Chris Castle suggests “Five Things Congress Can Do For Creators…” in three different areas in this series. Essential reading for all musicians and songwriters for an understanding of the forces and legislation that shape your ability to make a living.
1) Five Things Congress Could Do For Music Creators That Wouldn’t Cost the Taxpayer a Dime Part 1: Pre-72 Sound Recordings
Many of us in the music business know that songwriters and recording artists are financially worse off under the “new boss” than they were under the “old boss.” We have watched older artists “die on the bandstand” because the royalty or residual income they had counted on to support them in their retirement began evaporating with the arrival of the Internet in their lives. We have watched younger artists and songwriters essentially give up on the idea of doing anything but breaking even — maybe, if they are lucky — on sound recordings. And there is a growing realization that being in cut out bin, or as it’s known online the “long tail”…well, is not ideal. So what is to be done?
2) Five Things Congress Could Do for Music Creators That Wouldn’t Cost the Taxpayer a Dime Part 2: Update the Compulsory License for Songwriters
One might ask why do we need a compulsory license for songs? At a time when the dominant big tech companies drive around the world snorting up private data and taking pictures of your house, have scant attention paid to them when they gobble up companies to increase their market dominance or even monopoly, and employ an unprecedented number of lobbyists to influence governments around the world, why are we still worried about compulsory licenses for songs? To protect the public from the anticompetitive ambitions of songwriters?
3) Five Things Congress Could Do for Music Creators That Wouldn’t Cost the Taxpayer a Dime Part 3: Create an Audit Right for Songwriters
Chairman Goodlatte has said he intends to update the Copyright Act to bring it into line with the digital age. The Congress already allowed audits for the compulsory license for sound recordings and the webcasting royalty established under Section 114. This mechanism that Congress created in the recent past is working quite well.
Chairman Goodlatte could borrow heavily from the audit rights for the Section 114 compulsory license for sound recordings, and allow songwriters to conduct group audits under Section 115 to avoid a multiplicity of audits.
There have been a lot of predictions about how the internet was going to empower musicians and create a new professional middle class. Unfortunately, the year end numbers from Soundscan for the last two years just do not support those claims.
2011:
in 2011 there were 76,865 new releases, only 3,148 sold more than 2,000 units = 4% of new releases sold over 2,000 units
in 2011 there were 878,369 total releases in print, only 15,613 sold more than 2,000 units = 2% of ALL RELEASES in print sold more than 2,000 units.
2012:
in 2012 there were 76,882 new releases, only 3,074 sold more than 2,000 units = 4% of new releases sold over 2,000 units
in 2012 there were 909,799 total releases in print, only 15,507 sold more than 2,000 units = 2% of ALL RELEASES in print sold more than 2,000 units.
So in the last two calendar years only 4% of New Releases and only 2% of ALL releases managed to sell more than 2,000 units.
That means 96% of all music released and in print sells less then 2,000 units per year. Please tell us again about all of this internet empowerment?
Who do you really think is selling more than 2,000 units a year, the Indie/DIY artist uploading to TuneCore, or the artist with label support? Let us not forget, the indie/DIY artist is spending their own money now on marketing, PR, social media, everything – without those cost and expenses being advanced to the band as investments by a label.
A decade in from predictions of empowerment what we have found is more exploitation in the facts.
Of course, those who continue to work in the creative class are the lucky ones. Employment numbers from the Bureau of Labor Statistics show just how badly the press and media have missed the story.
Other fields show how the recession aggravated existing trends, but reveal that an implosion arrived before the market crash and has continued through our supposed recovery. “Musical groups and artists” plummeted by 45.3 percent between August 2002 and August of 2011. “Newspaper, book and directory publishers” are down 35.9 percent between January 2002 and a decade later; jobs among “periodical publishers” fell by 31.6 percent during the same period.
There’s more music being created than ever before, but paradoxically, musicians are making less. Which means there are also fewer musicians and music professionals enjoying gainful employment, thanks to a deflated ecosystem once primed by major labels and marked-up CDs.
It’s a difficult reality to stomach, especially given years of misguided assumptions about digital platforms. But it’s not really a revolution if it’s not getting people paid. And according to stats supplied by the US Department of Labor, there are 41 percent fewer paid musicians since 1999.
So there you have it from two different independent sources both arriving at a reduction of 40%+ fewer full time working middle class musicians since 1999 and 2002 respectively.
The enemy are the for profit businesses making money from our recordings and songwriting illegally. Let’s be clear about this, our battle is with businesses ripping us off by illegally distributing and exploiting our work for profit. This is not about our fans. It is about commercial companies in the businesses of profiting from our work, paying us nothing and then telling us to blame our fans. That is the ultimate in cowardice and dishonesty.
Perhaps 2013 will be the year that we see as the tipping point in artists rights advocacy for an ethical and sustainable internet. There have been more artists speaking up vocally this year than we can remember over the last decade. The hangover from an excess of hope that the internet would empower musicians has begun to set in as the evidence of more, and worse exploitation becomes increasingly obvious every day.
“[Big Tech] have to keep commodifying things to keep the share price up, but in doing so they have made all content, including music and newspapers, worthless, in order to make their billions. And this is what we want?
“We were so into the net around the time of Kid A,” he says. “Really thought it might be an amazing way of connecting and communicating. And then very quickly we started having meetings where people started talking about what we did as ‘content’. They would show us letters from big media companies offering us millions in some mobile phone deal or whatever it was, and they would say all they need is some content. I was like, what is this ‘content’ which you describe? Just a filling of time and space with stuff, emotion, so you can sell it?”
Nine Inch Nails frontman Trent Reznor has also been outspoken this year commenting first on streaming services, and then later on the value of music.
“I know that what we’re doing flies in the face of the Kickstarter Amanda-Palmer-Start-a-Revolution thing, which is fine for her, but I’m not super-comfortable with the idea of Ziggy Stardust shaking his cup for scraps. I’m not saying offering things for free or pay-what-you-can is wrong. I’m saying my personal feeling is that my album’s not a dime. It’s not a buck. I made it as well as I could, and it costs 10 bucks, or go fuck yourself.”
Jerry Cantrell of Alice In Chains refused to play new songs in the bands live set until the new album is released to protect the integrity of the bands work.
“Well, in the old days – if you start out with ‘in the old days,’ you’re totally an old f–k – you were able to play a lot more stuff live,” Cantrell tells Spin magazine. “But with the advent of the Internet and sharing and shit going everywhere, you can’t do that anymore. We really haven’t been playing anything off the new record that’s not out yet. We’ve been playing ‘Hollow‘ and ‘Stone,’ and now that it’s going to be released, we’re thinking about whipping out ‘Phantom Limb‘ and maybe a few more.”
Quincy Jones discussed his legacy and the challenges presented for new artists in an environment of unprecedented piracy.
What’s sad is that there is 98 percent music piracy everywhere on the planet. It’s just terrible. What if these kids (who download music illegally) worked for me for two months and then I said, “I’m not going to pay you.” That’s just not right.
Aimee Mann brought a lawsuit against a digital distributor.
Guy Marchais of the band Suffocation showed fans how to buy a CD and explained the importance of supporting artists with legal purchases.
Marc Ribot of Ceramic Dog (and sideman for Tom Waits) took up the battle against Ad Funded Piracy.
We don’t know what the ultimate solution is — but we know it isn’t the impoverishment of musicians and defunding music. And we know it isn’t pretending that no-one is being hurt. Corporations are making huge profits from the ads on ‘free’ sites, from selling the hard and software that make illegal downloading possible.
Austin band Quiet Company noted their disappointment after an internet marketing partnership experiment.
““After everything, I’m not sure there is a new model. The old model is still the model, it’s just that the Internet made it way worse.”
East Bay Ray of the Dead Kennedys noted who is making money and who is not at SF Music Tech.
“There’s opportunists on the Internet that have taken advantage of the artists, [they’re] giving a free ride on a carnival horse, but they’re starving the horse.”
Zoe Keating spoke to the NY Times about how artists in certain genre’s such as classic and jazz maybe condemmed to poverty in the new digital economy without better mechanisms in place.
“In certain types of music, like classical or jazz, we are condemning them to poverty if this is going to be the only way people consume music.”
Blake Morgan went public with an email exchange between him and Tim Westergren over Pandora’s attempts to reduced already low royalties to artists.
I hear you when you say you’re “seeking a balanced structure that allows musicians to generously participate in the business.” But respectfully –– and this is quite important –– musicians are what your business is built on.
Without us, you don’t have a business.
Victoria Aitken wrote about the effects of piracy on EDM artists.
“The Internet pirates have made me, and thousands of other musicians, walk the plank. We now have to swim in shark-infested waters where the big fish gobble up our dues and the pirates laugh their way to the bank.
I believe this basic injustice must be remedied – Internet pirates are white-collar criminals. They should pay the royalties they have stolen or be answerable to the law, like looters, burglars, and fraudsters.”
Pink Floyd expressed their feelings about Pandora and digital royalty rates for the next generation of musicians.
It’s a matter of principle for us. We hope that many online and mobile music services can give fans and artists the music they want, when they want it, at price points that work. But those same services should fairly pay the artists and creators who make the music at the core of their businesses.
Martha Reeves also explained the importance to continue to work towards fair royalties for artists in the new digital economy.
Musicians should be paid a fair value for their work and all digital services should play by the same rules. These are just common sense ideas, and once Congress adopts them as law, future generations will wonder why we ever struggled over them. But that’s why we must keep struggling – until justice is done.
Shawn Drover drummer for Megadeth responded to a question asking if the band had been effected by piracy.
Of course it is. We are certainly thrilled to have a #6 record on Billboard in America and #4 in Canada, but sales are way down for the entire music industry right across the board, which is a real drag. Internet piracy, torrent sites and all that are the reason why. Concert attendance for us is still great around the world, so we are definitely happy about that.
History repeats itself as once again we see public relations spin covering up for big business. This time Silicon Valley appropriates the “Tobacco Playback” in it’s war against musicians and creators to cast doubt on the destruction caused by online piracy.
What follows is a true story.
For the uninitiated Merchants of Doubt is a 2010 book that explores the tactics and strategies of Big Tobacco that were used for the “deliberate obfuscation of the issues which had an influence on public opinion and policy-making.”
There are few things we can think of in the history of the United States that was more controversial and embattled than the war over tobacco policy and public health. In it’s conclusion, this long history resulted in the now non-controversial understanding of the simple truth that smoking cigarettes is a leading cause of various cancers. This clip from Mad Men is a subtle look back at that time.
Today, musicians and creators are faced with a similar situation. For over a decade, the decline of recording revenues has been the subject of such a controversy as spun by Silicon Valley interests in the name of “internet freedom”. However in reality the battle is really over “internet freedom to profit for advertising revenues” while exploiting the work of musicians and creators without compensation.
Among the claims made in “A Frank Statement to Cigarette Smokers” are these:
Although conducted by doctors of professional standing, these experiments are not regarded as conclusive in the field of cancer research. However, we do not believe that any serious medical research, even though its results are inconclusive should be disregarded or lightly dismissed.
At the same time, we feel it is in the public interest to call attention to the fact that eminent doctors and research scientists have publicly questioned the claimed significance of these experiments.
Distinguished authorities point out:
That medical research of recent years indicates many possible causes of lung cancer.
That there is no agreement among the authorities regarding what the cause is.
That there is no proof that cigarette smoking is one of the causes.
That statistics purporting to link cigarette smoking with the disease could apply with equal force to any one of many other aspects of modern life. Indeed the validity of the statistics themselves is questioned by numerous scientists.
We accept an interest in people’s heath as a basic responsibility, paramount to every other consideration in our business.
We believe the products we make are not injurious to health.
We always have and always will cooperate closely with those whose task it is to safeguard the public health.
Why does reading the above give us PTSD flashbacks to the Interactive Advertising Bureau (IAB) Anti-Piracy “Best Practices Memo” from earlier this summer?
The chief tactic employed is not only to cast doubt upon what is the first and most obvious cause of the issue being discussed but also to give the appearance of being agreeable to the contrary. Let’s see if any of this sounds familiar as espoused by Silicon Valley’s free-culture advocates as possible reasons for the decade plus decline in sound recording revenues.
Distinguished academics point out:
That research and studies of recent years indicate many possible causes of declining recording revenues.
That there is no agreement among the academics regarding what the cause is.
That there is no proof that filesharing and internet piracy is one of the causes.
That statistics purporting to link declining recording revenues with content piracy could apply with equal force to any one of many other aspects of modern life. Indeed the validity of the statistics themselves is questioned by numerous academics and researchers.
The effects of piracy have been studied thoroughly and the conclusions are pretty clear and common sense. Illegally free without consequence has a negative impact on the same product available legally for sale.
Michael Smith and Rahul Telang wrote Assessing the Academic Literature Regarding the Impact of Media Piracy on Sales, which looked at empirical (rather than theoretical) studies in academic (particularly peer-reviewed) journals and found that the vast majority of studies found evidence that piracy harms media sales.
A similar study, The Economics of Music File Sharing – A Literature Overview, by Peter Tschmuck, which was cited by the Swiss government in an official report, examined 22 independent, academic studies (i.e., not industry-funded) focused on music sales and found that 14 came to the conclusion that unauthorized downloads have a “negative or even highly negative” impact on recorded music sales.
The bottom line for musicians is to recognize the truth that there is a lot of money being made in the distribution of music on the internet. Unfortunately that money is not going to creators, it is going to illegally operating and infringing businesses supported by black box advertising networks. But don’t take our word for it, here’s a report from Digiday an Ad Tech trade publication owned by parent company The Economist.
According to AppNexus CEO Brian O’Kelley, it’s an easy problem to fix, but ad companies are attracted by the revenue torrent sites can generate for them. Kelley said his company refuses to serve ads to torrent sites and other sites facilitating the distribution of pirated content. It’s easy to do technically, he said, but others refuse to do it.
“We want everyone to technically stop their customers from advertising on these sites, but there’s a financial incentive to keep doing so,” he said. “Companies that aren’t taking a stand against this are making a lot of money.”
Somewhere, someone may still believe that cigarettes are healthy and do not cause cancer. And somewhere, someone may still believe that the cause of the destruction to the careers of musicians and creators is not internet piracy.
We recently reblogged a link to Trent Reznor’s interview in Spin Magazine where he stated his current feelings over the value of music as a creator. Below is a comment in response to that article that we felt deserved it’s own post.
Music, like a certain other activity, is usually done for love or money. A lot of pirates nod enthusiastically at this right up until they realize that, if there’s no money in it and a musician has to do it for love … that if I don’t love you, you don’t get any.
They keep missing this part. Yes, musicians will MAKE music no matter what. But we don’t have to share it with anyone other than the people we want to share it with. In order to get into that room, now you need to persuade me you should be there. Before, you could throw money at me, and I’d let you in. Now that there’s no money in it, I need another reason. Be an asshole, and you don’t get in.
Even the threat of not making money will only work on artists for so long. They won’t just hang around and starve. Eventually, they will read the writing on the wall, bow to reality, and simply get other jobs and decouple their artistic output from their financial input. And then they really don’t have to share our music with just anyone.
The pirate kids really aren’t following this thing to its logical conclusion:
1) Decouple money from art. Then,
2) Artists get day jobs and keep them. Hence,
3) We don’t need to share our art with anyone if we don’t want to.
So make me want to.
Oh … and without handing me money, which would have been the simplest way to accomplish that, but that’s not working anymore, is it?
Neither will acting like a tantrum-throwing, entitled brat.
For those in doubt, we can reference Beck who first made available his album “Song Reader” as sheet music, encouraging people to supply their own labor to hear his new songs.
We’ve been watching with interest a story developing over at Digital Music News. The site ran a guest editorial by Jeff Price promoting his new YouTube Content Management System Collections Service, Audiam.
It’s interesting to note how Price targets distribution companies as the black hats but does not criticize YouTube for their less than stellar “Openess and Transparency” with artists. East Bay Ray of The Dead Kennedys spoke to NPR about his frustrations with Google.
“Holiday in Cambodia” by the punk band Dead Kennedys has been streamed on YouTube over 2.5 million times. Guitarist Raymond Pepperell — also known as East Bay Ray — says, overall, Dead Kennedys videos have been watched about 14 million times. But the band has only seen a few hundred dollars.
“I don’t know — and no one I know knows — how YouTube calculates the money”
It’s easy to see why so many readers took exception to Price’s understanding of how YouTube monetization works (or actually doesn’t). One of those people wrote a response to Price’s editorial, Emmanuel Zunz of ONErpm.
If I understand Audiam’s business model correctly (I have tested the service), it’s a pure Content ID play. So here is my first point: Audiam states that they pay artists 100% of the revenues they collect for them from their own channel. But by generating UGC claims on their channels that pay out at 35% instead of the Standard 55% an artist can get on their own, they are actually reducing the amount of money a musician can make through a Standard direct deal with YouTube.
What follows is the real story about the lack of transparency and openess that Google claims is essential to a “free and open” internet. You know, the kind of “free and open” internet where you make the music, movies, books, photos, etc and Google is “free and open” to monetize it without restriction. “Permissionless Innovation” yo!
So apparently when Zunz was being transparent and open (um, without permission) about Google/YouTube payments and policies in his response to Price he got a little to close to home in revealing Google family secrets. The result was a panicked Zunz contacting Digital Music News to remove, retract and/or otherwise redact the information that Zunz had made public. Oooopsies…
According to ONErpm, YouTube has demanded that the entire guest post – here – be ripped down, which would obliterate nearly 100 comments and the knowledgebase that comes with that (not to mention the detailed information in the post itself).
But the story doesn’t end there. Zunz had already written a second a highly detailed post for Digital Music News detailing how YouTube monetization actually works! Unfortunately that “Open and Transparent” post is not going to see the light of day in educating musicians about the actual mechanics, percentages and payments by YouTube.
Despite serious threats, YouTube has been unsuccessful at removing an earlier article on Digital Music News about confusing royalty payouts and specifics. But what they have been successful at is preventing the next one: a4,000+ word, highly-detailed essay on YouTube best practices and royalties, from a company highly-specialized in YouTube distribution.
The company simply got spooked, and asked that we not print the piece for fear of having their MCN status revoked by YouTube. So here’s what artists, labels, publishers, startups, and the industry is missing as a result.
“I know that what we’re doing flies in the face of the Kickstarter Amanda-Palmer-Start-a-Revolution thing, which is fine for her, but I’m not super-comfortable with the idea of Ziggy Stardust shaking his cup for scraps. I’m not saying offering things for free or pay-what-you-can is wrong. I’m saying my personal feeling is that my album’s not a dime. It’s not a buck. I made it as well as I could, and it costs 10 bucks, or go fuck yourself.”
Web streaming is quickly becoming the preferred method for listening to music in this country. And Pandora, with more than 70 million active listeners and about a 70 percent market share, is by far the nation’s most popular service.
That’s why we’re deeply troubled by the pitifully low royalty Pandora pays to songwriters, composers and music publishers for the rights to stream their creative works online.It makes sense that one of Pandora’s core input costs should be royalties paid to the creators of the music they stream.
But right now, Pandora only pays about 4 percent of their annual revenue in performance rights royalties to songwriters, composers and music publishers.
We’d just like to say a very big thank you to both Lou Reed and the Dead Kennedys who publicly posted to Facebook this week our posts showing how they are being exploited by major brands and big tech internet advertising corporations.
These artists have presented their concerns ranging from Spotify royalty rates, Pandora’s dishonest attempts to cut their currently mandated rates by 85% and of course Ad Funded Piracy which pays artists absolutely nothing.
In each of the cases addressed above artists are speaking out against the exploitative practices of corporate interests destroying the ability of professional musicians to maintain sustainable careers.
Change happens when artists speak up and speak out.
Every now and then you get a gift from the ether–today’s hearing “Innovation in America: The Role of Technology” at the Subcommittee on Courts, Intellectual Property, and the Internet was no exception. It’s hard sometimes to convince lawmakers and staff that “yes, they really are that self-centered” when speaking of the groovier-than-thou Big Tech community, so it’s always nice when Big Tech does it for you.
First of all–get it straight that it is highly unlikely that anyone on today’s panel uttered a word that was not approved somehow by Google or its intermediaries. And certainly not one word was uttered that would give Google any heart palpitations (or as they say in the mountains, “agida”).
Having said that, I think the testimony of the witnesses at today’s hearing can be distilled into a few recurring themes, although I encourage anyone who thinks I’m oversimplifying to read the transcript…
The Trichordist 
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