A to Z of Making It, Copyright, Music, My Stories, Piracy

Compensating Artists

Social media connects artists to fans. And that is a good thing.

The issue is that a lot of artists use social media as a one way street to market themselves and push their product. But for people to invest in you, you need to connect with them, and there are artists who do it better than others.

Dee Snider comes to mind immediately as one who does a great job connecting with fans. Dave Mustaine and Sebastian Bach do a good job as well, while Robb Flynn and Nikki Sixx do a fantastic job. Another artist who has two way comms going is Corey Taylor. There are a lot more, I know and I follow quite a few.

A simple question from a Depressed Reds Fan user account to Corey Taylor on Twitter got me interested;

“Just curious, where does the main source of income come from? I’d assume touring and merchandise, but I really don’t know.”

Corey Taylor responded with the following;

“We HAVE to tour. It’s the only way we can make a living. Merch helps, but the merch companies make the lion’s share. Streaming is pricing artists – old AND new – out of careers.”

Another user “Rock Feed” added that;

“People have this idea that bands are filthy rich. Royalties are so low for bands once all the suits get their take.”

And this started a conversation from the fans about what they try to do as consumers to make it profitable for the artist they support to earn a decent wage and continue creating music.

But, in order to fix the argument about streaming payments or digital payments or how the artist can be compensated, there needs to be a line drawn in the sand, because it is NOT THE CONSUMERS FAULT.

As consumers, we stream, we buy, we go to the shows, we buy the merch and we buy the collector’s edition.

How much more can the consumer do?

Of course, according to the record labels, we should pay more for streaming. Because if we did, more royalties would go to the artists which is all BS. The royalties going to the artist would be the same regardless of what the streaming rate is.

What about the record labels paying more to the artists in royalties?

Then you have the government controlling the rate of payments, which means, music doesn’t operate in a free market, instead it operates in a government granted monopoly.

And Publishers make billions for doing really nothing and pay out nothing because hey, it’s the consumers fault and the streaming companies fault according to them.

Other posts from other artists got screen shotted and re-tweeted.

James Blunt said he got paid 00.0004499368 pounds per stream. Beers are on him. Another user jumped on that and did the math that 1,000,000 streams of a song = 440 pounds. And when you split that amongst band members it doesn’t add up to a lot.

Another user called Source Code tweeted that they read;

“The Who back in the 70’s started a tour 40K in debt. They had a very successful time but afterwards the band were told they were still 40K in debt. It wasn’t the drinking or smashing up equipment that cost them, it was the anonymous greedy suits stealing.”

Corey Taylor re-added that;

“Musicians are LITERALLY the last to be paid”.

And that is true.

Artists are paid once all the expenses are paid. That advance payment has to be recouped. Studio time and promotion needs to be recouped. Legal needs to be paid and Management needs to be paid. Somewhere in between, the digital service provider takes up to 30% of the royalty paid. The label takes the rest and then distributes what the contact states to the artist. Then you have the publishers. Same deal there. The digital service provider takes up to 30% and the publisher takes the rest, distributing the money according to the contract they have with the artist. If the artist sells vinyl and product, they get a higher rate once the monies are recouped.

You know when you see articles like Steve Perry signing a publishing agreement or Nikki Sixx signing a publishing agreement and you can interchange any other artist who has a valuable back catalogue into the phrase.

Well, those artists don’t sign those agreements and get nothing in return. Obviously they are in a position of power to sign an agreement to their terms and get a favourable royalty rate, but there will be rules that the publisher would pay up front an advance fee and recoup that fee over the term.  

And when artists go out on tour and depending on their pull, they even scalp their own tickets to make more money on the show, because why should the booking agent, the venue, the parking stations and the food places make more than the artist. It’s wrong but legal.

Phil Labonte from All That Remains posted that their biggest song has 67 million views on YouTube and they have over 1.3 million monthly listeners on Spotify but see nothing from it.

Phil further mentioned that the band ends up making between 10 to 15% of gross on a tour. Then they need to split that amount 5 ways and pay their taxes. Once that is don’t, they can start paying their bills.

Bigger bands, will take an upfront payment and then negotiate this per show split afterwards.

But for a smaller band, if they have a show that has 1000 people at $20 a ticket, then that is $20,000 in gross earnings. Based on Phil’s numbers, the band stands to make between $2K to $3K for the show. Split 5 ways, it’s $400 to $600 per person. Play 20 shows and if you get the same crowds, then that’s $8K to $12K per person. Gross. Then tax.

And by the end of all the conversations, the artists didn’t care how people got the music, they just wanted to be compensated.

But music operates in a government granted bubble, and not a free market price, so the prices set are relient on Copyright rules (created by the Government) to make up the difference.

Artists tried “pay as you want” bundles (which is a way to test what the free market would pay for your work) and I don’t see too many of those bundles on offer today.

And there was two way communications between Corey and fans, who said, that since Corey plays music in a genre which isn’t popular, how can he expect to make coin on royalties to which Corey replied back with that he doesn’t believe that is the case, as all of the shows sell out and the genre is popular to the masses.

Its back to the same old argument; metal fans don’t stream as much as pop fans. And as an artist, do you want your fans to buy your album or stream it or both.

The best part of all of the conversations was the comment from Corey which said;

“As long as the RECORD LABELS get THEIR money, they don’t CARE if the ARTIST gets paid at ALL. Or who plays their music – unless it’s a critic on YouTube, THEN THEY’RE UP IN ARMS.

So much truth there. The bottom line is this; the Record Labels own a stake in Spotify. And they own this stake, because they had negotiating power from all the Copyrights they held, who really should be owned by the artists.

Did anyone notice that Tool recently entered the world of streaming?

And they would have done it on their terms, and their own rate. And they will be well compensated.

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2 thoughts on “Compensating Artists

  1. Basically, these bands do it for the music not for the payout as there is not much of a payout by the sounds of it for many.​
    Great writeup

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