1. This story is really about eBay & their unclear reasons for yanking the listing. They work in mysterious ways so I think until there's more information about WHY, a lot of this discussion is just wasted bandwidth.
2. We offer a free download as part of every new LP we sell because we want to entice The Kids (tm) to buy the physical product. It's not a digital sale (they can go to iTunes, eMusic, wherever for that)- it's a free add-on to the package. The price of the LP isn't higher because of the download card.
If someone pulls a jerk move and sells the code, well, that sucks but it's only 1 download. It's unknown if the buyer would've bought the full-priced record anyway. Maybe they will after they hear the music.
But I agree completely with the philosophy of "if someone buys something, it's theirs." I buy used physical content all the time.
There shouldn't be a difference between selling 2nd hand physical media and 2nd hand digital media.
""Yes, some pirates are completely unwilling to give you money, ever. Ignore them.
The point of going after a pirate isn't to suddenly get them to pay, as much as to get them to stop poisoning your current paying customer pool by "teaching" them it's free. "
It's not worth the time at this point- I'm pretty sure that everyone on-line is aware that one can get content for free. (Don't get me wrong, I'm not saying do nothing- send take-down notices for illegal full d/ls etc- but the bulk of the efforts should be on the consumer side)
It's like Obama trying to get support for his policies from life-long Republicans- they're not going to support him no matter how many of their ideas he incorporates into his legislation (see: Obamacare's insurance mandate, which is literally a Republican plan that the Heritage Foundation came up with in 1989).
Concentrate on building loyalty, answering customer's needs, and making it just as easy to legally access content as it is to pirate it.
"These two stories should remind those of us in the US that our votes really do matter, and we have an election coming up in about six months. So don't waste your vote on someone who doesn't get it, and don't waste your vote on the "least bad" major candidate. Vote for someone who respresents your values, even if you have to write them in. That will really start scaring those politicians and their whole parties."
I think this is where I put forward the largest 3rd party in the US, the Green Party. We don't take corporate donations. http://gp.org/index.php
From the US GP platform:
"The Green Party opposes patenting or copyrighting life- forms, algorithms, DNA, colors or commonly-used words and phrases. We support broad interpretation and ultimate expansion of the Fair Use of copyrighted works. We support open source and copyleft models in order to promote the public interest and the spirit of copyright."
There's not much else about copyright, except discussion of software patents vs. software copyrights. The expected anti-monopoly, anti-corporation language permeates the platform too, as well as a call for clean elections, getting big $$ & $$ lobbyists out of politics, and the use of the public airwaves/broadcast spectrum for public benefit, not solely for private profit. It doesn't go into much detail about other issues that pop up here.
Sorry to inject a partisan note into this discussion, but since it was brought up I figure it's kosher. Carry on.
I am not a pirate, I am in favor of people paying for the art that they consume since that is my day job, and I FULLY back the statement below.
When Netflix doesn't have the movie I want because it was pulled due to an expired license, or it was never on Netflix because the licensor will not license it to the service, I try the library or my local video store (both of which, by the way, are one-sale situations for the licensor, instead of on-going ones like Netflix). After that, I give up and find something else to do with my time.
"Every movie they watch illicitly is a movie that, under different circumstances, they would have given you money for.
Yes, some pirates are completely unwilling to give you money, ever. Ignore them. Your efforts to punish them are futile because, even if you succeed, you will never see their money. They will feel no remorse, and will learn no "lesson".
The others are fertile ground, though. Just try to see what they want.
Are they pirating because you have decided to enact release windows based on geography? Don't do that.
Did they pirate because you waited too long to release your product to homes? Don't do that.
Are they pirates because you priced your product at it's weight in gold, when it's really just worth a watch? Don't do that."
This. I think "normal" people- i.e. people who don't read up on this stuff- are going to be shocked by this. When cameras and tape recorders and video cameras weren't in everyone's cell phone, it was a lot easier to "ban" recordings.
Now, artists just grin and bear it, and try to minimize the disruption of jerks with their flashes if it's appropriate. I know that I and my peers (even though we're "old") check out youtube videos of our favorite bands the morning after a show & post 'em on facebook, etc.
Imagine the word-of-mouth the IOC could get by embracing technology instead of trying to stuff the cell phone back into the rotary age.
Friends of mine have pulled their catalogs off of Spotify because the streaming income is so paltry.
I take the opposite tack- I want our catalog every legal outlet possible, regardless of the income stream. It'd be a betrayal of our due diligence to distribute our artists' work.
Of course, we're not 20th Century Fox.
I'm a Netflix customer but I've also kept my local brick & mortar video rental membership for just this reason. There are always really puzzling gaps in Netflix' offerings, and movies have "Watch By" dates because their licensing is expiring.
(Also, the selection really sucks once you get below the surface of various cult & specialized genres- I end up buying a fair amount of PAL & non-Region-1 DVDs from overseas because it's literally impossible to find the DVDs with extras etc, even via torrent, through domestic means)
It's astonishing how stupid really educated, experienced suits can be.
Yes, this seems more like an issue of a product licensed in one territory being sold in another territory where there is a different licensee.
Licensing in different territories happens all the time in music, but the only way to get in trouble is if a licensee (label or distributor) from territory A turns around and sends a ton of product to territory B, thereby flooding the market & taking away sales from the licensed label/distributor in that territory. But the key is that the violator is the licensee who sells directly to a forbidden territory.
It happens a fair amount, and when a licensor grants licenses to multiple countries in a tight area (think: Europe) this kind of stuff pops up more often.
Usually it's not cost-effective though- you see it in the higher prices that import records & cds get in record stores.
But if I read the post right, the initial sale from the licensee already happened in the licensee's territory. The importer is just reselling it, which should be kosher.
For a lot of the reasons above I've never made the jump to ebooks. I'd rather stick a paperback in my back pocket when I go out and risk losing it sometime during the night than risk losing/breaking a few hundred bucks of technology.
Interesting way to look at these topics- but big picture posts shouldn't ignore the fact that a fair amount of the world (& a sizable % of the US population) isn't on-line or has a smart phone, or their on-line access is very limited. Are these people just not worth discussing? Seems like if anyone out there is going to be swayed by big $ campaigns, it'll be the folks with little/no internet access.
Sorry, I should've been more specific- the parts of the DMCA that relate to terrestrial and on-line radio. The whole royalty process through the Librarian of Congress, the machinations of the National Association of Broadcasters, the shameful collaboration of the Corporation for Public Broadcasting, etc. Those "representatives" of radio almost deep-sixed their tiny non-commercial relatives at the behest of the RIAA.
AT uses DMCA take-down notices for blogs that post full-albums of our artists. If it's clearly a fan blog we usually contact them beforehand- especially for the KBD/super-obscure reissues. We say, "Hey, thanks for keeping this band's music alive, we've just released a great sounding version of this and other songs by this band and the band is getting royalties. Please replace the d/l link with a link to their record on our website." It works 95% of the time.
This is just my personal take on things, not the label's. (We don't have an official stance)
Some equally independent-minded labels are very much in favor of things *like* SOPA, though I don't know anyone who's pro-DMCA who understands how it's being manipulated by the RIAA. It's not a function of our size or audience at all, though you'd think it would be.
As for airplay, if this was 10 or more years ago, I'd answer that college & community stations were very important to getting our bands out there. Now, they're still important but a lot more air in the room is being taken up by web-based promotion. Commercial airplay has rarely even been an option.
So community radio airplay & word-of-mouth & touring have always been key for us. (Now a lot of that airplay is online)
Sound Exchange collects stray digital income and splits it 50/50 between band & label (that's the simplest explanation). One fascinating detail that flies in the face of its RIAA/Congressional origins is that the band/artist income CANNOT be paid to the label, no matter how much $ the band/artist owes the label- or how much the label CLAIMS the band/artist owes.
That's a huge deal, even though it hurts us a bit when a band who's legitimately in the hole to us for $2000 gets $500 that, if it were collected properly, we the label would apply to their $2000 debt. All we can do (and I do this) is ask the band nicely to pay us the $ to knock down their debt. But the fact that labels cannot talk their way into rightfully or wrongfully being paid their artists income is a big change.
Sound Exchange has astonished me with their good moves over the past year or so. Their "Artist Side" (the department that handles payment directly to bands) has been peppering me with requests for contact information for a host of bands whom we love but we had no idea anyone else did. I'm talking bands that were brief highlights of the underground who broke up in 1999 or 2003 or whatever. I've put them in touch with ex-band members and let them take it from there.
Sound Exchange is also readying a payment to our label. I have no idea how much it will be. The downside is that although we've been registered apparently for years, we were actually registered by an ex-business partner who has been collecting our share for a few years. Apparently SoundExchange will be paying us our back royalties and deducting the difference from the ex-business partner's other SoundExchange-registered companies. The resolution of this kerfluffle was quick on Sound Exchange's side & I appreciate that a lot!
As for the news covered by this post- I'm agnostic. Why would I want to chase after multiple sources of the same pool of digital income if I can get it all in one place? After all, this is $ that none of us previously knew existed. I think I'm not alone in thinking of this- wrongly, I know- as "free" money.
Wouldn't bands have to register w/ Sirius as well as with Sound Exchange? Judging from the pokiness of band members (myself included) that's not gonna happen & Sirius would be able to sit on the band side of the royalties until a band got its crap together enough to register through Sirius too.
Also, Sirius is only 1 digital source of Sound Exchange income. A savvy label/band would still need to be registered w/ Sound Exchange to get income from the other sources.
The one thing I don't agree with is the, "Let it all blow up!" approach. Look, someone out there charged customers money for songs, collected it, and now a portion of that $ is actually (gasp!) going to the bands & the labels who own or license those songs. To allow that someone who charged for songs to keep that $ without paying the bands/labels involved is just what Techdirt regulars complain about when overseas Performance Rights Organizations do- remember that article from last month about that?
I loved that movie (& I think it's referred to in the blog post above).
Well, "loved" as in got really pissed off. Then "loved" as in "I'm over 21 so I can watch whatever I want, even more so because I can order films from around the planet!"
Still, it shows the MPAA ratings system to be as broken and messed up as we all thought it is, and is a shining example of how NOT to run a ratings system.
We in the music industry faced that in the 80s w/ the PMRC. My employer, Jello Biafra, was knee-deep in the fight against them, along with Dee Snider & Frank Zappa. We fought and won the "Frankenchrist" trial in 1986-87.
Synch & masters, artistic & mechanicals, and digital income
A couple things- like some others here, I deal with these issues all the time. I have a semi-large quibble w/ this article although the thrust of it- big companies behaving badly- is clearly accurate.
From reading the more in-depth blog post that this references, it's unclear how much of this affects artists who have a label working their music, whether independent or major. I have a feeling that a lot of this doesn't apply to those artists. I think this is more about the literally independent artist, not artists on independent labels not represented by the RIAA.
For licensing games, movies, commercials, whatever, you *should* get both a synch right & a master right. I believe this is analogous to both artistic royalties & mechanical royalties. As I read those articles, the synch right and the mechanical royalty are analogous to both the public performance & reproduction rights that are discussed above, since they relate to the payment of mechanical royalties to songwriters.
HOWEVER, a company that wants to license a song is coming from OUTSIDE the artist-label relationship. A distributor or store (whether physical or digital) is from INSIDE the artist-label relationship.
That leads me to Quibble #1:
A song is distributed to a digital retailer by a distributor. That distributor able to do this because it has an agreement with a record label. The record label is able to do this because it has an agreement with the artist. This label-artist agreement is where the mechanical & artistic rights are assigned to the label. The label can then push the music out along the various sales channels. All of this is INSIDE the artist-label relationship. Additionally, because of the compulsory licensing under US law, there's only one digital license needed by digital retailers (a Reproduction license), and that's included within the artist-label relationship (implied or explicitly included, btw). If the other links in the chain are lined up, an artist cannot refuse a license for the US digital retailer to sell the work.
So digital retailers inside the US aren't involved at all in this story. Frankly, that's where the majority of income for US-based independent artists comes from, no matter who you are.
I understand the point that legally, for some reason, there's 2 licenses needed for overseas digital sales. And since only the Reproduction one is compulsory (i.e. an artist cannot refuse to allow a retailer to sell a track under this license), the OTHER one has to be agreed to by the artist. (Is this an example of legal overreach, like the DMCA, back when the internet was going to be printing money so it was okay to demand ridiculous fees from anything digital?)
Leaving aside that it makes no sense to have a 2nd license since this is NOT an OUTSIDE relationship (i.e. it's part of the sales chain that goes artist--> label--> distributor--> retail), I think Techdirt readers should step back and understand what this article is demanding.
It's demanding that all non-US digital stores (as opposed to physical stores) get explicit permission from each rights-holder to sell a product that they, if they were in the US, would automatically be able to sell by being associated with the artist's distributor. While in the world of data and numbers the trading of information and permission is lightning fast, here we're talking about my people. Artists. Band members. People who aren't computer-compatible. People who are on tour. People who aren't paying attention. Dollars to donuts says that's why the right to Reproduction is a compulsory license, ha ha ha...
That's crazy, but it's a small quibble.
Digital royalties famously don't come divided between mechanicals & artistic royalties. The linked article claims that standard practice is that when digital income comes in, it is all artistic royalties and the label pays the mechanicals out of its share. Maybe it's because we're not in the RIAA & we don't get their newsletters, but I've never heard of this, ha ha ha...
As is industry standard, digital sales are treated differently than physical sales. They're treated as licenses (hence the bits about compulsory licenses above) and therefore the standard is 50% label, 50% artist. I think it was Eminem who sued his label because they were treating digital sales as "sales", in otherwords paying him 10-14% instead of 50%. (His label has brass fucking balls to do that!)
We (& every other label I know of) split digital 50/50. The artist's 50% is split into artistic & mechanical if necessary (if a band is splitting everything equally & there are no covers, it's just extra work to split it into artistic & mechanical).
If we have to split the digital into mechanical & artistic, we have no real guide. As noted, there's no hard and fast % split. *** THIS ISN'T BECAUSE LABELS ARE EVIL!!! ****
This is because mechanicals are tied to a specific amount of money ($.091 cents/song) while artistic royalties are tied to a specific % of a sales price (either list price or wholesale price), and a record may have 5 songs ($.45 of mechanicals) & sell for $9.98, or it may have 10 songs ($.91/mechanicals) & sell for $9.98.
Here, we split each batch of digital royalties at the same ratio of the physical sales. So if the band is making 20% mechanicals & 80% artistic on their physical sales, then we apply the same ratio to their digital sales.
Are these overseas digital royalties part of what Sound Exchange is supposed to be vaccuuming up & distributing 50/50 to the label & to the artist? If so, Sound Exchange has been very active and refuses to pay labels any of the artist's income, even when the artist is legitimately in debt to the label. Trust me, we know this through direct experience. I'm both a band member and a label owner, so it's awesome and awful at the same time, but I don't begrudge the system too much because it has been tilted against the artist almost since day one.
For example, as an artist, I'm stoked because my old label (that's now almost bankrupt) can't come after my Sound Exchange income even though we left the label owing them $2K. As a label manager, I'm bummed because a band that owes us $4K is getting $500 that we could really use to pay down what they owe us. I have to (and am) talking w/ bands who owe us $ and trying to persuade them to pay down their debt with their Sound Exchange money. If they refuse, there's nothing we can do.
======= That said, I am appalled by the chicanery of the big boys, taking $ for artists that they don't represent and keeping it. They've tried to pull this kind of stuff in the late 1990s, even though they do not represent the majority of artists nor does their industry group, the RIAA, represent the majority of labels. Brass fucking balls.