads in papers, selling the discs to the retailers (with the co-marketing expense and discoutns and buybacks and all that) and sending out the promo copies to the radio stations. That's how the market gets built to sell lots of records.
In the download era, it's functionally the same - how do you build a following for "Bruce from Bethesda"? You can start by fans from live shows, but spreading the word from person to person isn't quick. There's lots of bands doing it that way - take a look on epitonic and soundclick, for example. (Or CDBaby) - lots of non-label bands to pick from. What ones sell millions of copies/downloads? Mostly the ones marketed by labels. Why? Are they that much better? Probably not (although sometimes the sound quality of the professional recording helps) - I've found some great independant music that's at least as good as the best from the labels to my ear. It's getting the information out that drives it - whether its' the physical CD into the record store, or the information that there's a new release on [insert favorite download store name] that drives the mass market.
As long as marketing is needed, the labels will continue to exist, and rake in the majority of the profits - they're the ones taking more of the risk by the initial cash outlay.
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Agreed
- Bruce
Your right. But we are not the "general" population. Peole are interesting animals, we are not only just creatues of habit but also creatures of convenience.
Average Joe: I've always bought CD's so why stop now? Yeah, there a little more expensive now, but what isn't? iTunes is cool, I'll start using that...sweet, it works great with my iPod, life is good. Gosh I love pop, just like what is on the top 40s station. Wait, you want me to try to find new stuff off the web? Who are these people, have I heard of them? Oh well...back to listening to the radio and watching MTV for my "new music"
Techdirt User: RIAA sucks, screw them. I'll go find alternative music sources...(tracks down bands he/she likes) sweet no DRM!
Big Label: Hmm, there are all of these 10's of hundreds maybe thousands of techdirt people wanting a revolution, they want us to change our business model (our precious)...hmm, nah we'll stick to the millions of average joe's out there, they don't really seem to care.
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Re: Agreed
There you go speaking truth again, Bruce. Don't you realize nobody's listening to that stuff? It's too hard to handle, even though its the only ride from here to where we want to go. Money talks, BS walks. I question whether the average TechDirt user petitions his senator on a regular basis. Why we let the Christian Coalition have all the fun, I'll never know. If I million people yell into a bottomless pit, they're still a silent majority, by virtue of "direction" alone.
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Re: Sony has it right, the artists have it wrong t
itunes loses about 23 cents to credit card company processing fees and, 65 cents to paying record label royalties. the rest is profit for apple. small margins for apple if you ask me.
source (new york times): http://www.nytimes.com/2006/04/27/technology/27scene.html?_r=1&oref=slogin
another tid-bit of info: it costs less than 15 cents to mass-produce a CD... and i still dont see any albums for under $10 :(
this is rediculous.
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Re: Re: Sony has it right, the artists have it wro
I hope that was supposed to read "2-3 cents" because the surcharge is only about 3 percent, AFAIK. You couldn't afford to stay in business if the credit card companies charged 23 percent for processing fees.
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Cheap CDs ARE out there
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Indies can do it
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The writer and publisher are really the ones who profit from CDs. They get a cut from every song and every broadcast. If the artist is not the writer and/or publisher they really miss out.
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They didn't already expect to get screwed by the music labels and the RIAA.
LOL, that's funny....
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Re: Sony has it right, the artists have it wrong
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Who the hell are these artists?
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Re: Who the hell are these artists?
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Re: Who the hell are these artists?
But seriously, royalties are the way to do it. We're fine with you getting a cut of every purchase of your software, but you'll need to stay "in the loop" for upgrades and patches for the foreseeable future. Unfortunately, artists are free to leave the crap right there on the recording! Someone out there will find it appealing and purchase it. So much for mass marketing. It's all in the numbers.
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Re: Who the hell are these artists? Jealousy?
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Re: Who the hell are these artists?
No you don't get paid for reinstalls, but you may charge for media replacement and I am sure you charge more than a cd for it if your software is worth anything.
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Re: Who the hell are these artists?
r0g
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check is in the mail
So what if the song costs $1.99; the artist knows that pleasing the consumer is better than making sure the C level staff's golden parachute is growing.
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Artist Royalties - Solution
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RIAA is twofaced
"The case hinges on whether a digital download is comparable to a sale of a CD, as the labels contend, or more on par with a license of a song for use on a movie soundtrack, for example, as the artists claim."
Let me get this right, the lables justify DRM by saying they are licensing the music to consumers but when they are dealing with artist contracts, it is a sale. I hope the artists recognise this and nail the RIAA to the wall in court.
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What is going on here ?
Artist ? Creator and OWNER of the music (usually)
Label. Company that creates a biased one sided monopoly so they can make biased one side indentured servitude contracts want to sell ARTISTS music and let me get this straight.
You think the label deserves a larger profit than the Artist of the music ?
How in the world can you brain create such a thought ?
So if I write a book and get a publisher to make it once you subtract actual costs and have nothing but profit left you think the publisher should get MORE of it than me the writer of the book ?
are you ACTUALLY trying to say that this is how it should be ?
Only one type of person could come up with such insane flawed logic - a label.
Its DISGUSTING that artsists basically get NOTHING from CD sales.
1 million CD sold for 18 million dollars
Artist cut ? 40k ?? Label Cut 14-15million ?
You REALLY think thats fair ???
Man what TWISTED sadistic world were you born in.
Oh thats right THIS sadistic twisted world.
Chris Taylor
http://www.nerys.com/
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Stupid
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As soon as Apple opens up iTunes for bands to submit their tracks themselves (rather than labels) watch the floodgates open and cause the instant demise of record lables as we know them! Instant global distribution.
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STOP STEALING FROM ARTISTS!!!!
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Sad to Say, Labels Are Needed in 2006
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As long as they make a buck.... they don't care.
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ok but,
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