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<title>Techdirt. Stories filed under &quot;labels&quot;</title>
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<pubDate>Thu, 9 May 2013 10:59:00 PDT</pubDate>
<title>Streetlight Manifesto Can't Fulfill Pre-Orders Because Label Refuses To Give Them Their Own Records</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20130508/17221923011/streetlight-manifesto-cant-fulfill-pre-orders-because-label-refuses-to-give-them-their-own-records.shtml</link>
<guid>http://www.techdirt.com/articles/20130508/17221923011/streetlight-manifesto-cant-fulfill-pre-orders-because-label-refuses-to-give-them-their-own-records.shtml</guid>
<description><![CDATA[ A year ago, we wrote about how the band Streetlight Manifesto was urging people <a href="http://www.techdirt.com/articles/20120302/12571517965/band-tells-fans-to-boycott-its-albums-saying-its-label-doesnt-pay.shtml">to boycott</a> its own album, unless it was bought directly from the band, because their label, Victory Records, wasn't giving them any of the money.  Here's what they said at the time:
<blockquote><i>
We&#8217;re writing today to ask you to please boycott all Streetlight related items by not purchasing any of our records or merchandise from Victory&#8217;s website, any traditional CD stores, online third party retailers or any digital distribution service (iTunes, Amazon etc). Victory has a long-time reputation of pocketing all of the proceeds from a band&#8217;s music and merch, with shady accounting and generally bully-ish behavior. If you want to support Streetlight, our music and our ability to tour and continue to release music, please make all SM related purchases from our own webstore, The RISC Store (www.riscstore.com), or come out to a show and buy a shirt or cd from us directly. In regards to getting the music we make, you can buy directly from us, or, alternately, we&#8217;re sure you can find a way to get the tunes onto your computer that may not be, ahem, traditional&#8230; Speaking a Bit metaphorically, there is a Torrent of methods to accomplish this, and Google is your always loyal friend&#8230;
</i></blockquote>
Believe it or not, things have now gotten even worse.  <a href="http://www.techdirt.com/user/hotcod">Tim Griffiths</a> writes in to let us know that the band was preparing to launch its latest album, and had even been taking preorders for the album through its own store as mentioned above... but now they claim <a href="http://streetlightmanifesto.com/pre-orders-faq/" target="_blank">Victory won't even give them copies of their own album to sell</a>:
<blockquote><i>
Q: Why do I not have my record yet? I totally want it.
<br /><br />
A: Simple &#8211; Victory Records has refused to send us any of Streetlight&#8217;s new album. Without that &#8211; we can not send out pre-orders. Classy move. Read on for more information about your order.
</i></blockquote>
The issue is made more complex by the fact that the band's lead singer, Toh Kay, also released a <i>companion album</i> to the SM album, with a very similar name.  SM's new album is <i>The Hands That Thieve</i>, while Toh Kay's is <i>The Hand That Thieves</i>.  When Toh Kay put up a video from his album, Victory <a href="http://dyingscene.com/news/victory-records-claims-copyright-infringement-against-toh-kay-for-his-own-song/" target="_blank">claimed it infringed on <i>their</i> copyright</a> and had it taken down.
<blockquote><i>
Q: I wanted to hear the Toh Kay record. The music video &#8211; before Victory took it down &#8211; was beautiful and so was the song. My gosh. What happened?
<br /><br />
A: Victory had given Streetlight a choice: either completely kill the Toh Kay record (their absurd reasoning was that its sale would &#8220;cannibalize&#8221; Streetlight sales, ha!) or hand it over to them so they can release it and exclusively profit from it. Streetlight has experienced and documented years of Victory not paying royalties while continuously profiting from their music, so it was a no-brainer. We had to cancel the record, no matter how much we all loved it and how hard the guys worked on it. That music video, by the way, is also &#8220;illegal&#8221;. So if you saw it &#8211; your eyes are criminals.
</i></blockquote>
The band is offering to give back people's money, or figure out other ways to satisfy various orders.  As in the past, they've also suggested that alternative means to finding the album might be fans' best path:
<blockquote><i>
Q: The Streetlight record leaked online &#8211; I already ordered it through you &#8211; how should I feel inside about downloading it?
<br /><br />
A: We can&#8217;t tell you how or where to download it &#8211; but if you already paid for it, and it&#8217;s being withheld from you by the band&#8217;s own record label &#8211; well, take that how you will.
</i></blockquote>
And also, this:
<blockquote><i>
Q: This whole situation makes me hate the music industry and I now understand why it &#8211; as a business entity &#8211; is failing across the board.
<br /><br />
A: Yeah. I hear ya. I just downloaded Dredd 3D &#8211; wanna watch it with me?
</i></blockquote>
Remember stories like this the next time labels pretend that they represent the best interests of artists.<br /><br /><a href="http://www.techdirt.com/articles/20130508/17221923011/streetlight-manifesto-cant-fulfill-pre-orders-because-label-refuses-to-give-them-their-own-records.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20130508/17221923011/streetlight-manifesto-cant-fulfill-pre-orders-because-label-refuses-to-give-them-their-own-records.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20130508/17221923011/streetlight-manifesto-cant-fulfill-pre-orders-because-label-refuses-to-give-them-their-own-records.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>labels-represent-artists?</slash:department>
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<item>
<pubDate>Thu, 4 Apr 2013 13:10:54 PDT</pubDate>
<title>Macklemore Explains Why Not Being On A Label Helped Him Succeed</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/blog/casestudies/articles/20130401/03115322523/macklemore-explains-why-not-being-label-helped-him-succeed.shtml</link>
<guid>http://www.techdirt.com/blog/casestudies/articles/20130401/03115322523/macklemore-explains-why-not-being-label-helped-him-succeed.shtml</guid>
<description><![CDATA[ Unless you've been <i>totally</i> under a pop-culture/music rock for the past few months, you've probably heard of Macklemore and his <a href="http://www.youtube.com/watch?v=QK8mJJJvaes" target="_blank">hit song (and video) <i>Thrift Shop</i></a>.  Now at well over 200 million views, the song itself has been at the top of the charts and has sold over 4 million copies.  In case you somehow <i>have</i> missed it, or in case you just want to watch it again, here's the video:
<center>
<iframe width="560" height="315" src="http://www.youtube.com/embed/QK8mJJJvaes" frameborder="0" allowfullscreen></iframe>
</center>
The song itself was released last year, and built up a lot of buzz throughout the fall, but completely <i>exploded</i> at the beginning of this year.  While I became aware of the song a while back, I didn't realize until recently that Macklemore is actually yet another story of a totally independent artist who found success not by signing with a label and having them throw a ton of money into promoting him, but by carving his own independent path (and using YouTube to connect with fans).  In many ways, his story reminds me of <a href="http://www.techdirt.com/blog/casestudies/articles/20130324/01115322434/musician-alex-day-explains-how-he-beat-justin-timberlake-charts-basically-just-via-youtube.shtml">Alex Day's</a>.
<br /><br />
A few weeks ago, Macklemore <a href="http://www.nerdist.com/2013/03/nerdist-podcast-macklemore/" target="_blank">sat down with Chris Hardwick on the Nerdist podcast</a> and it's great.  Beyond some interesting discussions about sudden fame (and then doing laundry in the communal laundry room of your apartment building days after appearing on SNL), he does talk a little about being a successful musician without a label.  Chris asks him about the no label part and mentions what a great story it is:
<blockquote><i>
<b>Chris</b>: To see you and Ryan Lewis come out of Seattle just making stuff you like making, with no label, and oh you're at the top of the charts, and all these people are talking about the song... that's just a great story.
<br /><br />
<b>Macklemore</b>: Yeah, I appreciate it.  It is a very cool story.  It's what you always hope for in terms of picking the independent path.  It's cool to see that that's been a focal point.  It's not just "Thrift Shop"; it's this kind of do-it-yourself attitude behind the music we've made -- that is also within the midst of this thrift shop song.  That these two dudes chose to go independently, to turn down the labels.  That the music industry is changing.  That it's evolving.  And to be at any sort of place where we're at the forefront of that, at the moment, is exciting.
<br /><br />
<b>Chris</b>: It's so inspiring to so many young people who maybe -- and I think people are more and more used to the fact that they can just make stuff in their bedrooms and it can turn out to be huge.  But every time it happens, it's that much more inspiring to a younger generation of people who go... 'there's no excuse any more to not go out and make stuff that you want.'
<br /><br />
<b>Macklemore</b>: Absolutely.  And that's what we watched people that came before us that have done it independently, whether it's Sub Pop, or whether it's... Mac Miller did it independently.  And he had every major label hollering at him with huge seven figure offers and turned it down and still went number one on Billboard.  There's examples of it that came before us, that had us say 'I think that it can work -- I'm not sure that it can work."  But, at the end of the day, what's most important, and creative control is number one for Ryan and I.  It's a no brainer.
<br /><br />
<b>Chris</b> I'm sure you've been approached a million times at this point, but you still don't want the infrastructure of a label?
<br /><br />
<b>Macklemore</b>: Yeah, there's no reason to do it.  <b>With the power of the internet and with the real personal relationship that you can have via social media with your fans</b>... I mean everyone talks about MTV and the music industry, and how MTV doesn't play videos any more -- YouTube has obviously completely replaced that.  It doesn't matter that MTV doesn't play videos.  <b>It matters that we have YouTube and that has been our greatest resource in terms of connecting, having our identity, creating a brand, showing the world who we are via YouTube.  That has been our label</b>.  Labels will go in and spend a million dollar or hundreds of thousands of dollars and try to "brand" these artists and they have no idea how to do it.  There's no authenticity.  They're trying to follow a formula that's dead.  And Ryan and I, out of anything, that we're good at making music, but we're great at branding.  We're great at figuring out what our target audience is.  How we're going to reach them and how we're going to do that in a way that's real and true to who we are as people.  Because that's where the substance is.  That's where the people actually feel the real connection.
<br /><br />
And labels don't have that.
<br /><br />
So you sign up for a label.  There's not some magic button they're now going to push and it means that people are going to like who you are.  Or that they're identify with your vision or your songs.  It actually comes from sitting down, staring at a piece of paper for months or years on end, trying to figure out who you are as a person, and hoping that it comes through in the end.  But a label's not going to do that for you.
</i></blockquote>
Uh huh.  Once again, it makes you wonder what people are thinking when they claim that YouTube is putting artists <a href="http://www.techdirt.com/articles/20130220/03360022036/dead-kennedys-guitarist-joins-crusade-against-ad-networks-youtube-despite-understanding-neither.shtml">out of work</a>.
<br /><br />
The whole episode is worth listening to as Macklemore has a great perspective on all of this, and it's interesting to hear him discuss the oddity of his sudden increase in fame and how he's dealing with it, without letting it go to his head.  But considering how often we've had similar discussions about artists who choose to go independent, I thought some would enjoy that particular snippet especially.<br /><br /><a href="http://www.techdirt.com/blog/casestudies/articles/20130401/03115322523/macklemore-explains-why-not-being-label-helped-him-succeed.shtml">Permalink</a> | <a href="http://www.techdirt.com/blog/casestudies/articles/20130401/03115322523/macklemore-explains-why-not-being-label-helped-him-succeed.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/blog/casestudies/articles/20130401/03115322523/macklemore-explains-why-not-being-label-helped-him-succeed.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>looking-for-a-come-up</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20130401/03115322523</wfw:commentRss>
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<pubDate>Wed, 3 Oct 2012 08:42:22 PDT</pubDate>
<title>Band Gives Away Latest Album After Label Attempts To Shelve It Until 'Sometime Next Year'</title>
<dc:creator>Tim Cushing</dc:creator>
<link>http://www.techdirt.com/articles/20121001/19120320564/band-gives-away-latest-album-after-label-attempts-to-shelve-it-until-sometime-next-year.shtml</link>
<guid>http://www.techdirt.com/articles/20121001/19120320564/band-gives-away-latest-album-after-label-attempts-to-shelve-it-until-sometime-next-year.shtml</guid>
<description><![CDATA[ Well, if nothing else, you can't knock Death Grips' work ethic. After becoming an indie sensation with their critically-acclaimed 2011 debut, "<a href="http://en.wikipedia.org/wiki/Exmilitary" target="_blank">Exmilitary</a>" (still <a href="http://soundcloud.com/deathgrips/sets/death-grips-exmilitary/" target="_blank">available for free</a> on Soundcloud), Death Grips signed with Epic and released "<a href="http://pitchfork.com/reviews/albums/16512-death-grips-the-money-store/" target="_blank">The Money Store</a>" in April, 2012.<br />
<br />
Rather than rest on their newly-signed laurels, Death Grips announced that they would <a href="http://pitchfork.com/news/45557-death-grips-sign-to-epic-ready-two-2012-albums/" target="_blank">release <i>another</i> album in October</a>. And release it they did, only without Epic's involvement or blessing. The unofficial release of their third album began <a href="https://twitter.com/DeathGripz/status/252580271847784448" target="_blank">with this tweet</a>:
<br />
<blockquote class="twitter-tweet tw-align-center"><p>The label wouldn't confirm a release date for NO LOVE DEEP WEB "till next year sometime"</p>&mdash; Death Grips (@DeathGripz) <a href="https://twitter.com/DeathGripz/status/252580271847784448" data-datetime="2012-10-01T01:26:44+00:00">October 1, 2012</a></blockquote>
<script src="//platform.twitter.com/widgets.js" charset="utf-8"></script>
<blockquote>
<i>"The label wouldn't confirm a release date for NO LOVE DEEP WEB 'till next year sometime'"</i>
</blockquote>
Death Grips was looking to put another album out in October and if Epic couldn't keep up with their release schedule, so be it. <a href="https://twitter.com/DeathGripz/status/252581175359594497" target="_blank">Another tweet followed</a>, implying that Epic itself hadn't even heard the new album yet:
<br /><blockquote class="twitter-tweet tw-align-center"><p>The label will be hearing the album for the first time with you</p>&mdash; Death Grips (@DeathGripz) <a href="https://twitter.com/DeathGripz/status/252581175359594497" data-datetime="2012-10-01T01:30:19+00:00">October 1, 2012</a></blockquote>
<script src="//platform.twitter.com/widgets.js" charset="utf-8"></script>
<blockquote>
<i>"The label will be hearing the album for the first time with you."</i>
</blockquote>
And away they went, dumping their brand new album into various file lockers and <a href="https://twitter.com/DeathGripz" target="_blank">tweeting the links</a> to every new upload and blog entry referring to their impromptu release party.
<br /><br />
We only have Death Grips' version of the events at this point, but it looks as though release date negotiations must have gone off the rails sometime on September 30th. A string of tweets paraphrasing a sample used on "Exmilitary's" first track, "<a href="http://soundcloud.com/deathgrips/death-grips-exmilitary-1" target="_blank">Beware</a>," set the stage:
<blockquote>
<i>He came to me with money in his hand<br />
He offered me I didn't ask him. I wasn't knockin someones door down. I was running from that.<br />
I looked at it and said this is a bigger jail that I just got out of.<br />
I run the underworld guy. I decide who does what and where they do it at.<br />
What am I gonna run around and act like I'm some teeny bopper somewhere for someone else's money?<br />
I ROLL THE NICKELS. THE GAME IS MINE. I DEAL THE CARDS.</i>
</blockquote>
About 12 hours after uploading NO LOVE DEEP WEB to their own site, it went down. Death Grips tweeted that Epic <a href="https://twitter.com/DeathGripz/status/252846770781057024" target="_blank">had shut down their website</a>. Epic has since <a href="http://pitchfork.com/news/48044-death-grips-say-their-label-shut-down-their-website/?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+PitchforkLatestNews+%28Pitchfork%3A+Latest+News%29" target="_blank">denied it had anything to do with the shutdown</a>. Currently, Death Grips' <a href="http://thirdworlds.net/" target="_blank">site is still down</a>. It's entirely possible that the sudden influx of traffic crashed it. There have been no updates on the site's status from Death Grips.
<br /><br />
That being said, there are a few reasons Epic might have delayed the release.
<br /><br />
1. <a href="http://www.techdirt.com/articles/20120501/07385618728/my-bloody-valentines-kevin-shields-reissue-delays-sony-hid-our-master-tapes.shtml" target="_blank">Major labels</a>&nbsp;like to <a href="http://www.techdirt.com/articles/20111202/02301416951/pro-artist-gatekeepers-continue-to-separate-artists-their-fans.shtml" target="_blank">shelve things</a>, sometimes indefinitely. This <a href="http://www.techdirt.com/blog/casestudies/articles/20120606/15440619227/fiona-apple-to-label-back-off-im-connecting-with-my-fans.shtml" target="_blank">seldom</a> makes <a href="http://www.techdirt.com/articles/20110624/10313514841/drake-tells-universal-music-to-stop-taking-down-music-hes-leaking.shtml" target="_blank">artists happy</a>, no matter the justification.
<br /><br />
2. The <a href="http://pitchfork-cdn.s3.amazonaws.com/content/nldw-1800.jpeg?wmode=transparent" target="_blank">album art </a>(definitely NSFW -- unless you're treating this person for erectile dysfunction or are <a href="http://www.reddit.com/r/IAmA/comments/106mnr/iama_overnight_clerksecurity_at_a_24_hour_adult/" target="_blank">This Guy</a>) was still under discussion.
<br /><br />
3. Epic wasn't happy with Death Grips <a href="http://www.techdirt.com/articles/20120928/23265120546/yes-there-are-many-many-many-many-legal-uses-bittorrent.shtml" target="_blank">topping the Bittorrent charts</a>, legal or no. Death Grips seems to be fine with it. They're still giving away their first album at Soundcloud (although you're more than welcome to purchase it). Possibly they were considering "alternate distribution" and Epic iced the album in order to talk some sense into them. Not that this plan worked...
<br /><br />
So, what have we learned? For starters, pissing off your artists in this day and age can have some serious repercussions, especially if you're in the business of collecting a chunk of every album sold. Windows are made to be broken. Buyer beware. Etc. Does this mean you should kowtow to every demand from your signed artists? No, but this does mean that setting release dates arbitrarily simply won't work anymore.
<br /><br />
You also might want to take a good look at the artist you're signing and ask yourself, "Is this a good fit for a major label?" Between the explicit album cover, the Bittorrent numbers, the abrasive, uncompromising musical style, the fact that their first album sounded "<a href="http://lostinthesound.com/2012/05/players-haters-in-the-house-weakling-spikes-the-mashup-punchbowl/" target="_blank">like it was recorded under someone's house with a webcam</a>" and the general volatility of the recording industry, maybe everyone involved should have realized it was never going to work out.<br /><br /><a href="http://www.techdirt.com/articles/20121001/19120320564/band-gives-away-latest-album-after-label-attempts-to-shelve-it-until-sometime-next-year.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20121001/19120320564/band-gives-away-latest-album-after-label-attempts-to-shelve-it-until-sometime-next-year.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20121001/19120320564/band-gives-away-latest-album-after-label-attempts-to-shelve-it-until-sometime-next-year.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>how-does-NOW-sound?</slash:department>
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</item>
<item>
<pubDate>Mon, 10 Sep 2012 12:36:00 PDT</pubDate>
<title>How The Major Labels Screw Artists: Jurisdiction &#038; Venue</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20120904/16501420272/how-major-labels-screw-artists-jurisdiction-venue.shtml</link>
<guid>http://www.techdirt.com/articles/20120904/16501420272/how-major-labels-screw-artists-jurisdiction-venue.shtml</guid>
<description><![CDATA[ Last year, entertainment lawyer Marty Frascogna made some waves by explaining the various hidden "gotchas" in major label contracts that could set up a situation where a band had sold over a million albums, but was <a href="http://www.techdirt.com/articles/20110707/03264014993/riaa-accounting-how-to-sell-1-million-albums-still-owe-500000.shtml">still in debt</a>.  A few months later, we had him <a href="http://www.techdirt.com/articles/20110816/17194815553/breaking-benjamin-dispute-lays-bare-dirty-laundry-behind-scenes-record-label-deals.shtml">analyze</a> an actual record label contract that had become public as evidence in a legal dispute (most of the time, those things are kept very, very secret).
<br /><br />
Marty's back with some new work, this time a video explaining some more of the little clauses that most musicians probably overlook in their contracts, but which allow the major labels to screw over artists.  Key terms this time around: <a href="http://musicglobalization.com/2012/08/28/watch-out-for-these-killers/" target="_blank">jurisdiction and venue</a>.  We've seen this in other arenas as well -- and lots of online service providers also uses these clauses in the terms of service you sign -- basically trying to force you to use a court that's convenient for the company, but not for you.
<center>
<iframe width="560" height="315" src="http://www.youtube.com/embed/bAxuo2P2At4" frameborder="0" allowfullscreen></iframe>
</center>
This is one of those clauses that most people just skip right over.  But, of course, it can make a big difference especially if -- as Frascogna uses in his example -- you're 3,000 miles away, and the label owes you lots of money.  It can be more expensive to actually get to the court in question than the money that's owed to you.  His suggestions are to push back and seek a jurisdiction and venue that's better for you, though he admits that's unlikely to happen.  I'm less convinced by the next two suggestions: mandatory mediation and binding arbitration.  Those are certainly cheaper than full on litigation, but there are details that matter there as well.  Various studies have shown that, at least with arbitration, the big companies win a ridiculous percentage of the time -- and it's often because (even if the arbitrator is agreed upon by both parties) the arbitrator is going to do a lot more business with the big company over time and wants to be on the "recommended" list.  So they have incentives to side with the company in order to "keep the business."
<br /><br />
Either way, it's good to see Frascogna back to revealing some of the "tricks of the trade" of the major labels in setting up a contract that is inherently biased against artists.<br /><br /><a href="http://www.techdirt.com/articles/20120904/16501420272/how-major-labels-screw-artists-jurisdiction-venue.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120904/16501420272/how-major-labels-screw-artists-jurisdiction-venue.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120904/16501420272/how-major-labels-screw-artists-jurisdiction-venue.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>letting-out-the-secrets</slash:department>
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<pubDate>Fri, 17 Aug 2012 16:07:39 PDT</pubDate>
<title>As Label Funds To RIAA Dry Up, Top Execs Still Make Over $1 Million</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20120817/15551120085/as-label-funds-to-riaa-dry-up-top-execs-still-make-over-1-million.shtml</link>
<guid>http://www.techdirt.com/articles/20120817/15551120085/as-label-funds-to-riaa-dry-up-top-execs-still-make-over-1-million.shtml</guid>
<description><![CDATA[ Just a few days ago, in mocking the MPAA/RIAA filing with the US's IP Enforcement Coordinator, we noted that they <a href="http://www.techdirt.com/articles/20120814/17392820054/is-being-rich-arrogant-against-law-riaa-mpaa-seem-to-think-so.shtml">mocked</a> Kim Dotcom as being arrogant and wealthy, but ignored the fact that their own execs made a ton of money. We specifically called out RIAA boss Cary Sherman's <a href="http://www.techdirt.com/articles/20110522/19573314384/riaa-two-top-execs-made-48-million-2009-how-many-musicians-could-that-have-funded.shtml">2009 salary</a>.  At the time, I realized it was odd that we hadn't seen any update on salaries, since they have to file these things publicly.  Well, it turns out that the RIAA was just dragging its heels, and Torrentfreak <a href="http://torrentfreak.com/riaa-revenue-dwindles-as-labels-cut-back-120817/" target="_blank">highlighted the latest filing</a>, noting mainly that the RIAA's budget is shrinking drastically, as members are paying less (in part due to massive consolidation from the major labels).
<br /><br />
That said, it doesn't seem to have dampened the salaries the RIAA is paying its top execs.  This report covers 2010, so it's out of date.  Mitch Bainwol is still there and Cary Sherman is the number two guy, rather than top dog as he is now.  Still, if being rich and arrogant is evidence of someone up to no good, the RIAA's top brass may have some explaining to do:
<center>
<a href="http://imgur.com/2TPfe"><img src="http://i.imgur.com/2TPfe.png" width=560 /></a>
</center>
It certainly looks like nearly all of the RIAA's top brass are either deeply embedded in the <a href="http://www.financialsamurai.com/2011/04/12/how-much-money-do-the-top-income-earners-make-percent/" target="_blank">top 1% of earners</a> or very close to the borderline (about $380k per year).  Mitch Bainwol and Cary Sherman each made over $1 million.  Neil Turkewitz, Mitch Glazier and Steve Marks all made over $600k.  Considering how phenomenally unsuccessful the RIAA has been over the past decade, you'd think that its members could find cheaper execs to keep driving the organization into the ground.  As TorrentFreak points out, membership dues dropped from $49.76 million in 2008 down to just $27.88 million in 2010.  You'd think that money could be spent somewhat more effectively, rather than pining for a past where they were gatekeepers in control of the market.<br /><br /><a href="http://www.techdirt.com/articles/20120817/15551120085/as-label-funds-to-riaa-dry-up-top-execs-still-make-over-1-million.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120817/15551120085/as-label-funds-to-riaa-dry-up-top-execs-still-make-over-1-million.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120817/15551120085/as-label-funds-to-riaa-dry-up-top-execs-still-make-over-1-million.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>non-profit?</slash:department>
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<pubDate>Fri, 10 Aug 2012 18:33:00 PDT</pubDate>
<title>Brandon Boyd Of Incubus On The Future Of Music And Life Without A Label: 'It's A Really Cool Thing Because It Keeps Everyone On Their Toes'</title>
<dc:creator>Tim Cushing</dc:creator>
<link>http://www.techdirt.com/articles/20120806/19162719948/brandon-boyd-incubus-future-music-life-without-label-its-really-cool-thing-because-it-keeps-everyone-their-toes.shtml</link>
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<description><![CDATA[ Brandon Boyd has seen both ends of the music industry. With his band Incubus, Boyd rode possibly the last big wave (nu-metal) crafted by the labels. Now, faced with heading out label-less for the first time, Boyd has a <a href="http://www.noizenews.com/archives/10063" target="_blank">refreshingly realistic outlook on the challenges he and his band face in the future</a>.
<blockquote>
<i>We are, for the first time since 1996, we are free agents again. We're without a record label. So what we're kind of doing is trying to get our bearings as to what we should do next, just as a band but also as a band that is kind of off in new territory again.</i></blockquote>
Fortunately for Boyd, he's not completely unprepared for life without a label. During the shakeup at Epic Records and Sony's restructuring, Incubus sort of fell between the cracks and dealt with "a real lack of direction and leadership just when we needed it most." Surprisingly, Boyd isn't bitter about the experience and notes that it left the band free to start exploring other options, including put more effort towards connecting directly with their fans:
<blockquote>
<i>So it was hard and it was frustrating but it was also very telling for us and perhaps educational. Because what we were forced to do was we were forced into ingenuity. And so we came up with this idea to set up shop in this art gallery in Los Angeles and do the Incubus HQ and fly listeners in from different corners of the world and do these live broadcasts on the Internet. And so we started getting these ideas about subscription-based live concerts online and it ended up being a really scary and stressful project, but the fruits of it are still kind of revealing themselves. </i><br />
<br />
<i>We have this HQ box set that we're putting out and the DVD set comes out I think August 14 is the release date. There's like the superfan all six nights on DVD mixed in 5.1 with the CDs and pieces of canvases that people were drawing on in the room while we were playing music. Like I said, it's forced us to think outside of that normal music industry paradigm that we had gotten so accustomed to. And so in that sense the lack of attention from our record label and the end days of our record label relationship were really good and very beneficial for us as a band because it gave us a sense of what we might be doing in the coming years.</i></blockquote>
Living through massive disruption turns some artists into doomsayers who demand the <a href="http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml" target="_blank">world repent of its "sins"</a> and return to the "Old Way." Boyd lived through the so-called Napster years and came up with a completely different conclusion: adapt or be left behind. The upside of the old way was nice:
<blockquote>
<i>Linkin Park and Incubus were two of the very few bands who kind of like got a gust of wind out of the old paradigm of the music industry. But like survived out of it. There are so many bands that, bands in a traditional sense, bands who write their own music, and perform their music, that didn't survive that transition. That fell by the wayside with the industry. So it&rsquo;s been frightening to watch something that you for a very brief moment almost learned to rely on, because we learned the ins and outs of how the industry worked, you know you poured your heart out into making an album and then the label puts the record out and you go out on tour in support of the album, and we even started doing it in the van and trailer. We'd make a record and get in the van with our gear and the trailer and we'd drive ourselves around the country and sell albums and T-shirts out of the back of the trailer. That was sort of our education and then once things started going really well, thankfully, we got a sense of what it looks like when all of the, when the engine is nicely greased and things are working the way they're supposed to.</i></blockquote>
But when that way was no longer viable, Incubus moved on, rather than hold on to the way it used to be:
<blockquote>
<i>And then it's like the millennium turns and the technology changed. And all of that became old. It became an antiquated model. And it was frightening at first but I actually have come to appreciate it. I'm going to actually use the pun, a living thing. It's a living system. Our technologies are a living system just like we are and our communities as human beings, and for us to expect them to remain constant is really just quite foolish. I mean anybody that's going to come to rely on the way that our music consumption is looking now is going to have the same hard lesson in less time than you think. I think that the technology is going to shift probably sooner than any of us really realize. And that's a really cool thing, because it keeps everyone on their toes. It levels the playing field, too. It's allowing for a really wonderful democratization of the music writing process and the music presenting and performing process. So what it's doing is it's making us try harder and it's making us expect the best of ourselves and the people that we work with. You know, do more with less.</i></blockquote>
That's the way it works now if you're going to succeed. It's artists vs. limited attention and limited entertainment budgets. <a href="http://www.techdirt.com/blog/casestudies/articles/20111222/12435717172/louis-ck-over-1-million-sales-just-12-days-drm-free-download.shtml" target="_blank">A connection is vital</a> and a willingness to explore every option is nearly mandatory if you're going to get anywhere.<br />
<br />
What's more amazing about these statements is there is no mention of the music industry's favorite villain, piracy. Boyd sees what the real issue is: disruption. And rather than wait for someone to "fix" the "problem," he's moving as fast as he can to stay ahead of the curve. He's not letting his situation be dictated by others and because of that, he's got a good chance to keep his creative career going.
<blockquote>
<i>I personally, when all is said and done, I really welcome these changes. And they excite me. And they scare me at the same time, but I'm choosing to focus on the excitement.</i></blockquote>
It <i>is</i> a scary time to be an artist. <i>Nothing</i>'is guaranteed. But it's also a time when the field is wide open and the possibilities nearly unlimited. Focusing on the wrong aspect gets you nowhere, but being willing to look past everything that seems to be going <i>wrong</i> and make the most of what's going right.<br /><br /><a href="http://www.techdirt.com/articles/20120806/19162719948/brandon-boyd-incubus-future-music-life-without-label-its-really-cool-thing-because-it-keeps-everyone-their-toes.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120806/19162719948/brandon-boyd-incubus-future-music-life-without-label-its-really-cool-thing-because-it-keeps-everyone-their-toes.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120806/19162719948/brandon-boyd-incubus-future-music-life-without-label-its-really-cool-thing-because-it-keeps-everyone-their-toes.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>it's-easier-to-move-forward-when-you're-already-looking-that-direction</slash:department>
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<pubDate>Thu, 8 Mar 2012 02:26:23 PST</pubDate>
<title>KiD CuDi's WZRD Debuts At No. 3 Despite Being Swept Under The Rug By Universal</title>
<dc:creator>Leigh Beadon</dc:creator>
<link>http://www.techdirt.com/articles/20120307/16295418031/kid-cudis-wzrd-debuts-no-3-despite-being-swept-under-rug-universal.shtml</link>
<guid>http://www.techdirt.com/articles/20120307/16295418031/kid-cudis-wzrd-debuts-no-3-despite-being-swept-under-rug-universal.shtml</guid>
<description><![CDATA[ <p>Last week we <a href="http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml">wrote</a> about WZRD, the new album from <a href="http://en.wikipedia.org/wiki/Kid_Cudi" target="_blank">KiD CuDi</a> on which he went in an entirely different direction from his usual style. That's the kind of thing that makes big record labels nervous (they'd prefer artists just keep churning out variations on their first success) and CuDi's label Universal Republic was no exception. After the release, CuDi took to Twitter to vent:</p>

<blockquote><em>Ok so just a heads up, my weak ass label only shipped 55k physicals cuz they treated this like some indie side project tax right off. So i apologize on behalf of my weak ass major label. And I apologize for the lack of promo, again, my weak ass major label. They tried to rush me thru this so i can just give em another MOTM, but guess what? Fuck that, next album is WZRD. MOTM3 on hold til 2014. who mad??? not me and @DotDaGenius. So its def gonna be tough to find one in the stores guys, I'm sorry about that.</em></blockquote>

<p>Apparently fans were prepared to make the effort, because <a href="http://www.billboard.com/news/kid-cudi-s-wzrd-scores-top-billboard-200-1006383752.story" target="_blank">WZRD debuted at #3 on the Billboard 200 albums chart</a>. This is especially funny in the wake of RIAA CEO Cary Sherman's <a href="http://www.techdirt.com/articles/20120305/10142117983/riaa-still-doesnt-get-it-hopes-sopa-opposition-was-one-time-experience.shtml">recent interview</a>, in which he claimed record labels were needed to "separate the wheat from the chaff" and "designate who is worth promoting and marketing". It seems the legacy gatekeepers aren't quite as good at curation as they think&mdash;at least I bet Universal is wishing they'd gotten a few more copies of WZRD out there, and put some promotional weight behind the project. Maybe, if they'd put a little faith in their own artist, they could have had a #1 on their hands.</p><br /><br /><a href="http://www.techdirt.com/articles/20120307/16295418031/kid-cudis-wzrd-debuts-no-3-despite-being-swept-under-rug-universal.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120307/16295418031/kid-cudis-wzrd-debuts-no-3-despite-being-swept-under-rug-universal.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120307/16295418031/kid-cudis-wzrd-debuts-no-3-despite-being-swept-under-rug-universal.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>the-fans-have-spoken</slash:department>
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<pubDate>Wed, 29 Feb 2012 13:46:34 PST</pubDate>
<title>If Major Labels Are All About Helping Artists, Why Do We Keep Seeing Artists Calling Out Their Labels For Screwing Them?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml</link>
<guid>http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml</guid>
<description><![CDATA[ It still really amazes me that anyone takes the major labels or the RIAA seriously when they make claims about how they're doing what they do to help artists.  The labels have a long and detailed track record of screwing over artists at every opportunity. We're seeing some details around that in some of the <a href="http://www.techdirt.com/articles/20120223/14091117852/did-universal-music-try-to-expense-costs-eminems-producers-suing-over-unpaid-royalties-back-to-eminems-producers.shtml">recent</a> <a href="http://www.techdirt.com/articles/20120220/04491417812/kenny-rogers-lawsuit-shows-many-ways-that-major-label-screws-artists-even-big-ones.shtml">lawsuits</a> we've covered.  But, as we've heard time and time again from various artists, it goes much further than just fancy RIAA accounting. 
<br /><br />
The major labels tend to pick ahead of time just a few "winners" that they're going to put any real effort behind.  If you're signed to a label, but aren't one of the chosen few, you're pretty much screwed.  The label still owns everything, but you get no real marketing support, and you're limited in what you can do.  So your album "flops" even though it was destined to do that from the beginning.  To some extent, this is the nature of the business model that the majors have set up, where they only make money on a very small number of <a href="http://www.techdirt.com/articles/20120214/02015317752/katy-perry-shows-how-problem-with-major-labels-is-economics-not-piracy.shtml">big hit albums</a>, that they spend a ridiculous amount of money promoting.  Everything else just isn't worth it for them.  Of course, that doesn't mean those albums are bad, or that they might be quite profitable if they weren't locked into the majors' obsolete way of doing things.  But for the artists who get the short end of one of those types of label deals it can be incredibly frustrating.
<br /><br />
Take, for example, the situation of <a href="http://en.wikipedia.org/wiki/Kid_Cudi" target"_blank">KiD CuDi</a>, a hip hop artist who's been considered one of the bigger up and coming acts these days.  However,  he recently decided to go in a slightly different direction, and put together a more <a href="http://www.billboard.com/events/kid-cudi-dot-da-genius-preview-wzrd-album-1006276952.story" target="_blank">rock-influenced album</a>, citing inspiration from Pink Floyd, Nirvana, the Pixies and ELO.  That album came out yesterday, and apparently Universal Music decided that it wasn't going to support the album much at all, leading CuDi to <a href="http://dajaz1.com/2012/02/28/kid-cudi-spazzes-on-his-label-for-not-shipping-enough-of-the-wzrd-album/" target="_blank">unload on Universal via Twitter</a> for its lack of support.  Put together, his tweets read:
<blockquote><i>
Ok so just a heads up, my weak ass label only shipped 55k physicals cuz they treated this like some indie side project tax right off. So i apologize on behalf of my weak ass major label. And I apologize for the lack of promo, again, my weak ass major label. They tried to rush me thru this so i can just give em another MOTM, but guess what? Fuck that, next album is WZRD. MOTM3 on hold til 2014. who mad??? not me and @DotDaGenius. So its def gonna be tough to find one in the stores guys, I'm sorry about that. I gotta go out and find one too, becuz my weak ass label never even gave us a copy of our own album. FAIL!!! Im lettin Universal Republic have it, fuck it. What they gon' do, spank me?? hahahaha. AND Teleport 2 Me, Jamie aint on the radio!!!! like helloooooooooo????? HIT HIT HIT!!!
</i></blockquote>
Obviously, Universal Republic made a decision not to support this album, because they don't think it'll bring back what they want it to.  And that's their decision -- but that's one of the risks of signing with a major label, and it's one of the reasons why more artists should really think twice about giving so much control to an entity that might just decide to stop supporting you.  I don't begrudge Universal making this decision, but it again highlights that the major labels aren't looking out for the best interests of the artists at all.  They're looking out for their own best interests.
<br /><br />
This isn't to say that all labels are bad.  Artists can find some smart and innovative independent labels that still give the artists plenty of say and control, but the majors are the majors, and to think they represent the artists is clearly a joke.  So when it comes to public policy debates, why do politicians and the press still continue to assume that the RIAA and major label view is what's best for the artists?<br /><br /><a href="http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120228/17592017904/if-major-labels-are-all-about-helping-artists-why-do-we-keep-seeing-artists-calling-out-their-labels-screwing-them.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>just-saying</slash:department>
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<pubDate>Mon, 20 Feb 2012 11:00:00 PST</pubDate>
<title>If You're Going To Compare The Old Music Biz Model With The New Music Biz Model, At Least Make Some Sense</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml</link>
<guid>http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml</guid>
<description><![CDATA[ David Lowery, from the bands Cracker and Camper van Beethoven (which I actually like), appeared at last week's SF Music Tech to talk about how things have never been <b>worse</b> for musicians.  I unfortunately missed his session, but it's been getting some attention.  Thankfully, it turns out that he had <a href="https://www.facebook.com/davidclowery/posts/10150546073612402" target="_blank">posted many of the details to his Facebook page</a>, which lets us dig in... and raise some pretty serious questions about his claims.
<br /><br />
However, before we get into the details, I will say that I do think that things may be worse for a specific segment of musicians -- and it's a segment that Lowery may fall into.  Things are almost certainly worse <i>if</i> you were just sorta marginally successful under the old model <i>and</i> you have no interest in putting in much effort.  Superstars are superstars no matter what -- and thanks to the nature of viral culture, that still gets them propelled to superstardom these days.  But lower down in the market things have changed.  The folks who used to completely fail out of the music world now have lots of interesting new ways to make money.  And that means that there's more competition <i>from below</i> for the moderately successful acts -- who were neither superstars nor failures under the old system.  Acts like Cracker and Camper van Beethoven.  Suddenly, folks like David Lowery have a lot more competition for attention, and if he does nothing to leverage the new tools that are available, it wouldn't surprise me if he's worse off today than in the past.  But that's for him.  It's likely that for the vast majority of other musicians, the situation is quite different.
<br /><br />
Of course, that's not even the argument he's making.  The argument he <i>does</i> make actually makes so little sense that I'm surprised he chose this argument to make his point.  First off, he's comparing totally different things:
<blockquote><i>
We know this empirically. The facts and evidence are in. Let's start with the best case scenario. Let's just look at the division of gross revenues and expenses. The scenario where the artist puts out the record themselves on their own label. 
</i></blockquote>
First of all, I'm not sure that the "best case scenario" is when an artist puts out the record themselves on their own label.  That certainly works quite well for some artists -- but it's not for everyone.  So I think it's a little weird to call that the "best case" scenario.
<blockquote><i>
Okay the vast majority of sales take place on iTunes and Amazon. How much does the artist get paid? Well if you are independent you get 61% of gross. cause you need either a distributor or an aggregator to get on iTunes. iTunes itself keeps more than 30% for simply hosting the songs on their servers. They do absolutely nothing else. This is why steve jobs was a genius. He was not afraid to be greedy. So now an old style record deal might have netted the artist 20-35% of gross (most reports of artists deals are wrong and low because they don't include the mechanical royalties).
</i></blockquote>
Okay, what?!?  Apple gets 30% for simply hosting the songs on their servers?  At this point, Lowery loses <i>all credibility</i>.  First of all, Apple does a hell of a lot more than that.  It sets up a <i>store</i>, brings in <i>customers</i>, manages <i>transactions</i>, handles <i>the distribution</i>, and (on top of all that) <i>sells the music playing devices</i> that many people use to listen to the songs.  To assume that's just "hosting the songs on a server" is just crazy.
<br /><br />
But, here, I'll prove it: if Apple is really getting 30% for "absolutely nothing else" other than "hosting the songs on their servers," then that's a really easy problem to solve: just host the music yourself and take your songs off of iTunes.  I actually don't use iTunes, but asked a friend who said that, indeed, Camper van Beethoven has 7 albums available for download on iTunes.  Cracker has 10 albums.  On Amazon, you get the exact same numbers.  So, clearly, someone finds value beyond just having them hosted.  Of course, if you look at the websites for <a href="http://campervanbeethoven.com/fr_home.cfm" target="_blank">Camper van Beethoven</a> and <a href="http://crackersoul.com/fr_home.cfm" target"_blank">Cracker</a>, you'll see that, not only are they hideously designed (using ColdFusion?!?), but they don't really have a way for people to buy most of their albums.  Hidden behind a "downloads" link on both sites, they have a very limited offering for sale.  Hmm... perhaps <i>someone</i> finds something useful about iTunes and Amazon after all.  Otherwise, why use them if they're doing "absolutely nothing else" other than hosting the music and taking a 30% cut?  There also doesn't seem to be any way to buy any merchandise or any other way to support the band if people want to.  Perhaps the reason Lowery is doing so much worse today is because he's not actually enabling any of the parts of the new business model that might help him succeed.
<br /><br />
Also, as for the distributor or the aggregator, Lowery might want to check out something like TuneCore.  While it does have a yearly fee, I'm pretty sure it actually lets artists keep all the royalties they make from iTunes.
<br /><br />
As for the 20 to 35% gross number and how lower numbers are "wrong," that's sorta true, but not entirely.  The lower numbers are correct for what your standard royalty is in a record contract.  Those who are <i>songwriters</i> (as Lowery is) get an additional publishing royalty based on mechanicals, which are compulsory rates.  So there's that.
<blockquote><i>
The old deals weren't great on first glance but then if you start digging into it they weren't as bad as people think. And as i will show you were in most cases a better deal for the artists then the New model. 61% of gross is a lot better than 20-35% of gross until you consider the fact that under the new model the artist is responsible for all aspects of the records production, marketing and distribution. 
</i></blockquote>
Again, this assumes that there is one "New Model" and that it is being your own label and posting your stuff to iTunes.  Since I don't think either of those things is accurate, it seems pointless to go much deeper on this point.
<blockquote><i>
The Artist pays for the recording, the artist pays for all publicity, promotion and advertising. and here is the key thing. The artist absorbs the costs of touring.
</i></blockquote>
Um.  I hate to bring this up, but for the most part, that's true under the old model too.  There is one difference: the labels will often front the money for those things, but they definitely want to get that back, and until they do, the money that you're getting from "royalties" (outside of the publishing royalties) is pretty much nothing because you haven't recouped.  Obviously, for many artists, having that kind of money fronted is helpful, so I'm not negating that part.  But there are alternatives these days -- including other "New" models (which Lowery ignores) like Kickstarter to help raise funds.  Also, the cost of doing a recording has dropped tremendously over the years.  As for publicity, promotion and advertising -- he's right.  But again, under the old system, only a very small number of bands really would get the labels to do anything about publicity, promotion and advertising -- and these days, it's a lot easier for bands to do much of that on their own.
<blockquote><i>
You know only a handful of artists make a living touring right? most artists need another job to go back to or they get tour support from the record label. Touring usually only pays enough to pay the crew and expenses. Touring only makes sense if it increases your sales. Artists often go on tour for free in hopes that the tour pays off in increased sales. 
</i></blockquote>
I recognize that Lowery's been in the music world for a long time -- which gives him some credibility -- but it also means he's kinda locked into the way things used to work, and not so much on how they <i>can</i> work.  With new services like Eventful, bands are increasingly discovering that they can tour more efficiently, and figure out ways to make the tours themselves profitable, rather than having the tours support album sales.
<blockquote><i>
Plus the new model makes the artist absorb ALL THE RISK. The risk of making a recording that doesn't recoup. The risk of going on tours that don't increase sales enough and become a loss.
</i></blockquote>
This is definitely true.  The labels do absorb the risk.  Which is why we've said time and time again that there's still room for new labels that understand the new business models and can work within that framework.  But, the "price" that the major labels charge for absorbing that risk is kinda crazy. Not only do you give up your copyrights for the risk, you also give up the vast majority of the income from your sales.  Compare that to the startup world.  There, venture capitalists will often invest in companies, and put up the "risk capital" on hugely risky bets (much riskier than an album).  But rather than taking over all IP rights, all revenue and then paying back a mere pittance to the entrepreneurs, venture capital takes an equity stake, gets no rights to revenue and owns the percentage of the IP that they get via equity.  Something's out of whack -- and it's the terrible deals the labels give.
<br /><br />
Either way, again, there are other ways to absorb that risk.  I've already mentioned two: crowdfunding platforms like Kickstarter, or more modern indie labels that understand new business models and leave more power to the aritsts.
<blockquote><i>
Now consider iTunes and Amazon who are now the biggest music companies of all. They put up ZERO CAPITAL and ZERO RISK and they get 30% of the gross in return. At least the old record label system shared some of the risk! Wow the old labels were not so evil compared to the new labels. 
</i></blockquote>
Wait, what?!?  Again, we're back to something that makes no sense at all.  iTunes and Amazon are <i>the retailers</i>, not the "labels."  It makes no sense to compare them.  If we're going to actually compare apples to apples, then you would compare iTunes and Amazon to traditional retail outlets.  And when did Tower Records ever put up the capital for musicians to record an album?  What about Walmart?  Seems like they're a lot like Amazon and Apple... and it looks like the amount of money they took may have been even higher.  I'll let Jeff Price from Tunecore (someone who knows quite a bit about this) summarize how things <a href="http://blog.tunecore.com/2010/10/music-purchases-and-net-revenue-for-artists-are-up-gross-revenue-for-labels-is-down.html" target="_blank">used to work</a>:
<blockquote><i>
The financial food chain of the music industry used to be as follows. A distributor sells a CD to a retail store for a wholesale price (let's say $10). The retail store marks the CD up to $16.98 and make $6.98. The distributor takes a &#8220;distribution fee&#8221; of 20% of the wholesale price (in this case $2) and passes the remaining $8 back to the label.
<br /><br />
A band signed to a major label could expect to earn a band royalty rate of $1.40 &#8211; $1.70 per full length CD sold. This band royalty was paid through to the artist if they had &#8220;recouped&#8221; the band royalty fronted to them by the label (i.e. an &#8220;advance&#8221;) &#8211; most do not recoup.
</i></blockquote>
Ok.  So, in that scenario, the retailer is making $6.98 on a $16.98 CD.  That's... wait for it... <b>41%</b>.  Yeah, that's more than what Amazon and iTunes charge.  I'm kinda shocked Lowery would make this comparison since it makes no sense and sorta takes away his credibility here.
<blockquote><i>

So essentially THE NEW BOSS in the new model is iTunes and Amazon (also indirectly Google). And THE NEW BOSS is actually more greedy than the old boss. 
</i></blockquote>
Um.  No.  First off, we're still comparing apples to oranges.  Also, I have no idea where Google comes in, as I don't see where they're charging 30% in this transaction.  But, as noted above, it seems like these new <i>retailers</i> are actually charging less than the old retailers.
<blockquote><i>
Now of course the independent artist can still sell so many albums that the higher percentage of gross 61% overwhelms the higher initial costs. But I bet this is not the case for most of your favorite artists. The increased costs and responsibilities make THE NEW MODEL a worse deal. The artists that do better under the new model are few and far between. That's why so many artists that seemingly could go independent do not. They still use record labels. Look carefully at your favorite artists latest record. Is it still on a standard record label? A lot of smart well managed bands still on labels. Why? Because the NEW MODEL is actually worse.
</i></blockquote>
Again, this is just ridiculous.  He's making two assumptions that are just crazy.  The first is that the new model means no record labels at all (it doesn't).  And, secondly, that the <i>only</i> revenue source is sales (it's not).
<br /><br />
I guess you can prove anything you want when you're setting up the straw men.
<blockquote><i>
In the new model you have these parasitic entities (itunes etc) that take 30% of gross and provide no added value. As screwed up as the old business was there was this giant parasitic entity sucking out 30% of gross for nothing. This should suggest to any intelligent person that there is something seriously wrong with the NEW MODEL
</i></blockquote>
Again, if they do nothing, then <i>don't use them</i>.  But clearly they do plenty, because he <i>is using them</i>.  And part of what they do is they <i>have the audience</i>, which is tremendously valuable.  Second, they appear to charge <i>less</i> than old brick and mortar retailers, so his entire argument is... um... wrong.
<blockquote><i>
Now I'm as surprised as you that we would evolve a worse system than the old record label system. But facts are facts. We have. And I'm not happy about either. 

</i></blockquote>
Facts are facts, but his interpretation is ridiculous.
<blockquote><i>
And finally please don't be an idiot arguing with me if you can't point to real evidence. or you don't know the actual percentages or costs. You can't just drop hearsay, urban myths, fairytales and pretend they are facts. If you do I reserve the right to flame your ass for talking out of your ass.
</i></blockquote>
This is someone who doesn't want to hear he's wrong -- shutting off anyone who disagrees with him.  Of course, that shouldn't stop people from responding and pointing out his errors.  The only point on percentages I made came from Jeff Price -- who I'd argue knows a hell of a lot more about this than David Lowery does.  Not only is Price probably responsible for getting more artists on iTunes than anyone short of Steve Jobs, but he also founded and ran a successful indie record label for years.  On the other points, they've got nothing to do with percentages, they have to do with reality.
<br /><br />
Hey, perhaps it's true that musicians are worse off today than in the past.  The evidence we've seen suggests something entirely different -- and Lowery's own argument is about as nonsensical as any we've seen to date.  So forgive me for being less than convinced.<br /><br /><a href="http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120220/00310917802/if-youre-going-to-compare-old-music-biz-model-with-new-music-biz-model-least-make-some-sense.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>just-saying...</slash:department>
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<pubDate>Fri, 2 Dec 2011 15:31:49 PST</pubDate>
<title>How Labels Pulling Out Of Spotify Are Doing Massive Harm To Themselves</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20111201/04085816941/how-labels-pulling-out-spotify-are-doing-massive-harm-to-themselves.shtml</link>
<guid>http://www.techdirt.com/articles/20111201/04085816941/how-labels-pulling-out-spotify-are-doing-massive-harm-to-themselves.shtml</guid>
<description><![CDATA[ Just a couple months ago, we pointed out how labels dropping out of Spotify were <a href="http://www.techdirt.com/articles/20110922/11224716052/labels-dropping-out-spotify-are-totally-missing-point.shtml">totally missing the point</a>.  A few labels had argued that Spotify only pays a tiny amount per stream, and that was somehow cutting into sales revenue.  However, two recent stories we wrote about highlight how this is becoming an even more braindead move than before.  And yet, the trend continues.  Just recently there were stories about <a href="http://www.avclub.com/articles/more-than-200-indie-labels-just-pulled-music-from,65479/" target="_blank">over 200 labels being pulled off Spotify</a> by distributor STHoldings, who gave the usual song and dance about not cannibalizing revenue.
<br /><br />
Here's why that's dumb.  First, as we saw in the <a href="http://www.techdirt.com/articles/20111201/03191216939/yet-another-study-shows-that-hollywoods-own-bad-decisions-are-increasing-amount-infringement.shtml">recent study about piracy</a>, taking content away from where people want it doesn't lead to increased sales.  As the professors who did the report <a href="http://thehill.com/opinion/op-ed/196051-delaying-content-leaves-money-on-the-table" target="_blank">explained</a>:
<blockquote><i>
When NBC removed its content from the iTunes store for about nine months in 2007 and 2008, there was an 11.4 percent increase in piracy, but no increase in NBC&rsquo;s DVD sales &mdash; a loss of close to $20 million, given 23,000 lost sales per day at an average price of $3. And when ABC added its content to Hulu in July 2009, piracy dropped by 30 percent. Likewise, when a major book publisher stopped selling new Kindle titles on Amazon in 2010, there was no increase in hardcover sales, and when the Kindle titles were finally made available, their sales were 50 percent lower than they otherwise would have been.
</i></blockquote>
Making your content available on these platforms drives sales elsewhere.  Keeping them off does the opposite.  It actually hurts sales.
<br /><br />
Add to that the release of <a href="http://www.techdirt.com/articles/20111201/03541116940/spotify-finally-becomes-true-platform-now-lets-see-some-innovation.shtml">the new platform</a> for developers.  That means that soon there will be a ton of ways to build additional revenue opportunities on top of Spotify.  It'll be easy to buy concert tickets.  Or merchandise.  Or collectable items.  Or pretty much anything you want... directly through the Spotify music player itself.  But if the bands aren't there, then people will simply ignore or forget about those acts... and they'll find others via Spotify.<br /><br /><a href="http://www.techdirt.com/articles/20111201/04085816941/how-labels-pulling-out-spotify-are-doing-massive-harm-to-themselves.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20111201/04085816941/how-labels-pulling-out-spotify-are-doing-massive-harm-to-themselves.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20111201/04085816941/how-labels-pulling-out-spotify-are-doing-massive-harm-to-themselves.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>are-they-that-clueless?</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20111201/04085816941</wfw:commentRss>
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<item>
<pubDate>Thu, 19 May 2011 12:18:07 PDT</pubDate>
<title>Major Labels Shamed Into Promising To Give Some Of $105 Million Limewire Settlement To Artists</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20110519/10041714342/major-labels-shamed-into-promising-to-give-some-105-million-limewire-settlement-to-artists.shtml</link>
<guid>http://www.techdirt.com/articles/20110519/10041714342/major-labels-shamed-into-promising-to-give-some-105-million-limewire-settlement-to-artists.shtml</guid>
<description><![CDATA[ After Limewire settled with the major labels last week, many of us <a href="http://www.techdirt.com/articles/20110512/21363814255/limewire-settles-105-million-how-much-that-will-go-to-artists.shtml">questioned</a> how much of that money would go to actual artists.  Many people, quite reasonably, pointed to a quote from a few years ago from the RIAA's Jonathan Lamy <a href="http://www.techdirt.com/articles/20110516/11183514285/self-perpetuating-copyright-enforcement.shtml">saying</a>, "Any funds recouped are re-invested into our ongoing education and anti-piracy programs."  That line got a lot of attention, and I wondered if the labels would be forced to actually give some money to artists, and it appears that may be happening.  Lamy came out and said that <a href="http://www.hypebot.com/hypebot/2011/05/riaa-executive-responds-to-limewire-105m-settlement-controversy.html" target="_blank">his quote was about something else</a> -- the RIAA's lawsuits against individuals (hurray for suing fans!), rather than this lawsuit against Limewire.  Now, the major labels are starting to step forward and say that <a href="http://www.hypebot.com/hypebot/2011/05/3-major-labels-say-theyll-share-limewire-settlement-but-new-pr-nightmare-emerges.html" target="_blank">yes, yes, yes, they'll give some of the money to artists</a>.  I'm guessing, at this point, that it's purely a crisis management type situation, where the labels are realizing they need to show that they're giving some of the money to artists (in part because all these stories mean that <i>the artists themselves have started asking</i>).  So now that the labels promise to give some of the money to artists, let's see if they ever say how much actually goes to artists...<br /><br /><a href="http://www.techdirt.com/articles/20110519/10041714342/major-labels-shamed-into-promising-to-give-some-105-million-limewire-settlement-to-artists.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20110519/10041714342/major-labels-shamed-into-promising-to-give-some-105-million-limewire-settlement-to-artists.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20110519/10041714342/major-labels-shamed-into-promising-to-give-some-105-million-limewire-settlement-to-artists.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>but-how-much?</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20110519/10041714342</wfw:commentRss>
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<pubDate>Thu, 16 Dec 2010 15:33:00 PST</pubDate>
<title>Record Labels Angry That Hadopi Isn't Kicking People Off The Internet Fast Enough</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20101216/01430612298/record-labels-angry-that-hadopi-isnt-kicking-people-off-internet-fast-enough.shtml</link>
<guid>http://www.techdirt.com/articles/20101216/01430612298/record-labels-angry-that-hadopi-isnt-kicking-people-off-internet-fast-enough.shtml</guid>
<description><![CDATA[ A few months back, we noted that Hadopi, the French bureaucracy in charge of sending out "you're an infringer" notices and then kicking people off the internet under that country's three strikes plan, was <a href="http://www.techdirt.com/articles/20101022/16414511552/hadopi-already-up-to-sending-out-25-000-first-strike-notices-per-day.shtml">receiving 25,000</a> notices from record labels per day (there was some confusion on that story, as I originally believed Hadopi was sending <i>out</i> 25,000 notices, but it was only receiving that many).  Only a few months later, and the labels have now ramped it up to 50,000 per day, which was the target amount that they had set back in September.  However, it appears that the record labels are upset that, while they're sending Hadopi 50,000 notices per day, Hadopi is only <a href="http://www.zeropaid.com/news/91562/french-three-strikes-warnings-far-below-music-industry-hopes/" target="_blank">sending out notices on about 2,000 per day</a>.  The industry wants Hadopi to just do what I had thought they were doing originally and rubber-stamp all their notices and pass them on.  It hopes to get up to 10,000, but the industry is still pushing for 50,000 per day, which is <i>insane</i> when you think about it.
<br /><br />
Think about how many mistakes are being made when you're sending 50,000 notices per day.  Over the course of about five years, the RIAA apparently sued less than 20,000 people -- and still made a lot of mistakes.  US Copyright Group got a lot of attention for accusing a few thousand people of file sharing particular movies -- and also appears to have made a lot of mistakes.  Yet, here, with Hadopi, the labels are accusing <i>50,000</i> people per day, and are upset that Hadopi isn't just rubber stamping all the notices?  It appears that the record labels don't care at all about what happens if they accuse totally innocent people.<br /><br /><a href="http://www.techdirt.com/articles/20101216/01430612298/record-labels-angry-that-hadopi-isnt-kicking-people-off-internet-fast-enough.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20101216/01430612298/record-labels-angry-that-hadopi-isnt-kicking-people-off-internet-fast-enough.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20101216/01430612298/record-labels-angry-that-hadopi-isnt-kicking-people-off-internet-fast-enough.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>pick-up-the-pace</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20101216/01430612298</wfw:commentRss>
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<pubDate>Thu, 23 Sep 2010 12:18:05 PDT</pubDate>
<title>Label Complains That Amazon Devalues Artists By Making Music Cheap</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100922/04284311111/label-complains-that-amazon-devalues-artists-by-making-music-cheap.shtml</link>
<guid>http://www.techdirt.com/articles/20100922/04284311111/label-complains-that-amazon-devalues-artists-by-making-music-cheap.shtml</guid>
<description><![CDATA[ This is unfortunate.  Nearly two years ago, we wrote about the indie music label Asthmatic Kitty, which seemed to take a <a href="http://www.techdirt.com/articles/20090212/1301143750.shtml">really forward looking attitude</a> towards the new music market.  In that interview, the label noted the reality of the new world, and why it was important to focus on reasons to buy, rather than assuming that people would just pay to hear music.  This is what was said at the time:
<blockquote><i>
I operate under the conviction that people buy records because they want to own them, not because they want to hear them. It is too easy these days to hear a record without having to buy it. I don't resent that fact, rather I feel we at Asthmatic Kitty embrace it through streaming albums and offering several free mp3s (even whole free albums). And why do they want to own it? They want it to illustrate to others their taste and identify who they are as a person. I also believe they want to be part of something bigger than themselves, they want to belong. 
<br /><br />
Our job is no longer to sell folks things they want to hear. They want an experience and to identify themselves as part of a community. Ownership then becomes a way of them supporting your community through investing in that community. Fostering that in an honest, transparent and "non-gross" way takes a combination of gracefulness, creativity and not taking oneself too seriously, while still taking art and music seriously.
</i></blockquote>
Apparently, however, they <i>do</i> resent Amazon for making music available cheaply.  Reader Colin points us to a recent article about how Asthmatic Kitty has sent out a letter to fans of artist Sufjan Stevens, <a href="http://www.pastemagazine.com/partners/va/?vaid=30a302850649a3012f1989fe5e67d69f" target="_blank">complaining that Amazon's pricing is too low</a> and asking people to go to Bandcamp and pay more instead.  They do admit to being somewhat conflicted about this, at least:
<blockquote><i>
"We have mixed feelings about discounted pricing," the label explained.
<br /><br />
"Like we said, we love getting good music into the hands of good people, and when a price is low, more people buy. A low price will introduce a lot of people to Sufjan's music and to this wonderful album. For that, we're grateful.
<br /><br />
But we also feel like the work that our artists produce is worth more than a cost of a latte. We value the skill, love, and time they've put into making their records. And we feel that our work too, in promotion and distribution, is also valuable and worthwhile."
</i></blockquote>
While they're certainly not attacking Amazon or fans, the whole email does feel a little off.  The simple fact is, if people want the music (as the label seemed to recognize last year), they can find it somewhere for free.  Amazon's prices are meaningless when it comes to the "value" of the music.  Price and value are not the same thing.  Rather than complaining about the price that Amazon sets on the album, why not give people <i>additional reasons</i> to pay directly at Bandcamp -- such as providing valuable extras if they do.  Or discounts on other merchandise.  There are all sorts of <i>positive</i> ways to get people to find it <i>worthwhile</i> to spend money without making them feel guilty and bad for paying a price that is legitimately offered by a retailer.<br /><br /><a href="http://www.techdirt.com/articles/20100922/04284311111/label-complains-that-amazon-devalues-artists-by-making-music-cheap.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100922/04284311111/label-complains-that-amazon-devalues-artists-by-making-music-cheap.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100922/04284311111/label-complains-that-amazon-devalues-artists-by-making-music-cheap.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>you-got-it-backwards</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100922/04284311111</wfw:commentRss>
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<pubDate>Thu, 15 Jul 2010 13:12:00 PDT</pubDate>
<title>Don't Dismiss Musicians Who Forge Their Own Path</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100715/00310210223.shtml</link>
<guid>http://www.techdirt.com/articles/20100715/00310210223.shtml</guid>
<description><![CDATA[ We recently wrote about <a href="http://www.techdirt.com/articles/20100713/00121510187.shtml">Tom Silverman's interview</a> where, in the course of "predicting" the future of the music business, he took some potshots at services like TuneCore for being just for "hobbyists."  In that article, he basically said that TuneCore users were just "clogging" the system:
<blockquote><i>
80 percent of all records released are just noise -- hobbyists. Some companies like TuneCore are betting on the long tail because they get the same $10 whether you sell one copy or 10,000. Who uses Photobucket and Flickr? Not professional photographers -- those are hobbyists, and those are the people who are using TuneCore and iTunes to clutter the music environment with crap, so that the artists who really are pretty good have more trouble breaking through than they ever did before.
</i></blockquote>
As I noted in my original post on the interview, I thought Silverman was making a big mistake in dismissing those "hobbyists," since a bunch of them seemed to be making a decent living -- and the numbers were growing.  I also found the "crap" comment to be pretty obnoxious.  We see that type of comment here all too often.  We'll point to some unique content creator who is doing something impressive, and the response (often from angry industry insiders) is that "yeah, but the content is crap."  It's a funny sort of reaction.  It's as if these people are so afraid that others with better business models will drive them out of business that they need to pre-emptively mock the quality -- even if the content seems to be exactly what a certain market is looking for.  There are lots of content creators that we talk about whose content I don't personally care for.  But my personal opinion on the quality of the content is meaningless.  It's a question of personal tastes, and if there's an audience for the content, then, clearly something's working right.
<br /><br />
I wasn't the only one who felt that the "cluttering with crap" comment was out of line.  TuneCore's Jeff Price (who has been having quite a back-and-forth with Silverman lately) <a href="http://blog.tunecore.com/2010/07/boy-oh-tommyboy-80-of-you-make-music-that-is-crap.html" target="_blank">issued quite the sarcastic apology</a>, while mocking the idea that only Silverman gets to decide what is quality music:
<blockquote><i>
We're sorry that the fact that people are buying music from TuneCore Artists is stopping people from buying music that Tommy likes. If Tommy could only control what music you get exposed to you would be more inclined to buy his music. It's actually a brilliant strategy: limit choice, force the releases you want to sell down people's throats, control what music is exposed by the media outlets (like radio and MTV) and then take all the money from the sales that come in. Oh wait, my mistake, that's the way it was in the old music industry, and 98% of what the majors labels released failed. I guess limiting choice does not make music sell. 
</i></blockquote>
Price also points out that Silverman's claim that this is "clogging" the market is ridiculous.  It's not like people can't find what they want.  If that's a problem, it's a problem of filters, not a problem of too much music.  I tend to listen to some fairly obscure music in some specific genres, and sure there are acts in those areas that I don't think are very good, but it's pretty easy to quickly figure out who is good and who is not and move on.  Claiming that "bad" artists somehow hurt good artists is ridiculous.  You hear it all the time in various industries, but it's the same silly story all over again.  More content creators don't take anything away from good content creators.  Good content creators can and do still thrive.<br /><br /><a href="http://www.techdirt.com/articles/20100715/00310210223.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100715/00310210223.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100715/00310210223.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>subjectivity</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100715/00310210223</wfw:commentRss>
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<item>
<pubDate>Tue, 9 Mar 2010 13:55:00 PST</pubDate>
<title>Record Labels Put Out Misleading Study Trying To Get ISPs To Setup Broken Music Streaming Services</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100308/1855408466.shtml</link>
<guid>http://www.techdirt.com/articles/20100308/1855408466.shtml</guid>
<description><![CDATA[ The record labels have been trying out all sorts of schemes for a while now to try to get ISPs over to its side in propping up their old business models, and the latest is pretty laughable.  BPI at the behest of Universal Music, commissioned a study which suggests that <a href="http://torrentfreak.com/music-biz-hopes-to-end-piracy-by-tempting-isps-with-millions-100308/?utm_source=feedburner&#038;utm_medium=feed&#038;utm_campaign=Feed%3A Torrentfreak %28Torrentfreak%29" target="_blank">ISPs can make a lot of money by offering music services to their users</a>.  No doubt.  But that leaves out some rather pertinent details.  For example: many ISPs have very much <b>wanted</b> to offer such music services, but have <a href="http://www.techdirt.com/articles/20090123/1506253510.shtml">been blocked</a> by the likes of (uh oh...) Universal Music and BPI.  Funny how that works.
<br /><br />
The problem, of course, is that the ISPs want to offer music services that people would actually <i>use</i>, and the record labels want to handicap the services to the point at which they're completely lame.  So there's a bit of a stalemate there.
<br /><br />
But the bigger issue is (reading between the lines here) what the record labels are <i>really</i> saying to ISPs here is: break net neutrality.  That's because they're not talking about just any music service.  After all, there are lots of music services out there that people can sign up for no matter <i>who</i> their ISP is.  But what the labels seems to be suggesting here is that ISPs specify one special music service that locks in customers.  That's why the report highlights that a music service can "reduce churn."  Of course, the only way it does that is if it's locked to that single ISP -- and if your music is limited to you only as long as you're with that ISP.  In other words: locking it down so that it's lame.
<br /><br />
As if to make the point even stronger, though, BPI blatantly tells ISPs to break neutrality:
<blockquote><i>
"It's increasingly clear that it isn't smart to be a 'dumb pipe'. This report shows that the revenue potential of digital music services alone makes sound economic sense for ISPs," said BPI Chief Executive, Geoff Taylor.
</i></blockquote>
Being a "dumb pipe" of course is a well-known code-word in the internet world for a neutral network.  So, really what the labels seem to be suggesting here is that ISPs break network neutrality for the purpose of serving up a preferred music service that locks you into that ISP.  Apparently, no one who put together the study contemplated the fact that this might <i>piss people off</i> and make them look for ISPs that don't lock them in.  Thankfully, it appears that some ISPs aren't biting:
<blockquote><i>
"TalkTalk thanks the BPI for its strategic business advice. Though some may question the value of such insight from an industry which has failed to acknowledge the impact of new technology on its own business models and is pressing the Government to criminalise its biggest customers," a spokesperson told TorrentFreak.
</i></blockquote>
Exactly.  If the record labels were really serious about helping ISPs offer up music services, they wouldn't be blocking them at every turn.  This report is a typical red herring.<br /><br /><a href="http://www.techdirt.com/articles/20100308/1855408466.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100308/1855408466.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100308/1855408466.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>neutrality?</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100308/1855408466</wfw:commentRss>
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<item>
<pubDate>Tue, 2 Mar 2010 12:43:39 PST</pubDate>
<title>Spanish Indie Labels To Sue The Gov't For Not Stopping File Sharing</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100302/0237008356.shtml</link>
<guid>http://www.techdirt.com/articles/20100302/0237008356.shtml</guid>
<description><![CDATA[ We've discussed recently how Spain seemed to be one of a very small number of countries whose legal system seemed to be doing a decent job <a href="http://www.techdirt.com/articles/20091120/1152097027.shtml">in responding to copyright issues</a>.   It has <a href="http://www.techdirt.com/articles/20090623/1918135337.shtml">rejected three strikes</a>, said that <a href="http://www.techdirt.com/articles/20091118/0900316987.shtml">broadband is a basic right</a>, said that <a href="http://www.techdirt.com/articles/20090531/2312145072.shtml">personal file sharing is legal</a> and even <a href="http://www.techdirt.com/articles/20091124/1920017075.shtml">fined "anti-piracy" groups</a> for "bad faith actions."  Of course, all of those reasonable moves have made Spain something of a target.  Industry lobbyists have convinced the government to <a href="http://www.techdirt.com/articles/20091202/1152477163.shtml">propose new copyright laws</a>.
<br /><br />
But it's not just the big entrenched players.  Reader Tor sends over the troubling news that a group of indie labels in Spain <a href="http://login.vnuemedia.com/bbbiz/content_display/industry/e3ib50641aa28f3a4608304fbf3fc77c63f" target="_blank">are <i>suing the government</i> for "negligence" in failing to stop file sharing</a>.  Specifically, they're really upset about the rulings that have found personal, non-commercial file-sharing is legal.  They want the right to sue their biggest fans.  Apparently, they haven't been paying attention to how that's worked (i.e., it hasn't) elsewhere:
<blockquote><i>
"The measure would not resolve the most relevant problem, which is the actual impossibility of us taking civil action against those final users who appropriate music without paying, and systematically violate intellectual property rights," he adds.
<br /><br />
"We think the Administration is responsible for our plight," says Carton. "We demand that the government take effective measures imminently to protect the rights and interests of the record industry, as well as the intellectual property rights of the agents that intervene in the creative musical process within Internet."
</i></blockquote>
This is pretty disappointing.  Last year, I actually bought a bunch of CDs (yes, physical CDs) from an indie label in Spain that I only heard about after a friend sent me some MP3s suggesting I might like a couple of the bands on the label.  After checking out their websites (and being able to listen to some of the songs) I ended up ordering a bunch of CDs from the label.  Just last week, I bought two more albums (downloads, via CDBaby) from the same label.  Yet, according to these labels (and I can't tell if the label whose CDs I purchased is part of the lawsuit), they would have been better off suing my friend.  Indie labels should be leading the way here: focusing on giving fans real reasons to buy, rather than suing the government for not putting up more protectionist barriers to pretend it can hold back what the technology allows.<br /><br /><a href="http://www.techdirt.com/articles/20100302/0237008356.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100302/0237008356.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100302/0237008356.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>that's-one-strategy</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100302/0237008356</wfw:commentRss>
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<item>
<pubDate>Wed, 20 Jan 2010 22:41:00 PST</pubDate>
<title>Wiggling Their Way To Musical Success Without A Label</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100119/1134507815.shtml</link>
<guid>http://www.techdirt.com/articles/20100119/1134507815.shtml</guid>
<description><![CDATA[ Again, no one is saying that there's no place for music labels any more -- in fact, we think there's a huge place for them if they can help a band that doesn't want to build a business by itself.  However, for bands that are willing to go entirely without a label, it's certainly possible to be a success (and, before someone misinterprets this, no one is saying success is guaranteed either).  Tim Lash points us to a CNN <a href="http://money.cnn.com/2010/01/18/smallbusiness/wiggles_how_we_got_started/index.htm" target="_blank">interview with <i>The Wiggles</i></a>, the massively popular pop band for toddlers.  The whole interview is interesting, but the most interesting part is the explanation of how the band went it alone.  Two of the original members had been on a label-signed band before (The Cockroaches) and knew they didn't want to go through it again -- even though this was in the early 1990s, before the web and before all these alternatives had sprung up:
<blockquote><i>
The model for nearly everything we do is self-financed. We own everything and create it ourselves.
<br /><br />
We wanted to keep financial and creative control. The Cockroaches' record label had taken some control over their work, and we wanted to avoid that type situation. With our background, we know what's good for children and what's best for The Wiggles. No one else had done what we were doing.
</i></blockquote>
While it sounds like, early on, the band handled the business on an ad hoc basis, they later got help from some business managers who have helped to guide the band's strategies over the years.
<br /><br />
Of course, as with all of these examples, someone will certainly pop up in the comments and complain that there's nothing new or different about this story.  And that's true.  But that's the point.  All of this <i>could</i> have been done years before, but it was much more difficult.  What modern technology has done is made it much easier for musicians to control their own destiny, if they decide that's what they want to do.<br /><br /><a href="http://www.techdirt.com/articles/20100119/1134507815.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100119/1134507815.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100119/1134507815.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>it's-not-needed</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100119/1134507815</wfw:commentRss>
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<pubDate>Fri, 4 Dec 2009 15:02:43 PST</pubDate>
<title>UK Record Label Boss Resigns From BPI/IFPI Committees Due To Mandelson's Digital Economy Bill</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20091204/1128277207.shtml</link>
<guid>http://www.techdirt.com/articles/20091204/1128277207.shtml</guid>
<description><![CDATA[ BPI and IFPI, lobbying groups that represent record labels, have been major supporters of Peter Mandelson's Digital Economy Bill, that will grant him powers to change copyright law at will, and to kick people off the internet based on accusations (not convictions) of file sharing.  However, it appears that at least some record labels are realizing what an incredibly bad idea this is.  <a href="http://twitter.com/EFF/statuses/6344881324" target="_blank">EFF</a> points us to the news that the boss of indie label Pure Mint Recordings <a href="http://newsblog.thecmuwebsite.com/post/Pure-Mint-boss-resigns-BPI-committee-over-Digital-Economy-Bill.aspx" target="_blank">has resigned from both the BPI and IFPI committee's he was a part of</a>, citing his opposition to the Digital Economy Bill, and both organizations support of the bill:
<blockquote><i>
Hall believes the proposed legislation has been rushed in a bid to get it through parliament before the next General Election, that it is in danger of disregarding some sacred legal principles (regarding process, presumption of innocence and burden of proof) and that it won't solve the record industry's piracy problems anyway.
 <br /><br />
In his resignation letter to the BPI, Hall writes: "I have enjoyed contributing to both [the BPI's] Rights [Committee] and the [IFPI's] ILC, but increasingly feel that my contributions are falling on deaf ears as an agenda has already been reached that I now consider is unmovable. As you know, I do not think the Digital Economy Bill is a sensible or well thought out piece of legislation. In my view it is being rushed through the last months of a parliament of an unpopular government and it is not legislation that I support".
 <br /><br />
Referencing clause 17 - the one that gives senior ministers the right to change copyright laws on whim - he continued: "I am particularly surprised that the record industry has chosen to endorse s.17 of the DEB, which I consider is wholly undemocratic and contrary to centuries of good practice regarding the forming of our copyright legislation. I also believe it may set a dangerous precedent going forwards (and could come back to haunt the industry)".
</i></blockquote><br /><br /><a href="http://www.techdirt.com/articles/20091204/1128277207.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20091204/1128277207.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20091204/1128277207.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>speak-with-your-feet</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20091204/1128277207</wfw:commentRss>
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<pubDate>Tue, 4 Aug 2009 08:17:00 PDT</pubDate>
<title>Yet Another Music Business Model: Label Signs With A Band</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090802/1549165740.shtml</link>
<guid>http://www.techdirt.com/articles/20090802/1549165740.shtml</guid>
<description><![CDATA[ One of our regular critics here claims that part of what I talk about is killing off the record labels.  Nothing is further from the truth, of course.  I've spoken repeatedly about how I think there's still a tremendous space for smart record labels that get it to <a href="http://www.techdirt.com/articles/20080318/173833576.shtml">help musicians out</a> in <a href="http://www.techdirt.com/articles/20090621/1626125300.shtml">enabling</a> these new business models.  Some musicians may be able to do everything themselves, but I think most will end up in a partnership of some kind.  That's also why I've discussed some <a href="http://www.techdirt.com/articles/20090707/0402555472.shtml">newer labels</a> that I think are doing unique and powerful things to enable artists to better connect with fans, and give those fans a reason to buy.
<br><br>
When I've pointed that out, however, some have responded that this just means I want the same status quo as before.  But, again, that's incorrect.  The way things <i>used</i> to be, was that the major record labels had <i>all</i> of the power.  You basically had to sign a major record label deal to get anywhere, and since there are just a few majors, you were pretty limited -- and all of them took advantage of artists.  They could do that because they had all the power, and they had a business model that only worked by putting ridiculous and oppressive terms on most artists, guaranteeing that few ever saw anything beyond their advances.
<br><br>
The big difference today?  Thanks to new technologies and new avenues for both connecting with fans and transacting with them, the major labels don't have the same sort of power any more -- and artists can actually take back many of their rights, whether it's retaining the copyright on their songs, or negotiating deals that don't seem quite so much like indentured servitude.
<br><br>
And, in fact, we've been seeing more and more of that lately, with newer labels taking a much more innovative, musician-friendly, fan-friendly approach to things.  Ian Rogers has a fascinating post that shows at least one situation, where the power structure has certainly shifted, as he read about how <a href="http://www.topspinmedia.com/2009/08/label-signs-to-artist/">a label, Duck Down, had signed to Blue Scholars, a band</a>.  Note the direction.  It wasn't that Blue Scholars had signed a label deal with Duck Down.  Instead, Blue Scholars figured out a <a href="http://blogs.seattleweekly.com/reverb/2009/07/duck_down_signs_to_blue_schola.php" target="_new">unique way to finance, promote and distribute its latest album</a>.  First, they did a deal with Seattle's Caffe Vita Coffee to finance the album, and to handle local distribution.  The band is retaining all the rights to the music with control over how it's marketed and sold (and, they note, "given away").  Duck Down, though has been "hired" to help with the marketing.
<br><br>
This makes a lot of sense.  Certainly record labels have a lot of experience and connections when it comes to marketing music and musicians.  So leveraging those relationships makes a lot of sense.  Giving up all control and rights just for that marketing expertise, on the other hand... makes less and less sense.  So, no, I don't think record labels are going away.  I still think there's plenty of room for them in the wider music ecosystem.  But their role is changing, and the power shift is moving much more to artists and away from the labels.  Some of the smart ones get it.  But a few of the major labels certainly don't like this, which is why they fight so hard against the technology that's making this happen.<br /><br /><a href="http://www.techdirt.com/articles/20090802/1549165740.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090802/1549165740.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090802/1549165740.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>fantastic</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090802/1549165740</wfw:commentRss>
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<item>
<pubDate>Fri, 19 Jun 2009 11:42:00 PDT</pubDate>
<title>So Why Can't Major Record Labels Provide Accurate Accounting To Bands?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090619/0323015288.shtml</link>
<guid>http://www.techdirt.com/articles/20090619/0323015288.shtml</guid>
<description><![CDATA[ The more you learn about the way major record labels work, the more ridiculous it seems.  Unlike pretty much <i>every</i> other creative deal making situation, musicians who sign major record label contracts basically hand over <i>all</i> their rights to the label.  The label gets the copyright.  It gets to determine the type of music the musician plays.  It handles much of the marketing and promotion.  And... the biggest thing of all is that it handles all the accounting and payments (if there are any).  Over the years, that's resulted in many, many accusations from artists that the labels are flat out lying about how much an artist actually earns.  That's why you hear stories of artists selling millions of albums and <a href="http://www.techdirt.com/articles/20080711/1439371651.shtml">never seeing a dime in royalties</a> or of artists <a href="http://www.techdirt.com/articles/20090602/2308085105.shtml">suing record labels</a> because of sneaky accounting tricks to hide how much an album has earned.
<br /><br />
Dave Stewart, from the Eurythmics, has written an article for Billboard where he points out that any retailer in the world has <a href="http://www.eurythmics.me.uk/blog/?p=1657" target="_new">access to amazingly detailed technology and tools</a> to track transactions and settle details with credit card company merchant accounts.  He notes how ridiculous it is that such systems have been available for nearly thirty years... and he still can't get an accurate transparent accounting of what a record label has sold.
<br /><br />
In the past, the major labels could get away with this, because they were the only real game in town, if a band really wanted to get big.  But that's changing.  This, of course, is the major labels <i>real concern</i> over new innovations and technology.  It's not piracy.  It's that new technologies take away the biggest scam they've had going for ages: the ability to keep tons of money that never belonged to them.  And that's changing.  As Stewart notes:
<blockquote><i>
In the future, all incoming revenue streams will be reported in real time, with transaction costs pre-defined and competitive with the market.  In the old model, content distributors have been slow and/or reluctant to adopt new media.  Distributors frequently take significant portions of creative control out of the hands of the artist, placing restrictions on format, functionality, interactivity and other components. Copyright controls inherently limit the models and methods of release and distribution of artist products.  Digital distribution and rights management methods have failed to leverage technological and business advancements to serve consumer, artistic and corporate interests. With many distributors, the feedback loop on consumer usage is also limited.  Buyer profiles, habits and usage patterns are not shared with artists, who are then forced to use other means (surveys, focus groups) to determine how their content is being received by the fan.  Especially troubling is that, in many cases, artists are not entitled to any control over precisely what happens with their creative work, or to apply some of the new and innovative ideas in the digital landscape due to restrictions from rights holders.  Digital media technologies for distribution, asset management, security and monetization have matured to the point that an easy-to-use, scalable, fully featured digital media gateway and financial tracking system is now possible and should be demanded by all artists.
</i></blockquote><br /><br /><a href="http://www.techdirt.com/articles/20090619/0323015288.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090619/0323015288.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090619/0323015288.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>because-that-would-mean-paying-them-accurately</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090619/0323015288</wfw:commentRss>
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<pubDate>Mon, 30 Mar 2009 11:52:22 PDT</pubDate>
<title>So Only When Piracy Gets Really Bad Will Record Labels Change Their Act?</title>
<dc:creator>Carlo Longino</dc:creator>
<link>http://www.techdirt.com/articles/20090330/1001534306.shtml</link>
<guid>http://www.techdirt.com/articles/20090330/1001534306.shtml</guid>
<description><![CDATA[ Google is today <a href="http://www.nytimes.com/2009/03/31/technology/companies/31music.html?partner=rss&emc=rss&pagewanted=all" target="_new">launching a free, ad-supported music service in China</a>, with the backing of more than 140 record labels, including the Big 4. The service sounds like exactly the sort of thing that people have been calling for since the Napster days: a search engine linked to a trove of music files, supported by advertising. Google's <a href="http://techdirt.com/articles/20080801/1714001868.shtml">wanted to add</a> some sort of music search to its Chinese product for some time, as it's been at a significant disadvantage to rivals like Baidu, which have the feature <a href="http://techdirt.com/articles/20080915/0150502269.shtml">to thank</a> for much of their success. The record labels say this is the first attempt to monetize online music in China, and mirrors moves by <a href="http://techdirt.com/articles/20081104/0202512734.shtml">some movie studios</a> to compete with piracy there with new products and services, rather than through lawsuits and lobbying. These efforts always give a nod to the rampant piracy going on in China -- acting as if it's a completely different environment than the rest of the world. So is the lesson here that only if piracy, or at least the labels' and studios' perceptions of it, gets "bad enough", will they do something positive, rather than sue people or try to get laws strengthened in their favor? Or is it only because those aren't viable options in China that companies try something different there? The fact that the labels are moving forward with this plan in China, given its reputation as the wild west of copyright infringement, undermine their contention that they can solve the supposed piracy problem with legal or technological means elsewhere. Furthermore, it exposes the reality that what's staring them in the face is a tremendous opportunity, not a problem.<br /><br /><a href="http://www.techdirt.com/articles/20090330/1001534306.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090330/1001534306.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090330/1001534306.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>just-wondering</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090330/1001534306</wfw:commentRss>
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<pubDate>Fri, 13 Mar 2009 18:48:00 PDT</pubDate>
<title>Terry McBride: Songs Are Not Copyright.  Songs Are Emotions</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090311/0432524073.shtml</link>
<guid>http://www.techdirt.com/articles/20090311/0432524073.shtml</guid>
<description><![CDATA[ Last year we wrote about a fascinating <a href="http://www.techdirt.com/articles/20081211/1941213099.shtml">interview</a> with Terry McBride, the CEO of Nettwerk Music, a Canadian record label that has proven to be quite innovative with its business models (and quite successful).  He's really focused on helping musicians build up valuable brands, and then being able to make money off of those brands by being consumer-friendly, rather than consumer-antagonistic.  One of the examples mentioned in that interview was a new album coming out where before the album was even released, the raw files were put online for fans to download and mix themselves.  As he said, it wasn't "remixing," it was "premixing."  And, the plan is to take the best of those and release the actual album in two formats: the official mix and the best fan mixes.
<br /><br />
There's now another interview with McBride at the Future of Music site where he <a href="http://www.futureofmusicbook.com/2009/03/04/terry-mcbride-of-nettwerk-interview/" target="_new">talks more about his vision</a> of a music future where people effectively pay not for the music, but for the convenience of a "music valet" that does a better job organizing and finding the music you want when you want it.  I'm still not convinced this is how things eventually work out, but it's certainly worth thinking about.
<br /><br />
However, there are few statements McBride makes that are worth highlighting.  First are two statements I agree with, and then one I don't:
<blockquote><i>
People have always been sharing music. Why would I want to stop them? Why would I want to tell them what to do? The way to win was to get them to support my artists, not to force them to do it a certain way. I know I wouldn't like anyone telling me that.
</i></blockquote>
This is a huge point that is so often missed by those in the industry who are focused on "protecting" and "control" rather than recognizing how people <i>want</i> to interact with musicians.  The thing that I find most ridiculous from those complaining about file sharing is that they always make some statement along the lines of, "people who are sharing my files aren't fans, because real fans spend money."  Of course, if that's true, what's the problem?  The people who aren't fans aren't paying and (based on that statement) the real fans will pay.  So, there's no problem at all...
<blockquote><i>
Songs are not copyright. Songs are emotions. 
</i></blockquote>
Indeed.  And that's the point.  Do people pay for emotions?  No.  However, emotions will impact what people will pay for.  However, despite agreeing with McBride on so much, I think he goes a bit off-track with the following:
<blockquote><i>
Out of all of the sharing of music, who's making an economic return? Whoever is should then share that with all the people that allowed it to happen, creating a nice alignment of interests to grow any business. A lot of the providers have viewed music as free content, while at the same time paying for the cable content to grow their networks. They've been making money off the backs of the artists without any compensation for the artists at all. I think that's fundamentally wrong. I've also said it's fundamentally wrong to go after the consumers that are using that opportunity. That's not the right approach either. The phone companies and the cable providers have gotten away with murder in this whole situation.
</i></blockquote>
This is the blame game and it's missing the point.  The ISPs haven't "gotten away with murder."  They've simply put in place a reasonable business model based on fundamental economics -- and there's nothing stopping plenty of others in the music business from doing the same.  Demanding those who have figured out how to make money share with those who haven't isn't the answer either.   There are business models that work just fine for those creating the music that don't require demanding anyone else share their profits.  You just focus on coming up with real scarcities that give people or companies real reasons to buy and there are tons of business models that work.<br /><br /><a href="http://www.techdirt.com/articles/20090311/0432524073.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090311/0432524073.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090311/0432524073.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>getting-there...</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090311/0432524073</wfw:commentRss>
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<pubDate>Fri, 12 Dec 2008 19:40:00 PST</pubDate>
<title>Terry McBride Explains How Nettwerk Puts Fans In Control</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20081211/1941213099.shtml</link>
<guid>http://www.techdirt.com/articles/20081211/1941213099.shtml</guid>
<description><![CDATA[ Mark Glaser has an absolute must-read <a href="http://www.pbs.org/mediashift/2008/12/nettwerk-ceo-terry-mcbride-puts-fans-in-charge-of-bands346.html" target="_new">interview with music label Nettwerk's CEO Terry McBride</a>.  Nettwerk, of course, has been one of a few record labels that <a href="http://www.techdirt.com/articles/20060825/095653.shtml">really understands</a> how the market has been changing, and has moved aggressively to take advantage of that.  The label, which represents some top artists like Coldplay, Barenaked Ladies, K-OS and Avril Lavigne, got a lot of press a couple years back when it agreed to <a href="http://www.techdirt.com/articles/20060126/2025216.shtml">pay for the defense</a> of some folks who were sued by the RIAA for file sharing.  But, much more interesting was how it was actively embracing the changing market while other record labels were trying to hold back the tide.  I don't agree with everything McBride has to say, but he's a <i>lot</i> closer to understanding where the music market is heading than pretty much everyone else we've seen in the recording industry.
<br /><br />
You should really read the entire interview, but a few highlights are things like where he points out that musicians and record labels should be selling the overall <i>brand</i>, not the music:
<blockquote><i>
In the digital space, where you don't need to buy shelf space, if you create the right metadata behind what you're doing, and market it in an effective way -- you're not marketing the new album, you're marketing the brand.... Chad [Urmston of State Radio] just played to 2,800 people with a $25 ticket price in New York on the weekend. He's marketing a brand, he's not just marketing intellectual property. Now it all makes sense. He's happy, he owns his future, his audience has grown with him really well.
</i></blockquote>
Which brings up the second key theme: growing the audience and having them connect more closely with the musicians, even to the point of having some say in what direction the band goes in.  For example, he talks about originally letting fans design the t-shirts the bands would sell.  While some band members didn't like the fan-designed shirts, they inevitably sold more than the band-designed shirts.  So, they started taking that even further: releasing versions of the bands' music online for fans to remix.  And, with the latest K-OS album, even releasing all the musical stems for remixing, months <i>before</i> the actual album is released, with a plan to then release both the artist mix <i>and</i> the best fan mixes as both physical and digital offerings:
<blockquote><i>
You can even take it beyond that. With K-OS, we're thinking about having the audience vote on which 10 to 12 cities he plays in Canada. We might even take it one step further: pay as you go not as you enter. And maybe when you leave you get a copy of the fan mix for your donation, so there's karma pricing on the exit.
</i></blockquote>
McBride also talks about where he thinks this is all going to end up, and he discusses a model that <i>might</i> sound sort of like the <a href="http://www.techdirt.com/articles/20081209/0144083060.shtml">music tax</a> we've been slamming, but in reality it's quite different:
<blockquote><i>
To me, the future of music is really simple. It's cloud-based servers that have all of the music, TV, movies -- whatever it might be. Very rich application-driven PDAs, whether it's the iPhone or whatever else comes up, that has applications that I have yet to see. Like digital maids or valets, which go out and knows what your musical tastes are and your 20 friends, and finds that music and organizes it -- not the actual music but the metadata so you can pull it when and how you want it. You would have a $5 or $10 per month fee for pulling it down. And that's how it will all end up, because business cannot drive business consumption.
<br /><br />
How free loses out is the applications and metadata that makes it really easy. I call it the "hassle factor" -- for $5 to $10 you get all the music you want without the pain of having to find it. So you get the new Killers album without even knowing the new Killers album is out, and it's automatically in your weekend listening folder because your digital valet got it for you. And if you want to know what your buddy Ken's listening to, then the valet checks out his playlist and copies it over for you.
</i></blockquote>
I could see this happening to some extent.  The difference between this and a music tax is (a) it's totally voluntary (b) it's about adding value beyond "free" that makes it worth paying and (c) what you're really paying for is actual scarcities: convenience and pointers to good music you'll really like.  Of course, in the end, my guess is that eventually this would go one step further, where the service itself would be free, because musicians would find so many other benefits from being promoted through such a system (increased ticket sales, fan club subscriptions, etc...) that it would make even more sense for the whole system to be free.
<br /><br />
Anyway, it's great to see real progress being made on business models in the industry, and this actually highlights (once again) why Warner Music/Jim Griffin's music license system just isn't necessary.  The market is making things work without it.  In fact, the key quote from McBride may highlight why Nettwerk is getting somewhere while so many of the old school labels are having trouble:
<blockquote><i>
It's a business model and not a consumer model. And it's definitely not a psychological model. This is about monetizing consumer behavior and not about trying to control where they go.
</i></blockquote>
He's talking specifically about "ad-supported" music, which I agree is a model that will never get very far, but the same thing pretty much applies to the old record label model, as well.  These days, when there are real consumer <i>options</i> out there, you don't succeed by limiting what consumers do, you succeed by enabling them to do more.  And, that seems to be exactly what Nettwerk is doing.<br /><br /><a href="http://www.techdirt.com/articles/20081211/1941213099.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20081211/1941213099.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20081211/1941213099.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>consumer-models,-not-business-models</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20081211/1941213099</wfw:commentRss>
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<pubDate>Thu, 7 Feb 2008 12:58:00 PST</pubDate>
<title>Major Labels Under Antitrust Investigation</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20080207/073755196.shtml</link>
<guid>http://www.techdirt.com/articles/20080207/073755196.shtml</guid>
<description><![CDATA[ Apparently the Justice Department is suddenly worried that the four major record labels are <a href="http://www.theregister.co.uk/2008/02/07/universal_sonybmg_antitrust_report/" target="_new">colluding in creating a new online music subscription service</a>.  The last time this happened was back when the record labels tried to (wait, this sounds familiar) create online music subscription services -- which were universally <a href="http://www.techdirt.com/articles/20011220/1034207.shtml">panned</a>, rarely used and eventually shut down.  So, even if the labels are colluding, given their <a href="http://www.techdirt.com/articles/20071127/011720.shtml">strategic vision</a>, it seems rather unlikely that they're going to leverage their position to dominate the market.  They certainly could hold back other services -- but it seems like they've been doing that for years already, just with their own shortsightedness.<br /><br /><a href="http://www.techdirt.com/articles/20080207/073755196.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20080207/073755196.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20080207/073755196.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>yet-again</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20080207/073755196</wfw:commentRss>
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<pubDate>Thu, 11 Oct 2007 02:51:34 PDT</pubDate>
<title>Next Up To Ditch Record Label: Madonna</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20071011/005432.shtml</link>
<guid>http://www.techdirt.com/articles/20071011/005432.shtml</guid>
<description><![CDATA[ It's been quite a bad month for the record labels, huh?  Kicked off by Radiohead's <a href="http://techdirt.com/articles/20070930/214524.shtml'>announcement</a>, a bunch of other bands have all been publicly <a href="http://www.techdirt.com/articles/20071008/154529.shtml">ditching</a> record labels in order to embrace the new business models that the record labels insisted were dangerous to the industry.  In retrospect, it looks like they were just dangerous to the record labels (gee, who could have <a href="http://www.techdirt.com/articles/20050330/025236_F.shtml">predicted</a> that?).  The latest huge name to ditch a record label appears to be Madonna, who is apparently <a href="http://www.nytimes.com/2007/10/11/business/media/11madonna.html">signing a huge deal with a concert and merchandise promoter</a> instead for over $100 million.  She'll still be putting out albums through the promoter rather than the label.  There's no indication if she's going to use this to free up some music, but the point should be pretty clear.  The money is in concerts and merchandise -- the stuff that the music makes valuable -- not in the music itself.  While EMI's new owners have made some <a href="http://www.techdirt.com/articles/20071009/191057.shtml">noises</a> that maybe they understand what's going on, there's a good chance that it's way too late for the old labels.  They had their chance to embrace fans, new technology and the music itself -- and they spent 8 years suing the fans and the technology instead.  It's reached the point that college kids are now organizing to <a href="http://www.nytimes.com/2007/10/10/education/10students.html?ref=education">protest the RIAA</a>.  It's becoming increasingly clear that the labels weren't helping musicians very much either -- and now it appears to be payback time.  This isn't the "fault" of piracy.  This is the fault of shortsighted recording industry executives who had every chance to understand the <a href="http://www.techdirt.com/articles/20070503/012939.shtml">economics</a> at play and instead chose to attack everyone (and there were lots) who pointed out to them where the market was going.<br /><br /><a href="http://www.techdirt.com/articles/20071011/005432.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20071011/005432.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20071011/005432.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>quite-a-week</slash:department>
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