Royalty Agreements Holding Up Necessary Change In The Music Industry
from the need-a-clean-break dept
Eliot Van Buskirk over at Wired’s Listening Post has an interesting article about the latest music royalty battle: focused on royalties for songwriters and music publishers. He likens it to the TV writer’s strike issue, and sides with the songwriters, noting that the recording industry needs to encourage songwriters to write good songs, and stiffing them won’t help. However, I disagree that the best way to do this is to agree to what the songwriters are asking for — which is a larger defined cut of any use of their songs. Just as the TV writers are wrong in pushing for an extra cut of internet revenue, the same is true in this situation. Yes, in both cases, it’s totally understandable and reasonable to feel sympathy for the writers — who are often squeezed out of money and treated unfairly by the big entertainment companies. I’m not denying that at all. However, it’s the very structure of this compensation that’s going to cause more harm than good in the long term. It will limit the options for the entertainment companies, and allow others, not tied to those legacy agreements, to run rings around them. It provides a crutch for the songwriters, allowing them to lean on that, rather than embrace important new business models. These types of agreements will only slow down the adoption of new models and will only make it less likely that people can earn a living from writing either TV shows or music.
Why? Well, with regards to music, the trend is clear that the music world itself is increasingly moving towards free music. That’s just basic economics at work. Yet, by tacking on a defined royalty on each download or streamed song, it makes it much harder for anyone tied into that royalty system to actually embrace the opportunities that free music provides. And if you recognize that those opportunities are likely to be even larger than the existing market, then by agreeing to these royalty payments, the songwriters are actually limiting their own market potential. In the end, all it does is artificially inflate prices, leaving more efficient and innovative solutions to route around the existing songwriters, rather than rewarding them. Just like everyone else, songwriters will need to learn to change the way they’re compensated. Trying to inflate the old, obsolete system won’t help things. It will only make it that much more difficult for the entire industry to change.
One other aside on all of this. In the comments, more than a few times, we’ve had discussions where people have suggested that the models we’ve discussed wouldn’t work for songwriters, specifically, claiming that the old system is fine, but any new system would never work — ignoring the many ways it could work (using a straightforward pay-for-hire setup, for example). However, it’s interesting to see that relying on the supposedly “successful” old model is starting to come under stress from everyone else in the industry. It highlights, once again, that when we talk about these models, it’s silly to compare the “old way” and any “new way.” It’s more important to recognize that the old way just isn’t sustainable. You need to compare the new models to what the old models are trending towards.