Re: F*** the Music Recording Industry

["L.A. Angulo" <labaloops@yahoo.com>]

thank you Rick for sharing this! 
cheers
Luis

--- "loop.pool" <looppool@cruzio.com> wrote:

> This is an old speech but I reread it tonight and it
> just made my blood boil.
> 
> It's really long and I warn you,   quite depressing,
>  but I think it's the 
> truth
> no matter what you think of it's author.
> 
> new paradigm, time!
> 
> *********************************************
> 
> This is an unedited transcript of a <sic> speech to
> the Digital
> Hollywood online entertainment conference, given in
> New York on May 16.
> 
> 
> "Today I want to talk about piracy and music. What
> is piracy? Piracy is the
> act of stealing an artist's work without any
> intention of paying for it. I'm
> not talking about Napster-type software. I'm talking
> about major label 
> recording contracts.
> I want to start with a story about rock bands and
> record companies, and do 
> some recording-contract math:
> 
> This story is about a bidding-war band that gets a
> huge deal with a 20
> percent royalty rate and a million-dollar advance.
> (No bidding-war band ever
> got a 20 percent royalty, but whatever.) This is my
> "funny" math based on
> some reality and I just want to qualify it by saying
> I'm positive it's
> better math than what Edgar Bronfman Jr. [the
> president and CEO of Seagram,
> which owns Polygram] would provide.
> What happens to that million dollars?
> They spend half a million to record their album.
> That leaves the band with
> $500,000. They pay $100,000 to their manager for 20
> percent commission. They
> pay $25,000 each to their lawyer and business
> manager.
> That leaves $350,000 for the four band members to
> split. After $170,000 in
> taxes, there's $180,000 left. That comes out to
> $45,000 per person.
> That's $45,000 to live on for a year until the
> record gets released.
> The record is a big hit and sells a million copies.
> (How a bidding-war band
> sells a million copies of its debut record is
> another rant entirely, but
> it's based on any basic civics-class knowledge that
> any of us have about
> cartels. Put simply, the antitrust laws in this
> country are basically a
> joke, protecting us just enough to not have to
> re-name our park service the
> Phillip Morris National Park Service.)
> So, this band releases two singles and makes two
> videos. The two videos cost
> a million dollars to make and 50 percent of the
> video production costs are
> recouped out of the band's royalties.
> The band gets $200,000 in tour support, which is 100
> percent recoupable.
> The record company spends $300,000 on independent
> radio promotion. You have
> to pay independent promotion to get your song on the
> radio; independent
> promotion is a system where the record companies use
> middlemen so they can
> pretend not to know that radio stations -- the
> unified broadcast system -- 
> are getting paid to play their records.
> All of those independent promotion costs are charged
> to the band.
> Since the original million-dollar advance is also
> recoupable, the band owes
> $2 million to the record company.
> If all of the million records are sold at full price
> with no discounts or
> record clubs, the band earns $2 million in
> royalties, since their 20 percent
> royalty works out to $2 a record.
> Two million dollars in royalties minus $2 million in
> recoupable expenses
> equals ... zero!
> How much does the record company make?
> They grossed $11 million.
> It costs $500,000 to manufacture the CDs and they
> advanced the band $1
> million. Plus there were $1 million in video costs,
> $300,000 in radio
> promotion and $200,000 in tour support.
> The company also paid $750,000 in music publishing
> royalties.
> They spent $2.2 million on marketing. That's mostly
> retail advertising, but
> marketing also pays for those huge posters of
> Marilyn Manson in Times Square
> and the street scouts who drive around in vans
> handing out black Korn
> T-shirts and backwards baseball caps. Not to mention
> trips to Scores and
> cash for tips for all and sundry.
> Add it up and the record company has spent about
> $4.4 million.
> So their profit is $6.6 million; the band may as
> well be working at a
> 7-Eleven.
> 
> Of course, they had fun. Hearing yourself on the
> radio, selling records,
> getting new fans and being on TV is great, but now
> the band doesn't have
> enough money to pay the rent and nobody has any
> credit.
> Worst of all, after all this, the band owns none of
> its work ... they can
> pay the mortgage forever but they'll never own the
> house. Like I said: 
> Sharecropping.
> Our media says, "Boo hoo, poor pop stars, they had a
> nice ride. Fuck them
> for speaking up"; but I say this dialogue is
> imperative. And cynical media
> people, who are more fascinated with celebrity than
> most celebrities, need
> to reacquaint themselves with their value systems.
> When you look at the legal line on a CD, it says
> copyright 1976 Atlantic
> Records or copyright 1996 RCA Records. When you look
> at a book, though,
> it'll say something like copyright 1999 Susan
> Faludi, or David Foster
> Wallace. Authors own their books and license them to
> publishers. When the
> contract runs out, writers gets their books back.
> But record companies own
> our copyrights forever.
> The system's set up so almost nobody gets paid.
> 
> * The RIAA *
> 
> Last November, a Congressional aide named Mitch
> Glazier, with the support of
> the RIAA, added a "technical amendment" to a bill
> that defined recorded
> music as "works for hire" under the 1978 Copyright
> Act.
> He did this after all the hearings on the bill were
> over. By the time
> artists found out about the change, it was too late.
> The bill was on its way
> to the White House for the president's signature.
> That subtle change in copyright law will add
> billions of dollars to record
> company bank accounts over the next few years --
> billions of dollars that
> rightfully should have been paid to artists. A "work
> for hire" is now owned
> in perpetuity by the record company.
> Under the 1978 Copyright Act, artists could reclaim
> the copyrights on their
> work after 35 years. If you wrote and recorded
> "Everybody Hurts," you at
> least got it back to as a family legacy after 35
> years. But now, because of
> this corrupt little pisher, "Everybody Hurts" never
> gets returned to your
> family, and can now be sold to the highest bidder.
> Over the years record companies have tried to put
> "work for hire" provisions
> in their contracts, and Mr. Glazier claims that the
> "work for hire" only
> "codified" a standard industry practice. But
> copyright laws didn't identify
> sound recordings as being eligible to be called
> "works for hire," so those
> contracts didn't mean anything. Until now.
> Writing and recording "Hey Jude" is now the same
> thing as writing an English
> textbook, writing standardized tests, translating a
> novel from one language
> to another or making a map. These are the types of
> things addressed in the
> "work for hire" act. And writing a standardized test
> is a work for hire. Not
> making a record.
> So an assistant substantially altered a major law
> when he only had the
> authority to make spelling corrections. That's not
> what I learned about how
> government works in my high school civics class.
> Three months later, the RIAA hired Mr. Glazier to
> become 
=== message truncated ===


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