Copyright, Music, Piracy, Stupidity, Treating Fans Like Shit

The Real Copyright Abusers Are The Major Record Labels

The major Record Labels own the majority of copyrights and don’t they love to overvalue their content. As soon as a product is seen making money or drawing an audience from music, the big copyright owners swoop in. And when they do swoop in a few things begin to happen;

The Product will get threatened. Think of Napster, Limewire, AudioGalaxy and MegaUpload. All gone. Pandora is constantly battling against rates of payments as they struggle to make a profit. Spotify, in order to trade in the U.S had to give the major labels a share of the company. It was either that or the labels would not license them. Google is always blamed for linking to pirated content.

The Product will get litigated into non-existenance. Mp3.com, hotfile, isohunt are three that come to mind.

The Product will move on to different areas of innovation.

The Product will get saturated with content from the copyright industries that a lot of the people who flocked to the product in the first place will just move on to another product.

Like MySpace.

MySpace was once a haven for finding out independent/underground music. The whole culture and market reach of MySpace was built around this premise. Of course MySpace got so popular that it was inevitable that the major legacy players would take notice. Eventually, MySpace was littered with content from the major players. Ads of major label artists popped up everywhere and all of the independent content that made MySpace popular got pushed further into the background, making it harder to find.

Eventually those people who made MySpace popular started to abandon the site in droves, moving onto other social media sites, like Facebook and YouTube.

Anyone heard this quote from Robert A. Heinlein.

“There has grown up in the minds of certain groups in this country the notion that because a man or corporation has made a profit out of the public for a number of years, the government and the courts are charged with the duty of guaranteeing such profit in the future, even in the face of changing circumstances and contrary to public interest. This strange doctrine is not supported by statute nor common law. Neither individuals nor corporations have any right to come into court and ask that the clock of history be stopped, or turned back.”

Does it all sound eerily familiar? Does it sound like the attitude of the content industries for the last 40 years?

The MPAA and RIAA have never stopped lobbying the Government to pass laws that will protect their business models. Even Irving Azoff still blames technology for diminishing the music business profits instead of blaming the real devil, which is the GREED of the POWER PLAYERS. Someone like Azoff had a career on the backs of music that artists created.

The blame should be at the way the Record Labels/RIAA treated their artists and the fans of the artist.

The blame should be in the way the Labels creatively structured deals to ensure that most musicians never get paid a real dime.

Yes, back when the Record Labels controlled everything, artists are given advances, however the real term used should have been “loans on terrible repayment rates” in which the labels would add-on every expense that needs to be “paid back”.

Very few musicians ever “recouped” even after the labels made back many times what they actually gave the artists.

RATT sold 7.5 million albums in the U.S alone which meant total gross sales of $75 million. Even if the label gave them $1 million dollar advances for each album, that is $5 million the label would have spent on the band and in the process the Label made $70 million. I bet if the financials are made available, it would show Ratt as a band that still hasn’t recouped.

There is a post over at Techdirt that covers this in a bit more depth. The following comments are from Tim Quirk and how record label accounting relates to his band, Too Much Joy (TMJ):

A word here about that unrecouped balance, for those uninitiated in the complex mechanics of major label accounting. While our royalty statement shows Too Much Joy in the red with Warner Bros. (now by only $395,214.71 after that $62.47 digital windfall), this doesn’t mean Warner “lost” nearly $400,000 on the band. That’s how much they spent on us, and we don’t see any royalty checks until it’s paid back, but it doesn’t get paid back out of the full price of every album sold. It gets paid back out of the band’s share of every album sold, which is roughly 10% of the retail price. So, using round numbers to make the math as easy as possible to understand, let’s say Warner Bros. spent something like $450,000 total on TMJ. If Warner sold 15,000 copies of each of the three TMJ records they released at a wholesale price of $10 each, they would have earned back the $450,000. But if those records were retailing for $15, TMJ would have only paid back $67,500, and our statement would show an unrecouped balance of $382,500.

So going back to my Ratt example, it is a well-known fact that artist in the Eighties signed contracts that gave them a 5% cut of the album sold. Do the math? I am pretty sure it will come out that Ratt didn’t recoup.

As the Techdirt post pointed out;

“In other words, musicians don’t get paid anything in most cases, while the labels can earn a tidy profit for years and years, still insisting the band hasn’t recouped. It’s why a band can sell a million albums and still owe $500,000.”

The whole doctrine of “getting the government and the courts to guarantee profits in the future” is the reason why copyright trolls like Rightscorp have come into existence. It has also given rise to law enforcement working for the content industries as a pseudo “Copyright Police”, which in reality was always a civil matter, never a criminal matter.

In the end, the real copyright infringers and abusers are the actual Record Labels.

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

Time Is Working Against The Artist

It’s 1992. The labels are signing Seattle bands, left, right and centre while at the same time they are dropping hard rock and heavy metal bands left, right and centre. That is the power the record label had. Not only could they make an artist famous, they could also destroy an artist. You see when you control all the points in the distribution and marketing chain, you more or less control everything.

With the massive power that the major labels had, we always saw artist/s as famous. We always thought that once an artist was signed to a label deal, they had it made. It was a big misconception.

Fame for an artist in most cases meant a large advance that had to be recouped by withholding royalty payments. That is why record label accounting gets messy and it cannot be trusted.

So in 2013, things have changed dramatically. With this change, the power is still with the major record labels. They gathered enough power during the Eighties and Nineties to be a force to be reckoned. Then in the Two Thousands the massive mergers and takeovers happened, further enhancing the power of the record labels. Then in order to allow digital start-ups, the record labels did one of three things; charge high licensing fees or litigate the start-up to bankruptcy or negotiate a large ownership stake in the start-up.

So even though the internet has lowered the barriers of entry, without the money and power of the label behind the artists, there is a pretty good chance, the artist would probably go unnoticed. Remember 4 million songs haven’t even been listened too on Spotify.

So when certain artists are complaining about a low royalty payment, maybe that is the royalty payment that is relevant to the niche the artist is in. Maybe it is a royalty payment that they have earned. You don’t see a current household name complaining. It’s because they worked hard at obtaining a certain thing called leverage.

Digital distribution offers an artist new audiences in places where brick-and-mortar stores would be impossible or unsustainable, like foreign countries or rural areas. The end result is growth across the board, both physical and digital provided that the artist gets noticed.

So is piracy that bad for an artist who is trying to get traction?

The majors and the mainstream journalists attached to news outlets operated by media moguls have done a great job selling the “one pirated item equals one lost sale” statistic and the “illegal downloading (piracy) is theft” argument. It is a statistic that rights holders, lobby groups and misguided artists exaggerate and it is a statistic they use to either kill off innovation or to stifle innovation.

Piracy (better known as copyright infringement) is basically one person (A) copying something of value that another person (B) owns. This leads to a situation that has both people (A and B) having a copy of the same item.

So it is safe to say that one pirated item is not theft. Theft is basically one person (A) taken something of value that another person (B) owns, which means that Person (B) no longer has the item.

So let’s assume that piracy spreads the artists’ material to places that are unknown to the artist and the people who download the music might become a fan and share their thoughts with others. They could even go to a show or they could go and purchase the next album or the artists back catalogue. There are a lot of could’s in the above theory. However the music business is all based on could’s.

For example, in the heyday of the record labels, this is how the above would have panned out.
Let’s assume that a record deal spreads the artists’ material to places that are unknown to the artist and the people who hear the music on radio or MTV might become a fan and share their thoughts with others. They could even go to a show or they could go and purchase the next album or the artists back catalogue. As you can see, the heyday theory also holds a lot of could’s.

Of course the difference is the money. The labels once upon a time threw money at artists and provided tour support. Today, the labels only go for the sure bet and 360 deals.

From a fan perspective, the main thing working against the artist today is time. Why would a music lover want to invest their time in an artist? I recently invested a lot of time in the TV show “Sons of Anarchy” because knowledge of the show was being shared at work and I wanted to be part of the conversation. I invested a lot of time in the show because fans of the show shared their thoughts with me. They convinced me that I needed to watch it.

One thing is certain in 2013. We move on fast. Look at the Top 10 lists of pirated movies that TorrentFreak publish each week. It’s always changing and very rare for the same movie to be at number one for two weeks in a row. Look at the Top 10 of the Charts published by each country. The artists in the list are always changing.

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