Tag Archives: payments

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

Entertainment Industries Innovation V4.0 – When Will “Smoke On The Water” enter the Public Domain?

As a fan of music and the public domain it’s hard to understand why longer copyright durations are requested from the Corporations that control/hold the majority of copyrights. The majority of the music that I like was under copyright when I was born and by the time I die, it will still be under copyright. So how is that benefiting the creator in creating more works (who will be long gone) and the public who are meant to build off previous works because that is how culture thrives.

Remember, copyright was designed to give the creator a monopoly on their works for a certain period of time so that the creator can monetize their work, which in turn provides an incentive to create further works.

So without really realising it, we (the public) have a copyright law that more or less lasts a lifetime.

Let’s use “Smoke On The Water” as an example. It was released in 1972. Copyright on the work is meant to last the lifetime of the songwriters plus 70 years. The male life expectancy is 80 years. The songwriters listed for “Smoke On The Water” are Richie Blackmore, Ian Gillan, Ian Paice, Roger Glover and Jon Lord (RIP).

Let’s start with Jon Lord. Due to his death in 2012, his copyright in the song will expire in 2082. However the song will still remain under copyright due to the later deaths of the other members.

Let’s assume that all of the members live to the life expectancy age of 80 years old. That would mean Richie Blackmore, Ian Gillan and Roger Glover would have an end date of 2025. Add another 70 years to that and the copyright that they hold in the song would expire in 2095. However at this point in time the song is still under copyright.

Ian Paice is born in 1948, therefore his life expectancy end date would be 2028. Add another seventy years to that and the copyright monopoly held by the corporations on “Smoke On The Water” will finally expire in 2098, 126 years after the song was released. That is when, the public (provided that no more retroactive extensions are added) are allowed to use the song to build other works and derivative versions.

So the next time a copyright maximalist insists that copyright has an expiry date, tell them they are full of it. Copyright in reality has no expiry date during our life time. Remember in the US, the “Copyright Term Extension Act” extended the copyright of old works that should have been in the Public Domain to 2019.

And guess what the copyright corporations are gearing up for?

Yep, you guessed it. They are gearing up for another secret lobby/bribery effort to extend it. Using PIRACY as their weapon of choice, the lobby groups are pushing hard for the Government to step in and protect their business models.

Maybe they should focus on paying their artists accurately and properly. A story over at Hollywood Reporter, mentions about how Sony Music Entertainment is getting sued by the music company “Thursday by 19 Recordings” for royalties not paid, to the tune of $10 million. The interesting part of the case is how the record labels treat streaming payments.

The lawsuit is making the claim that streaming payments to the artists need to be classified as licensed works and not as sold works. The difference between royalty payments for licensed works and sold works is huge.

On what about this for a piece of innovation from the entertainment industries. Poor old LeaseWeb, the web hosting provider. One if it’s clients was Megaupload.com. As we all know, Megaupload was taken down in an Osama Bin Laden style raid in a classic example of overreach by the entertainment industries. The law enforcement bodies took action on this case based on evidence provided/lobbied by the Entertainment Industries namely the MPAA. Anyway, fast forward to 2014 and LeaseWeb is now being sued for allowing the hosting of websites that infringed on copyrights. While we are at it, let’s sue the car manufacturers for allowing us to infringe on the speed limits.

In Australia, the Attorney General, George Brandis wants the ISP’s to outlay money and carry the burden of protecting the business models of the entertainment industries. How about the entertainment industries releasing content on time and at a reasonable price. Graduated response schemes haven’t worked in France, the US and New Zealand, so let’s keep on pushing for them.

And to make this story even more interesting, the lobby group that is pushing for this three strikes rule has donated close to AU$4 million to the Liberal and Labor parties since 1998.

The Australian Screen Association (ASA), formerly known as the Australian Federation Against Copyright Theft (AFACT) who is well-known for the triple knockdown they received from iiNet in the courts. So of course, since the 2012 ruling, ASA has lobbied the government hard for a graduated response scheme. ZDNet did a great piece on this around the donations.

Keeping with the Australia theme, I just finished reading a story over at News.com.au about how Foxtel (the ONLY Pay TV provider in Australia) is planning on taking on the people who pirate “Game of Thrones” with a new cut-price plan. Before we get into the new cut price plan, it’s important to set the scenario.

Foxtel holds the exclusive rights to the “Game of Thrones” season 4 run in Australia. This means that the only legal way to watch the fourth series of “Game Of Thrones” in Australia is to pay for a subscription. Nice innovation.

Obviously this is an unpopular choice. No one wants to take out an expensive Pay TV subscription just for a TV show that has a 10 week run. Foxtel has another package called Foxtel Play, which is pay TV over the internet.

So Foxtel is saying to people, hey, if you have a Foxtel Play account, which costs $25 a month for a package based on a genre and of course the movie genre/Showtime is not included in that package, however if you chuck in another $35 over three months, you can watch “Game Of Thrones” legally.

So in reality, that three month run is going to cost a fan of the show, $110 to watch Game of Thrones legally in Australia. That is $75 (from the $25 a month for a Foxtel Play package that will still continue after the shows run is over) plus the $35 for the Showtime channel.

Yep, that is typical innovation from the entertainment industries.

Or how about the comments from John Landgraf, CEO of FX Network and Rick Cotton, Senior Counsellor of IP protection at NBC Universal.

“The legal copy of a property that’s been placed online can then be pirated.”

Yep, much the same way a legal DVD and Blu-Ray can be copied. Much the same way a legal airing of the TV show can be copied. Much the same way a legal VHS cassette could be copied.

Yep, sounds like typical innovation from the entertainment industries to me. I also like the part how they are trumping up the stats that piracy websites make a whopping $4.4 million annually on ads. If that is the case, then why don’t the entertainment industries offer the same service as the piracy websites do and make that same money. That is one way to compete with free. The reason why they don’t do it, is that the licensing deals they have around the world is worth way more. A lot more.

The audience for entertainment products has changed. Napster changed everything. That happened almost 15 years ago. So why haven’t the entertainment industries given the audience what Napster did 15 years ago.

http://m.theaustralian.com.au/business/latest/brandis-mooted-piracy-crackdown-riles-up-isps/story-e6frg90f-1226831754567

http://www.news.com.au/entertainment/tv/game-on-foxtel-takes-on-game-of-thrones-pirates-with-new-cutprice-plan/story-e6frfmyi-1226835839975

http://www.zdnet.com/au/lobby-pushing-for-australian-piracy-crackdown-donates-millions-7000026421/

http://variety.com/2014/digital/news/nbc-universal-fx-chiefs-call-for-increased-anti-piracy-measures-1201111186/

http://www.vcpost.com/articles/21728/20140219/digital-citizens-alliance-report-shows-piracy-websites-also-make-a-whopping-4-4m-annually-on-ads.htm

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The War Between Streaming and Black Box Revenue – Will The Record Labels Kill The Streaming Star?

The public has voted. It prefers streaming. The war is over. Case Closed. Maybe not.

Spotify pays millions to copyright holders. Now unless the artist is a DIY artist who controls their own copyright, most of the copyright holders are the major labels. So if the major labels are getting the millions each year for the blanket license to access their catalogues, where is that money going.

There is a term doing the round, called “Black Box Revenue.” This is the name given to income that the record labels collect that cannot be directly tracked to the recordings of a specific artist.

To put it all into context, streaming services pay the labels and upfront fee to access their catalogues. In addition, they then pay the labels royalties for each stream.

In time, this streaming system will be challenged by artists, much the same way the mp3 sales system was challenged by Eminem and other artists like Whitesnake, Rob Zombie and the band White Zombie.

In all of these cases, the artists said that their record label violated their contracts by counting a digital download as a sale instead of a licensing. Most artists get a royalty of 10 percent for the sale of a CD, minus a lot of deductions, while licenses pay a royalty of 50 percent and in most cases are not subject to any deductions.

When the same thing happens to the labels streaming revenue, the long-term viability of streaming services will be less than certain.

The main part of streaming that the critics and the record labels fail to understand is that it is a tool that is in place now, to PROVIDE REVENUE STREAMS later.

Of course the record labels and the executives in charge are all about the NOW, and a lot of their label rosters are designed for the NOW, so they don’t have time to allow things to grow. Spotify is growing in users, however the company still hasn’t made a profit after so many years in operation. The streaming system employed by the record labels that I mentioned above doesn’t allow it to make a profit.

Spotify wants to reduce piracy to ZERO. At the moment the critics of Spotify like Thom Yorke are complaining that it simply doesn’t pay enough. The truth is, creators have always been ripped off. However, if a song is great and it gets some traction, expect it to pay well.

Daft Punk passed 100 million downloads. The $700,000 that comes with that in streaming payments is enough for a band to live off, however artists see very little of the dollars paid to the record labels for the right to stream their content.

However with YouTube dominating in music, why do people need Spotify? Actually, Thom Yorke has no issues with YouTube, an unofficial streaming platform which is interesting. So I am thinking that Thom Yorke’s issue is with the record labels stake in Spotify.

Personally, I am quite content to listen to three songs on Spotify and get an ad break. I have no interest in paying for a package even if Spotify caps the limit of free songs I can listen to in a month. I will just move to YouTube when that happens, or to my iTunes library or to my physical collection of LP’s and CD’s.

What about the songwriters who write the songs? How do they get paid in the streaming age. It’s simple. They get paid, the same way everyone else gets paid that provides a service. Songwriters need to stop being greedy. What they need to do is hand in the song, get paid the agreed monies and off they go, writing more songs for artists. If a songwriter gets paid $1000 for each song they hand in, then they know they need to write 50 songs in order to earn $50,000. If one of the songs gets traction and gets 100 million streams, the songwriters should be using that as a piece of promotion and up their song writing fee. It’s simple business practices.

It is a revolution that we are experiencing.

Musicians can still make a living. Is it harder now compared to the past? My answer is NO. Musicians always had to work hard to get somewhere, that part hasn’t changed and it will never change.

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Spotify – Will Rock and Metal bands reach a 100 million downloads in such a short time frame?

Daft Punk’s track Get Lucky has been streamed 104,233,480 times so far. Spotify generally pays 0.004 a stream to the rights holder. So by doing the math that comes to $416,933.92 in payments from Spotify to the rights holder. How much of this money is distributed is given down to Daft Punk from Columbia Records is unknown. For a song that was released in April, this has proven to be a pretty good earner.

YouTube also shows Get Lucky getting close to 112 million plays. What YouTube will end up paying for that is unknown, as the payout figure is calculated on the type of advertisements shown.

To me, the Spotify and YouTube stats prove that if a song makes a connection with people, people will be going back to the song over and over and over again. As an artist, this is the statistic you want reported to you as you know that people are playing your song or songs.

In relation to sales they come a distant last, however just to make this post complete, Get Lucky has been downloaded over 2.4 million times in the US and over 1 million times in the UK. This means that the song in combined sales (US + UK) has earned roughly $2.4 million (that is based on using the iTunes 0.7 formula).

So if your view of the recording business is that “I WANT TO BE PAID RIGHT NOW” then the sales figure is your brass ring. However, in time the sales figure will die down.

If your view of the recording business is that “I WANT PEOPLE TO PLAY MY SONGS FOREVER and BE PAID FOREVER” then the streaming figure is your brass ring. Streaming has taken the concept of listening to a song a million times at home on your stereo into the digital world.

For all the complaints about streaming payments, an important note to make is that there is NO RELIABLE data from the PRE-NAPSTER era, that suggests that musicians received more money from recorded sales. The good old ADVANCE from the Record Labels always clouded the creative accounting employed by them.

Sound recordings these days are purely for promotion purposes. If you can make money from it, like Daft Punk has, great. In the end, once artists start looking for sales of their recorded music they start to become entrepreneurs. An entrepreneur is an individual who organizes and operates a business, taking on the financial risk to do so. As an entrepreneur you have to offer something which somebody else wants to buy. If you want to make money you need to provide something of value that somebody else wants to pay for.

In relation to radio plays, yes terrestrial radio does pay more, however with the rise of internet connections in all new automobile’s, terrestrial radio is dead. They just don’t know it yet. The world has shifted online and with all things online there is always one winner that comes out on top. Google, Facebook, Amazon, iTunes and Twitter are just some names that come to mind.

So what are the rock/metal numbers like for new music that came out in April 2013.

Bring Me The Horizon is sitting at 3.2 million for the song Shadow Moses.

Paramore is sitting at 7.6 million for the song Still Into You.

Fall Out Boy is sitting at 20.1 million for the song My Songs Know What You Did In The Dark.

Killswitch Engage is sitting at 1.2 million for the song In Due Time.

Volbeat is sitting at 2.63 million for the song Lola Montez.

Device is sitting at 525,000 for the song Vilify.

Rob Zombie is sitting at 347,000 for the song Dead City Radio And The New Gods Of Supertown.

If it is a numbers game, metal and rock has a long way to go to get to the 100 million streams of Get Lucky. One thing is clear, online streaming will not slow down. If you are a DIY artist, you need to play in this field. Streaming is just one cog in the complex machine that the music business has become.

If one of the bands above had that crossover songs, then….

 

For some artists it works really well, for others not so well. In relation to sales, Killswitch Engage, Rob Zombie, Volbeat and Device are still selling physical and digital units as they tour around the U.S. All of the bands have moved over 100,000 units each for their albums released in April.

If you are comparing sales numbers to streaming numbers, the streaming numbers are way more spectacular. In the end, all artists want to be heard. So what are are the artists doing, to give the people a reason to listen to them.  

The live business, the merchandise business and the recorded music sales business are other cogs in the complex machine that the musical business has become. 

One last note, Black Sabbath’s Paranoid has earned close to $44,000 from Spotify. Not bad for a song that was released forty odd years ago. Now who gets that money and how it is distributed amongst the band members is a different story entirely.

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