Musicians vs. RIAA At USA Today

An anonymous reader writes "USA Today has an article about the growing friction between recording artists and the 5 major labels which make up the RIAA. Many issues are covered, including copyright reform, fraudulent accounting on the part of record labels, and how selling a quarter million albums can leave you owing your label $14,000."

Time to seek alternatives.

[OrangeSpyderMan]

An interesting article by all means. Perhaps the time has come for all artists, new upcomers or old timers, to seek an alternative distribution model. I have often thought, considering the very slim royalties most performers receive from CD sales, that simply selling tunes direct to the customer on a website could put the power back where it belongs - in the hands of the people who have the talent.

Re:Wait a minute...

[Rader]

Maybe it's just taking the artists longer to figure out what's going on. And definately a while to figure out what to do about it.

It's like being screwed by your landlord. You know you don't like it. You should leave. But where will you live?

It should be interesting as these multi-year contracts start to run out, and artists start to look for other solutions. (Unfortunately there aren't any other great solutions. Most of the good ones lack any real marketing) With sales not increasing, and artists speaking up, the Big-5 might actually have to do something.

Or maybe not. I'm sure there's always another "Korn" willing to sign their lives away for fame.

Re:Easy

[pyite]

Short anecdote: This June, I'm driving to Connecticut from Jersey in ridiculous rain. I stop at a Mobil gas station and go inside to get a coffee. It's dark, rainy, etc. I walk up to the door and look at the guy leaving as I'm going in. I go, "Mike?" He says, "Yup" and walks away. It happened to be Mike Gordon (coincidently look at my sig) from Phish, driving himself somewhere in a ragged T-Shirt and jeans. Now, here's a band that has untold gobs of money and yet still drive themselves around and don't really care what they look like. Here's also a band that gives away its music to any who would want to hear it. This is the kind of band the RIAA is scared of because they don't act greedy like the RIAA themselves.

Hmm, never thought of it like this...

[daoine]

Sen. Orrin Hatch, R-Utah, once stated that the record business is the only industry in which the bank still owns the house after the mortgage is paid.

I never thought of it like this before, but that's really what happens. What's worse - there's nothing more frustrating than a band changing labels -- the old label still owns all the band's old music, which unfortunately means that they take some pretty good stuff and stick it in a basement somewhere. This is where Janis Ian's suggestion of letting artist re-release their out-of-print stuff would really be of use. Of course, that would require the RIAA to give up some control...

Leann Rimes

[Anonymous Coward]

Boy, did she get screwed.

First, her parents signed her up with Curb Records for TEN albums when she was 12. She grossed over $300,000,000 for Curb Records. That's right, a third of a billion dollars.

When her parents got divorced, her mom got to ride horses with the WalMart heirs, her dad lives in luxury, and Leann has enough to buy herself a used car.

There are laws that are supposed to protect child stars from getting fucked like this. There isn't a single honest judge to enforce them, though. Leann is suing her dad, her label, and probably her mother, agents, and promoters. It's the judges that will do her in.

Re:Time to seek alternatives.

[zenasprime]

Even with a web presence, it is very difficult to sell anything on the internet. One must constantly be selling themselves and their product at every step. For the musician, this requires getting out and doing shows. Small shows are relatively easy to come by, but larger venues are not. What musicians need to to work together to promote themselves and others that they feel promote their style of music. In otherwords, it requires a lot of hard work and ass kissing, which might not be something most people are willing to do. However it is possible, the Offspring are evidence to that. Unfortunately, most musicians suffer from "rockstar" syndrome, and do not want to work and instead only think about the trappings that stardom will give them rather then producing music that moves people.

z(p)

http://www.zenapolae.com --- our independent record label

Fear the Parrot!

[gunnk]

If Jimmy Buffett has his way (and looks like he is attracting some takers), the RIAA has more to fear from J.B. than from P2P. Check out this article [sfgate.com] on Buffett leading the charge against the big labels. With CD's cheap and easy to make, the RIAA and the big labels that make it up are going to have a harder and harder time justifying their existence. They can keep blaming P2P, but they'd better wake up to the fact that they can't keep treating their artists and customers like dirt -- the artists and customers CAN and WILL get together with or without them. I'm mad as hell, and I'm not gonna take it anymore -- from Fruitcakes by J.B.

source of bad music?

[jeffy124]

the article says that labels tend to contract 6-8 albums for an artist to produce. I wonder if this is a source of the poor music that has been coming out in recent years. Some artists may simply have one or two hits at the start of their career, getting the attention the labels, thus signing the artist. Then it turns out that the artist, having to roll out that many albums, does not have the talent in them to come up with enough good tunes that people want, leading to a decline in CD sales. All the one-hit-wonders are the ones getting signed by the big labels before the realization that they are one-hit-wonders.

Re:Wait a minute...

[tmark]

Moreover, if they're really getting shafted like they think they are, why doesn't such a glittering roster of blue-chip stars get together and finance their own record company, where they can control things ? SURELY, together they could do something like Spielberg/Katzenberg/Geffen did when those guys cut out their middlemen ?

It does make one wonder. We're not talking about dime-store independent artists here.

Re:source of bad music?

[jolshefsky]

One of the things to consider is that these contracts also limit the artist from changing at all. They have to play the same kind of music and still produce hits. They can't change styles, or replace members with someone who sounds different, or change the instrumentation of the band, or change the sound of the lead singer ... all these things can really stifle creativity.

Imagine if Vincent van Gogh got stuck in a contract where he had to produce 6-8 paintings but all of them had to look and feel just like Starry Night. The guy probably would have become depressed and killed himself.

The greater evil

[Rader]

.....Though accused of conniving tactics behind the scenes, Rosen publicly extends an olive branch to detractors. "I'm glad the artists are organizing," she says. "It's good for the industry. We want to resolve our disagreements and move on to other critical matters, especially piracy. We're on the same side in 99% of the issues....

Oh great. That will be the solution. Blame the pirates for all their problems. Yet another act of misdirection.

I feel that this will all get settled over one small addition to the contracts (like limiting their indentured servant status to "only" 7 years) and then it'll be business as usual. (Basically buying more legislation so that in a few years we're at a pay-per-play market)

Financing Bands Through IPOs/stocks

[Anonymous Coward]

And today on NYSE, NOFX is going public...

but seriously, why not? Just like you buy stocks if you feel a corporation will strike gold, would it not make sense to do the same with music ?

support the artist not the label(if you like them)

[intermodal]

Many issues are covered, including copyright reform, fraudulent accounting on the part of record labels, and how selling a quarter million albums can leave you owing your label $14,000."

Meanwhile, at the bottom of the article page, it says "Blessed is he who expects nothing, for he shall never be disappointed. -- Alexander Pope"

very fitting.

See, this is why i don't buy anything from the RIAA anymore, aside from the fact that I don't want my money going to fund copyright laws that I don't want. If i want to hear them bad enough, I'll go see them when they come to town, if I hear about it, since I don't listen to the radio...but thats what band websites are for.

Re:Wait a minute...

[RazzleFrog]

Probably because they are under 7 or 8 album (read lifetime) contracts and their older music is being held hostage by the record companies (both the recordings and the songs themselves).

It could also be because these musicians don't nearly have the selling power of the pop-crap that has infected today's music scene and the pop-crap musicians aren't yet motivated to leave the labels.

Problem is of consumer's making

[ndvaughan]

I feel for the artists--especially the ones who have a steady following and are great musicians but get dropped because they don't appeal to the "MTV generation". But it's our own fault. We rely too much on radio and TV to influence our tastes and who we listen to. I once thought there was a big, untapped resource of music-lovers who really want to hear the stuff that's not on the radio--people who want only quality musicianship and a unique sound, but things like jazz (the only truly American music form) and classical have never been big sellers, even with the older demographic.

Face it, most people want to hear the stuff that's on the radio-- over-produced, simplistic, commercialized goo, and we can't stand if it's not a singable tune. That's why only 5% of the artists have a hit-- because the record companies know they can't make money unless they find a musician who happens to fit that (very rare) formula. Even if they do sign an innovative group or individual, they know hardly anyone will buy the record, because they know we have horrible taste, or that we, for whatever reason, are less likely to buy it.

I work at a music store, and 99% of the requests I get are for musicians who they heard on the radio or TV. People want to be hand-fed good music, then complain when it's not good. The record companies are only trying to feed the customer what they seem to want, which is not necessarily good music.

How about this for a ridiculous contract term?

[droopus]

I was a record producer for fifteen years and got out of the business because it simply sickened me. Here's an example:

Artists are paid a points royalty on sale of master recordings (while songwriters are paid publishing royalties on the sales of songs). 15% (15 points) is quite a good royalty for a new band, or even one with a hit under their belt.

But does that mean 15 points off all sales? Nope.

It means 15% of 90% of the worldwide gross. Why 90%?

Because in the 1940's (when the label business models we hate so much were established) lacquer records were still sold and many of them broke in shipment. A 10% "breakage allowance" was standard.

It still is. CDs don't break. But the labels, almost without exception, skim 10% off the top for "breakage" before even getting to recoupment. If IBM skimmed 10% off their earnings before issuing dividends the Board would be crucified. But music labels? No problem!

As for recoupment, the example given in the USA Today article is tame. I won't mention the name, but there is a band who has sold millions, for each of their more than five albums. But each time, video costs, recording costs, marketing/promotion costs, plane fares (for huge label entourages), hotel bills (for these same label execs) were all paid for by the band.

Sum total? They sold 35 million records and still OWE the label over 2 million dollars.

The system was devised in the 40's and has no place in the 21st Century. Hilary Rosen can whine all she wants, but the labels are truly in serious trouble due to their religious adherence to these ancient business models.

Maybe your business stinks

[Rader]

...Wayne Kramer, founder of punk's seminal MC5, felt some empathy for embattled record execs after he established his label, MuscleTone, last year.

"I have a new respect for how hard it is to run a label, and I know record companies lose money on most bands," Kramer says....

What the hell? True, I'm not an ex-punk band leader or label maker, but not being able to sell bad music in a 10 block radius shouldn't be a gauge.

Maybe some type of co-op is needed. A huge number of artists get together, and with power in numbers (and dollars) able to procure the cheapest marketing, distribution, and processing they can get for their dollars. Figure out the costs, and that's what you charge the artist to put out a new record. Profits can go to the artist, with maybe a small percentage going to the investment of the co-op. Merchandise, touring/concerts, part of the working equation. Make rMTv channel (r=real) to play their own videos. Crack into the radio stations market to play their own music only.

*sigh* Probably impossible to do with the monopoly in place.

But then again, maybe it has been done, and the RIAA = the co-op.

Re:Michael Jackson

[PainKilleR-CE]

I think the real hypocrisy lies in the fact that his label went to bat for him when MTV refused to play black artists in the early 80's. They threatened to pull all of their videos if they didn't play his. Of course, at the same time, this shows that the labels can and do have too much influence over what does and does not get played, and if it had not been getting played because it sucked (as opposed to a racial issue), there'd be a very big problem with the label doing that.

Fraudulent accounting...

[vsavatar]

While intentionally not paying royalties is obviously fraudulent accounting. The traditional system of applying overhead to jobs also needs to be eliminated because they're charging artists for idle time that's not the artists' fault, but the fault of the Labels. Take recording for instance. If a recording studio applies overhead based on the estimated number of studio hours they think they'll incur throughout the year, the overhead cost will be more per studio hour than if the studio applied overhead based on capacity of recording hours available which is the way it should be done. Artists should only have to pay for the time, labor, and materials it takes to produce their own albums, not the studio's idle time because they can't get enough business. While this will result in underapplied overhead for the studio and an increase in cost of sales, that's not the artists' fault and it shouldn't be their problem. The Labels and the studios need to find a way to bring their actual recording hours closer to capacity to get their profit margin back rather than overcharging the artists for it which is, unfortunately, still legal in the USA. This is why an album can sell 250,000 copies and still leave an artist owing money, because they're sticking it to them by overapplying overhead.

Do you know what Hilary gets paid?

[Anonymous Coward]

Here's a shocker: Hilary is on a salary of $1.4 million a year, with all travel, clothing, food and personal incidentals added as expenses, plus three "business" residences.Total comp package: about 2.7 million a year. Jack Valenti gets at least 1.5 million more. A YEAR.

And you wonder why she is so tencious about ideas which any sane person would laugh at?

Because she only cares about what most people care about: their own asses. If the music industry no longer has a need for the RIAA, what else could she possibly be qualified for?

Re:An idea...

[paulbd]

whatever the record company is making from the sale of a CD, you can be sure that only a very small fraction of its costs are related to producing the CD itself. marketing, office staff, physical distribution, office costs, studio time, lost money on flops, ... the list goes on.

i'm not justifying any particular price for a CD, but demanding that because a CD is cheap to make means that recorded music sold in CD format should be sold for very little is incredibly naive. the price of the product is not just the price of making the final disc.

i'm also curious at the level of complaint about this particular consumer item, when exactly the same concerns and cost/price relationship exists for most other things that we buy, particularly clothes. i don't hear many people (especially on slashdot) talking this way about t-shirts and shoes, which cost very, very little to make but sell for at least as much as a CD.

Re:Whose Fault Is This?

[salemnic]

Courtney Love's good discussion of how that financing works can be found all over, in places like this:

http://www.cdbaby.net/articles/courtney_love.html [cdbaby.net]

It looks like even when you get a hit, you might not make money.

Re:Because...

[SerpentMage]

And there you highlight the problem. The big five music industry only want to sell, sell, at the expense of the original intent.

I see it here in Europe when they do star talent search. What do they look for? A voice, looks and dance ability. Gee whiz when did music become voice looks and dance ability? I always thought music was the ability of the artist to create something that we enjoy listening to. And if the show is good, well more power to you.

The other problem with people like Brittany Spears is that those are the people where we "steal" music in the form of napster. With talent though, most people I know will actually buy the content since they think they are actually getting value.

The Last DJ

[matthewd]

A couple of weeks ago I got an email advertising Tom Petty's new single, "The Last DJ", mentioned in this article. Although I'm not even a casual fan, I checked it out anyway... Definately worth a listen for anyone opposed to the Clear Clannel-ification of radio and the trend towards pay-per-play. Hard to beleive his label let him put this song on the CD let alone promote it as his first single!

It seems the streaming version is gone but you might be able to request it at a local rock & roll station.

"The Last DJ"

Well you can't turn him into a company man
You can't turn him into a whore
And the boys upstairs just don't understand anymore
Well the top brass don't like him talking so much
And he won't play what they want to play
And he don?t want to change what don't need to change

CHORUS:
There goes the last DJ
Who plays what he wants to play
And says what he wants to say
Hey hey hey
And there goes your freedom of choice
There goes the last human voice
There goes the last DJ

While some folks said you gotta hang him so high
Cause you just can't do what he did
There's some things you just can't put in the minds of the kids
As we celebrate mediocrity
Our boys upstairs want to see
How much you want to pay for what you used to get for free

CHORUS

Well he got in a station down in Mexico
And sometimes it'll kind of come in
And I'll bust a move and remember how it was back then

CHORUS

three victims of the death of the "old system"

[gsfprez]

1. the riaa.

they are nothing but the scribes who are bitching at their own demise as they see the newer technology of the printing press making them obsolete. there have already been too many words written to describe the uselessness of their existance now.. i won't go over it again.

2. musicians with not enough talent to make a living.

shitty bands and guys that can't play their own instrument - whatever it may be - cannot draw an audience will not be able to survive without riaa companies. They don't get word of mouth. they don't get props on indie web radio. i know some of these guys. they are close friends. they have day jobs and they play for fun. that's completely legit and i'm all for that. in other words - they are you and me... guys who need to stop thinking that they are rock stars and get real fscking jobs.

3. songwriters.

i'm not impressed with songwriters. i've read enough web pages with the rantings of college students that can qualify as lyrics... if you can really write lyrics - get with a real good musician and split the income from the shows or cd revenues. songwriting does not merit an entire industry or copyright infrasructre to support them. They need to get real fscking jobs like the shitty bands, you, and me.

the winners?

you and me can just get back to enjoying music, taking it with us, and not worrying about the copyright gestapo DoSing my DSL line, or throwing me in jail because i didn't have the right key to play the wrong music.

Re:Wait a minute...

[Patik]

So, if the musicians don't like them, and we don't like them... why do they still exist?

Do you have tens of thousands, if not millions of dollars to fork over to promote your band and get it heard? Well, the record lables do! Just hand over all your rights to the songs and they'll take care of the rest.

Re:Cost of manufacturing a CD

[Chris Johnson]

Well, costs of production and promotion are much, much higher. Trouble is, costs of production and promotion are almost all totally wasted.

These guys want license to continue paying like $5 a record to Mafia-linked record promoters who act as a go-between to Clear Channel controlled pop radio that nobody cares about anymore... and THIS is their claim of 'we're losing money!'.

Burn it all, sift the ashes for diamonds. If all music became freely copyable, people would be recycling the same 10 records as other records for maybe 2 years before it got plain boring and people wanted to hear something newly recorded.

The cost of transmitting digitally recorded music around is even less... which is a relatively new development, the too-cheap-to-meter nature of transmitting the actual data files.

MY music (see url) is free- I'm not waiting for the old system to die, I'm already trying to figure out what's next. So far, I've found that a lot of people can DL it, and some of them really like it (typically geeks, so far- or maniacs :) ). There's CDs available for relatively cheap, too, and they're damn good quality, but only three people have ever bought one- including one slashdotter. I don't force anyone to buy 'em- I'm just trying to see what happens when you leave people to their own devices. It doesn't look like people give musicians money, even if they like the music, if they're allowed to just have it as NATURALLY happens in a digitally fluid world. I can't change the world, and am not interested in hassling people, so I've been doing less music lately- though I'm getting back into it for my own reasons. I got an electronic drum trigger kit and have been playing soul drums along to records and having a great time, and I got a cellphone headset, hacked it into a simple in-ear monitor using the guts of a tiny amplifier from Radio Shack, and I'm trying to teach myself to sing well, also to records (like Squeeze, Elvis Costello, Bowie etc)

I guess being a musician isn't what you do, it's what you are. I really have no idea where things are going. I do know that when I end up making even better music, or pop/rock/vocal/saleable music, I'm still gonna be making it free for download even if it means I never sell a CD, because I believe in the importance of digital fluidity.

It's like- in Star Trek, do you see them billing people for use of the replicators? Doesn't it look like replication is free and uses only various basic elements (or transporter-like handwaving treknobabble)? Well, with regard to data and information and MUSIC, the replicator is already here. Now that you can replicate anything musicwise you want, now's the time to ask what you want. Do you WANT anything new? If so, what?

Re:Wait a minute...

[J. Random Software]

Non-compete agreements signed by software developers have been held invalid/unenforceable if they leave former employees unable to practice their profession. Why isn't the same thing happening in the recording industry?