Tag Archives: making money

Copyright, Music, My Stories, Piracy, Stupidity, Unsung Heroes

Royalties

What happens to the pool of money when more people start to adopt a streaming service?

You see, when more people are listening (either to ad-supported free or subscription services), more money is generated. The higher the amount of money generated, the better the payouts.

What did the music industry have before streaming?

They had the iTunes store and the record labels were still hoping that people would go back to buying CD’s. Otherwise, there was a lot of copyright infringement which led to $0 in income.

So in comes streaming via YouTube at the lowest entry point.

Free for the customer.

The aim of the service is easy. Get millions upon millions of people to use it.

Streaming is a disruptive technology. YouTube demonstrated this and in its early beginnings it didn’t care about copyrights at first. Remember back in 2007 when Viacom sued YouTube for $1 billion, because they claimed that YouTube was nothing more than a piracy site. Sort of like how the VCR was nothing but a piracy tool by the MPAA, or the MP3 player. Yet, all of these services, once they had a chance to grow proved to be a profitable tool for the entertainment industries.

So from YouTube, other streaming services enter the market. They all pay the record labels a license to have music on their service. Freemium was enabled to compete and kill off piracy.

Every stream (regardless if it’s on the free platform or the subscription platform) generates a royalty payment back to the labels. The more people who stream, the bigger the dollars going back to the record labels, copyright collection agencies and the publishers.

If freemium goes away, it doesn’t mean that people will start to pay again. Sort of like how people stopped to pay $18 for CD after Napster and in the process, killed off Tower Records and other brick and mortar shops.

The recording business side of music has already hit rock bottom.

Now the only way is up.

Recorded music revenues are increasing due to the monies coming in from streaming services.

Our move to an on demand culture means that streaming has won.

There will always be the 10% who will never pay for anything. But 90% would. Sometimes they will pay more, sometimes less, sometimes none.

And the artists complaining of getting screwed need to re-negotiate with their labels, who are using the artist catalogue as leverage to;

  • obtain high license fees from the streaming service
  • obtain a share/stake of the streaming service, so when it goes public the labels cash in
  • be paid the 70% royalties from the streaming service

So it’s no surprise that a Publishing company owned by a record label is up in arms over royalty payments that haven’t come to them.

Especially when the record label and publishing company in question, Victory Records are well-known for not paying artists their royalties. I am sure there are accounting issues with the royalty payment system and there are many reasons for that.

Did you know that a lot of money just goes missing in the music industry?

A report from Berklee College of Music estimates that 20 to 50 % of royalty payments get lost in transition and do not make it to the ones who created the songs. The same report puts a $45 billion value to the music industry. When you do the math, you realise that is a pretty big sum that just goes missing.

As the Fusion article states;
“Companies that stream music—like Spotify, Pandora or Apple—pay artists in exchange for playing their songs. Somewhere between the company cutting a check to cover the music and the artist— be they a performer, a songwriter, a sound engineer, or a producer— depositing money into a checking account, dollars are disappearing.”

It’s a well-known fact that the record labels are very creative when it comes to their accounting, and until the industry increases its transparency, there will always be misuse of royalties.

Which leads to stories like this?

In case you don’t want to click on the link, it is the story of James Blunt, who claimed via Twitter that he gets paid £00.0004499368 per stream (converted to dollars he’s getting $0.0006968992 per stream). If it relates to Spotify streams only, then the final payment that Blunt is finally getting is pretty low and is further evidence of the record label and collection agencies skimming a lot from the initial payment.

And if you think you can’t make money from streaming, then read this article.

And where does all of this leave the music fan, cranky as hell as they hear over and over again how they need to pay for music, when in fact we overpay for concert tickets and merchandise. A successful act today is making more dollars than they’ve ever made, however it is less from recordings. And we are looking for ease of use first and foremost. That’s how Spotify killed P2P to begin with, through convenience. And convenience is going to generate a lot of money for the recording industry. Let’s hope they put that money back to the people who deserve it, the creators.

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

Attention, Affluence, Dominance and The Artist Is Somewhere There In Between. BUT WHY.

It irks me when a person that you are having an email conversation with CC’s in other people who really don’t need to be CC’d. Instead of coming back to the person they are originally communicating with on the email they reply back and CC a few more extra people in. It is like they are broadcasting something to someone. Maybe they want to CC in a Manager to show how great they are and how terrible I am. Maybe they just want to make me look bad. I do it as well however when I do CC in an extra person I tell the person that I am responding to why I am CC in that extra person in. I also tell the person that I is CC’d in why they are included with a question that seeks their point of view.

Maybe we all just want some attention. It seems we are all fighting for attention these days.

Guess how many people know who Kim Dotcom is?

According to the MPAA and the RIAA, he is the greatest money launderer the world has ever seen. They convinced the police force to send their SWAT teams to break down his door and arrest him in the early hours. And the funny thing is that he is virtually unknown to ordinary people. Even his companies MegaUpload and Mega are not known brands to a large portion of people. So how can this great criminal mastermind remain undetected to most ordinary people. Hell, I was in Eastern Europe and all the people who I spoke to didn’t even know who Kim Dotcom was.

This goes to show how the entertainment industries like the MPAA and the RIAA have used affluence to hijack proper due process in the courts. And that affluence doesn’t stop there. It is used to hijack many debates especially when it comes to legislation around copyright. It is unfortunate that the music industry as a whole seems to be interested in protecting their business models, dominance and control.

The biggest issue today is attention.

The record labels still believe that their affluence and their publicity campaigns will get people’s attention. But that is old school thinking. Real attention grows over time.

And attention is just part of the equation.

How do we compensate the artist themselves or the songwriters that wrote the song once they have received our attention. The Copyrights of the artists are held by the labels. The labels purchase these copyrights for a value that is far less than what they are worth. And that is a big problem between artist and label. Because the record label is using the copyrights that they have amassed over 80 years of dominance as bargaining chips in licensing deals.

Spotify pays the labels a license so that Spotify can have their music on the service. In addition Spotify also pays the labels when songs are streamed. Plus Spotify pays any profits it makes to its part owners. In the case of the US market, Spotify is partly owned by the labels. And all of this was possible because the labels amassed an arsenal of songs from the artists they signed. Did the artists receive any compensation in these corporate deals?

The environment that musicians operate in is changing all the time, and with that comes a requirement to be flexible and forward-thinking in their approach. In addition the expectations of musical fans about how they access music and how they wish to be serviced has changed dramatically over the past fifteen years. And the ones that are investing in innovation are the technological companies. The Record Labels did nothing except litigate. The artists just waited to see what transpired instead of thinking and planning their own innovation.

If you want to grow and prosper as an artist you need to be thinking ahead all the time. Not only do you need to keep pace with your fans’ expectations, but you also need to position yourself to identify and make the most of the opportunities when they arise.

Focus on “WHY” you create music rather than simply focusing on ‘WHAT’ music you deliver. This is an important message. The why is the message that your fans would connect with and follow. It is your vision. Your belief.

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A to Z of Making It, Music, My Stories, Unsung Heroes

Music Is A Game of Lifers

Look at any artist or band you like and you will notice one important element. They are lifers in the music business. They are the people who have had million dollar highs. They are the people who have had million dollar super lows and losses. They are the same people who have reclaimed those million dollar highs only to see hard times come again. They are the same people who just keep on going, eventually achieving those highs again.

Dee Snider went through a long and drawn-out bankruptcy proceeding after Twisted Sister imploded. This is his big low from the platinum highs of “Stay Hungry” three years earlier. After bankruptcy he was free to make a new record and re-negotiate publishing deals.

The next high came when he signed a high pay deal with Elektra Records for the project that would become Desperado.

The next low started when Dee got that call that Elektra Records had dropped Desperado and shelved the album. That kicked off a process of more lows. Elektra didn’t just drop Desperado, they also prevented Dee from recording for any other label. Basically a record label that claims they are here to protect artists was destroying the career and personal finances of Dee Snider. Dee Snider is a SMF, so he just kept on going, trying to get out the rights to his songs returned to him. He kept on going trying to get the right to license the Desperado record to another label for a fair price. In the end, the only thing that Elektra Records would accept was full reimbursement of the money they’d laid out for the deal—$500,000, or $50,000 per song.

But, but, the record labels are here to protect their artists.

But, but, the record labels are here to negotiate longer copyright terms that will last on average over 120 years because that is the only way they can protect their artists.

The truth is, the record labels are there to make money from the lifers in the music business. It’s that simple.

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

The Winners In Music are always the Gamblers

REFORMS and CHANGES present challenges for every business. So why should it be any different for the Music and Entertainment Business?

AMC is a large power player in TV at the moment. So if they employ the Record Label business model, AMC should now scream piracy and get different laws passed to help protect their past incomes.

However they are not doing that? AMC recently announced that two new pilots have been ordered in Galyntine (which looks like a competitor for Revolution) and Knifeman (set in 18th century London and telling a story about a genius who challenges the normality of society in his quest to discover.) On top of that they already have ordered pilots for Line of Sight, Preacher, Raiders, The Terror, an Untitled The Walking Dead Spin-off and White City. Add to this list shows that passed the pilot stage and are in the scripted stage, with debuts set for 2014 like Better Call Saul, Halt & Catch Fire, Turn and King Of Arms.

That is a lot of gambles they are taking in order to remain relevant. Are the record labels doing that? Are artists doing that?

Then you have Netflix. Netflix is an innovator when it comes to movies. They provide a service to fans that the actual movie studios refused to provide.

Recently they branched out in original programming. House Of Cards was a success. Not just the show, but the way Netflix released it. This is the “all at once/binge viewing” model. This is what fans want today instead of the old school weekly episodes model.

So it was only a matter of time before other players came knocking on Netflix’s door. And that was Marvel.

Marvel will produce five shows for the platform, one each about heroes Daredevil, Jessica Jones, Luke Cage (formerly known as Power Man) and Iron Fist. The four individual superhero shows will then merge into a fifth show called The Defenders where the four heroes work together as a team. If these shows prove to be popular, no one knows, however it is a risk that a lot of people are taking.

The above demonstrates that entertainment is all about the new. If artists are not investing in their future, they might as well scream piracy or move into another career.

In business, you need to adjust your way of doing things to suit the reforms, otherwise you will go out of business. So why is it that in the Entertainment business, the major players need laws to be re-written, they need people prosecuted, they need websites taken down, they need the police to act on evidence provided by the Lobby Groups and they just scream and complain about everything else.

Music was always a risk game. The great success stories in the music business always came from left field. Even now, if you look at the great mainstream success stories recently, no one predicted Adele to sell over 10 million albums of her “21” album and she did that with her album available for free on all the illegal downloading sites.

No one expected an unknown New Zealand singer Lorde to out sell “the superstars – backed by a huge marketing budget” like Katy Perry, Lady Gaga and Miley Cyrus. Of course, she got a big boost by Sean Parker, who added her song “Royals” to his Hipster Spotify list, which has over 800,000 followers.

Money spent building up and marketing an artist doesn’t always make money. What the label or the A&R rep believes in doesn’t always equate to what the fans of music believe in.

No one predicted that the self-produced and financed Five Finger Death Punch debut album would be certified GOLD in the US, three years after its release. “The Way Of The Fist” was released and distributed via Finnish record label Spinefarm in Europe and in America it was distributed via artist and talent management company The Firm. They didn’t even have a major label behind them.

The album came out on July 31, 2007 in the U.S, selling only 5,400 copies in its first week and debuting at No. 199 on the Billboard 200 chart. In relation to charting, its highest position was No. 107 on the Billboard 200 chart. However, the album just kept on selling on a weekly basis and it was certified gold by the R.I.A.A for selling in excess of 500,000 copies as of April 1, 2010. Don’t be surprised if the album is certified platinum by 2015.

There is plenty of money to be made if the artist is good and if the artist is in a position to take it. If the music is poor, then it is no one’s fault except the artist.

No one has a guarantee that they will make it in the music business. No one is entitled to make it in the music business.

That is what art is all about. Entertainment is not a safety net. It is always about the new. If artists can get by in music, good luck. If they can’t, then they need to write better songs. No one cares if family and friends like the song.

In Australia, we have a shortfall of skilled fitters and machinists. We are even importing them from overseas. However to be musicians, the queues stretch across city blocks when X Factor, Voice, Idol and Got Talent shows hit town.

Today there is a new generation of artist that have grown up with the “everyone gets a trophy” paradigm regardless of how good they are. So you have a new generation cruising on sub-standard effort. It is those artists that didn’t play in the local soccer team that end up succeeding.

In my opinion, the music business began to decline when the label executives tried to become as famous as the artists. That is when the labels stopped caring about music and started caring about the Forbes Top 100 and profits. That was when reforms, innovation and changes went out the window, to be replaced by maintaining the profits that came.

In relation to profits, if artists are not making any money from music, what that means is that they are basically not good enough at the moment to capitalise. This applies to artists starting off, to artists paying their dues and to artists who were once successful. Artists need to realise that they are not entitled to people’s attention today based on past victories.

Look at your local sporting franchise. When they start losing, they struggle to fill stadiums, however when they are winning, no one can get a ticket.

In relation to music, I love Metallica, however everything they have done since the Black album has been worth a listen, but that’s it. There is no desire to go back and give it multiple spins. To prove my point, go and name the full track list of Reload without Googling it. However, they have taken gambles. St Anger was a gamble, the symphony concert was a gamble, the LULU project was a gamble and the 3D movie was a gamble. Some pay off and some don’t.

YouTube and Spotify allow us to sample and move on. If it is great, we stick around. But the music industry complains.

The truck drivers that transport CD’s are out of work, the people who work at the CD manufacturing warehouses are out of a job, the $2000 a day recording studios are out of business because people can record at home. Finally, you have the recording industry propping up the large record stores like HMV.

It’s not like anyone wants to go back to the days when we paid twenty dollars to buy an album, just to get home and find out it’s terrible. It’s not like we want to go back to the days of not being able to afford the great records that we couldn’t hear because we outlaid our money on duds the week before.

If the music is that good, the fans will come out to seek it and when we do, the artist needs to be in a position that they can capitalise on it as there’s plenty of money to be made.

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A to Z of Making It, Copyright, Derivative Works, Influenced, Music, My Stories, Piracy, Stupidity

Quality Equals Success and Those Doomsday Scenarios From Misguided Artist

Remember a time when people used to fear Doomsday. Back then Doomsday was the end of the world through some act of nature or nuclear warfare. These days Doomsday has gone all up market.

Doomsday now has a three piece suit and it is a trader on Wall Street. Each week, there is a new poll that states, “Doomsday; 98% risk of 2014 stock market crash”. “Doomsday; Critical Warning as 2013 shocker looms”. This is how far we are gone as a race. Our whole doomsday scenarios now revolve around the loss of money. Our priorities revolve around wealth and the accumulation of it.

I remember back in June 2011, Chris Clancy the vocalist of Mutiny Within, posted on his Facebook page (which was then removed) about the labels not making any money from music sales, so they take from the band’s income and after four years of working almost every day, he had only earned $100 in all of that time. There was also a rant about illegal downloads and how the band was dropped from Roadrunner because they sold less than 10,000 legal sales in the US and that their album had been illegally downloaded more than 60,000 times. It is that same argument you get from ignorant musicians, that their music is stolen because the label didn’t make any money of it.

So what does Doomsday and Chris Clancy from Mutiny Within have in common. Clancy’s priorities revolve around wealth and the accumulation of it. So when he got signed by Roadrunner, he must have thought he made it. The cold hard reality is, if he wanted to be paid millions, he should have gotten into banking. Even then, not all the people that get into banking get to make millions. That is life. Some win, some lose, others just do enough to get by. Making money is not the be all and end all.

Quality = Success

I listened to both albums that Mutiny Within did, the one under the Roadrunner umbrella, and the second one, under their own umbrella. In my view, Heartist and Mutiny Within sound very similar. So why does one band have more traction than the other.

THE BUZZ

Heartist took as much time as they could to build up an online buzz for themselves before they played any shows. So Heartist end up playing their first show and Roadrunner was there along with a few other labels. Mutiny Within didn’t build up an online buzz. They did it the old way, by building up a local scene buzz, which then got the label interested. Heartist went cyber world-wide with their buzz. They did it the new way, connecting with fans and letting the fans spread the word. That is why Heartist are touring everywhere and Mutiny Within are not. That is why the Heartist EP has sold a lot of copies, even while it is still downloaded illegally. Mutiny Within when they got signed only had a buzz in their local market.

DO IT YOURSELF

Heartist did it themselves. They kept on writing and creating, on their own time schedules and own budgets. The first Mutiny Within record was a Roadrunner financed record. Heartist was all DIY.

LETTING THE MUSIC TAKE SHAPE (without thinking it will sell)

All artists and songwriters come from a variety of music backgrounds. If you write and allow those backgrounds to come to the fore, each song will end up being different and unique. Don’t stick to one song formula, just because it could generate a hit. Remember the real hits, the songs that last forever are the outliers, the rule breakers, the game changers.

Stop thinking about the RECORDING INDUSTRY and start thinking about the music

Here is a DOOMSDAY scenario for you: The record industry started to collapse when it lawyered up and went to war against technology, beginning with Napster.

So why are artists still playing to the rules set by the recording industry.

In Sweden, Spotify is the king and the queen. Digital sales (downloads and streaming) accounts for 80 percent of music revenue in the territory and remember Sweden is the original home of The Pirate Bay.

Remember quality equals success.

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Copyright, Music, My Stories

Words of Wisdom from Chris DeGarmo

Chris DeGarmo always interviewed well. At times he was cautious with his words and no matter how hard the interviewer tried to get him to slip up, he always put up a front of unity within the band.

DeGarmo (in 1994 doing interviews for the Promised Land record)

“I like to think of our song writing as people that soak in life and turn around and express it through our music. You have to take time to absorb life to be able to let it breath through your work. You can just hammer out music like you do boxes of soap but I can’t do it that way.”

(The Crossroad’s Edge… Chris Degarmo AOL Interview, http://personalpages.tds.net/~dreemland/tce/chrisint.html)

Chris is talking about his song writing, however he frames the answer in the context of the band, so that if the band members read it, they will be pleased. It is our song writing and our music and then right at the end he contradicts himself, by saying I.

Artists that create songs from their experiences end up having a career. These artists are the anomalies, the paradigm shifters. Look at artists like Dee Snider, Nikki Sixx, James Hetfield, Brent Smith, etc.. They all write about their experiences. What they have experienced, someone else has experienced. Straight away a connection is made. That is why We’re Not Gonna Take It connected and Hot Love didn’t. Both are great songs, however We’re Not Gonna Take It is about as real as you can get, where as Hot Love is about a fantasy relationship.

Queensryche connected with people on Mindcrime, because they had a good story accompanied by great music and melody. People always love a good story. That is why we read books and watch TV shows and movies.

Copycat artists fail. When Guns N Roses came out in 1987, a million other artists came out with a similar look and sound. Even bands that where around changed their styles to suit the GNR sound.

Does anyone remember bands like Skin N Bones, Junkyard, Love/Hate, Shotgun Messiah, Spread Eagle, LA Guns, Danger Danger, Tangier, Faster Pussycat and Saigon Kick? I do and that is because I have all of their albums.

Artists that sing songs written by committees, will have instant fame. There is no doubt about that. This is the corporatisation part of the music industry. The labels that control the charts want that to happen. The label business is all about making money today. The labels are not interested in building a career for their artist. The mainstream press will see these artists as champions. However it doesn’t last. People these days can see that there is no substance and integrity to what they are doing. Everyone that hangs around to be with the star of the moment will abandon them.

Artists that write songs with the thought of being paid straight away will never achieve anything. Creating music is never a dollar driven game. The below quote from DeGarmo sums it up.

DeGarmo (in 1990 on life after Mindcrime and before Empire came out);

“It starts dawning on you that this can actually be lucrative, which is something that has escaped us for so long”.

(Guitar World – Nov 1990)

This is around the time that Empire came out. They have been at it for nine years. Creating albums and touring. The fantasy put out there by the press, is that these artists are loaded. However that is so far from the truth. The record labels are loaded. They make all the money from the sales of recorded music. That is why the RIAA is shaking down sharers and trying to get legislation passed to bring back the glory days. Real artists, that are in the game to create music, remain silent. They just go about their life, creating and building connections and trying to force another paradigm shift.

DeGarmo (in 1997 – doing press for Hear In The Now Frontier and asked about the writing process)

As a songwriter, I think you have to be true to yourself first, and I think we’ve done that, and by doing that, we’ve been able to find other people who are interested in what it is we do, as opposed to at some point changing the strategy all of a sudden and creating albums based on what we think other people think we should do. That gets you into this terrible house of mirrors, and you can’t find your way back.

(Scream.org – Dan Birchall)

DeGarmo sums up my point of view. The reason why the fans came to Queensryche is because they remained true to themselves as artists. By doing that, they found other people (fans) that connected with them. We love a good old story. These days even reality TV shows have scriptwriters. So when a song tells a story, it is magic. When an album tells a story, it is priceless. Operation Mindcrime (the album) told a story. Empire had songs that told stories. Promised Land had songs that told stories and it had a theme of disconnection running through it.

No one should create an album just to please the label bosses. It always ends bad.

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