Record Labels Unveil Greed 2.0 571
theodp writes "Unsatisfied with $2.49 ringtones and as much as 70 cents of each 99 cent iTunes download, Newsweek reports that record labels want a bigger cut of digital music profits. One example: If you type in 'Madonna' - a Warner act - at the Google Video site, and the results are accompanied by ads, Warner wants a share of those ad dollars." Even more ridiculous demands than those put forth in previous stories.
stunned (Score:3, Interesting)
just..wow.
I was about to go out and buy most of Sade's discography.
I wish to hell we could just pay the artist directly.
Re:The RIAA is irrelevant. (Score:5, Interesting)
Some day the major labels will be irrelevent, but today is not that day (maybe that's why they're so desperate to maximize their profits in the short term... they know the long term doesn't exist).
Re:The RIAA is irrelevant. (Score:3, Interesting)
And honestly, how much more can they charge per song? I found a lossless online store (finally) a few days ago, and they charge a minimum of $1.29 a track PLUS a $50 annual fee. That works out to way more than just buying the CD (in all it's lossless, archived, liner-noted, cover-arted glory). Honestly, CDs are enough of a rip off as it is, there simply isn't enough room to increase the price of a 30 minute album any more than the already inflated cost...
Re:no suprise (Score:5, Interesting)
Welcome to US Capitalism 101 (Score:5, Interesting)
The wealth has to come from somewhere. That somewhere is the poor below. They talk of trickle economics for the the poor getting money from the wealthy, but it's quite the reverse. Wealth, often in the form of labor, flows from the bottom up. If not, they wouldn't be so rich.
To back this stance, it is worth nothing that the wealthiest wealthy grew wealthier between 2003 and 2004, partially thanks to tax cuts. The poor, however, became poorer. During that time period the number of Americans living in poverty grew by 1.4 million. Source: this CNN article [cnn.com].
I'm not an advocate of pure communism, but what we have today isn't really capitalism, it's a crappy corporate welfare system that intentionally pisses on the poor.
Did anyone else notice... (Score:2, Interesting)
Hmm.
A google ad is "adjacent space" (Score:3, Interesting)
The notion that record labels should share in advertising revenue from keyword searches is to confuse the ownership of intellectual property with the concept of "adjacent space".
Adjacent space is frequently sold at a premium in multiple mediums, from supermarket shelf-space, to tradeshow booth-placement, to partial-page magazine advertising. Wherever a premium brand is located, the neighboring advertising- or product-space increases in value. If a record store puts Sarah Q. Smith's album on a shelf next to Madonna's new album, the record store is effectively using Madonna to promote the sale of Sara Q. Smith. But this is very different from capitalizing on Madonna's intellectual property. This is capitalizing on *Madonna's market*, which is something Madonna does not own, control or have rights to.
Likewise Google's use of adjacent space, ie: space neighboring Madonna's relevant links, is Google's own affair. It is Google's effort to target Madonna's market -- which is as old a phenomenon as the outdoor marketplace.
The entertainment industry needs to get a reality check on the scope and limits of IP.
Re:Stop listening? (Score:1, Interesting)
If I can't find the address, I wait until I can get to one of their shows and put the whole mess in an envelope and hand it to a roadie or throw it on stage during set change.
Re:The RIAA is irrelevant. (Score:5, Interesting)
requiring musicians to use record company owned resources let's the recod companies control costs without having to pass on the savings to the musicians. i believe the record industry actively fights legislation that would require it to exercise fiduciary responsibility. that would end the party for the muisic companies.
it's no wonder that once an act becomes even a little successful, it then goes on to equip its own recording studio. my guess is that musicians would love to gain control over how they are promoted and distributed, if only to keep the music companies from freely spending the musicians' money.
Highly Misleading Summary, Ignorant Comments! (Score:3, Interesting)
Apparently the record companies used to allow portals like Yahoo to show their videos for free, since they considered it free advertising for their music. Then, they realized that Yahoo was making lots of money off
the deal through advertising, so they asked for a cut. Yahoo refused, but saw their hits go down, so they negotiated a deal. Basically, an exec at Universal realized what they considered advertising was more like giving away free product. This makes sense: people weren't discovering new music on Yahoo. Most of the time, they came there to see videos and songs they already knew.
I suppose you could say the record companies are being greedy, but they're not doing anything suspect. They realized other companies were making money off their products, and decided to charge for the privilege. Similarly, they're trying to renegotiate with Apple, and we'll see who wins there. They may harm their own market more than they expect by raising the prices, or the market may be happy to pay $1.30 for new hits. We'll just see. They're also renegotiating with satellite radio, now that that industry is pulling in lots of money, again with the RIAA's products.
There's no talk in the article of charging anyone for search engine keywords.
Re:Stop listening? (Score:1, Interesting)
Very little new music is really worth my time. I'd guess that in the past 10 years, I've probably bought 30 CD's, and 1/2 of those were for Xmas presents, not anything for me. And while the RIAA may like to blame that on "piracy", I really hate to tell them.. its because most of whats out there is crap guys.
it's true, i know! (Score:5, Interesting)
so many bands nowadays are picked up or formed by majors (RIAA labels) secretly, then they are put on an "indie" label for their first cd. then once the indie/punk/insert_somewhat_underground_genre_here crowd loves them, they release the next album on the major.
then when they are on mtv/radio, the people who just buy into whatever they hear love them, and so does the underground (or at least those who'd like to theink they are) crowd.
it's ingenious, and disgusting.
Re:no suprise (Score:5, Interesting)
Start by charging people an extra "RIAA Advertisement Fee" to run an ad on "Madonna" or the like. This money goes into a big pool. Then, from that pool, make up a list of services and subtract out 90% of the money for things like "fiscal management" "trademark research" "artist contact costs" or anything else that sounds good but is total contractually-agreed-to bullshit.
Re:Stop listening? (Score:2, Interesting)
However, it does take work. I typically go to concerts several times a week, and buy most of my CDs at the shows. Most people aren't willing to devote that kind of time, so they take what the industry feeds them.
Re:Since you brought it up... (Score:5, Interesting)
Oh. What was the question again??? = )
Well, happy to pointificate!
Hmmm.. Boycot Exxon? OK, well, they would just advertize like BP. Sunflowers, responsibility, alternative energy. Bla bla. People would believe it too. All the while they pump that oil...
Prices of gas are increasing faster than crude because they are different markets. Now there are limited amounts of refineries in the US and few companies can invest that much capital to build one... I understand they take a few years to build and get onstream..
Not that Bush's idea (subsidize the building of oil refineries) is a great one. The oil companies are making big bucks: they should do it right? I heard that one made more profit last quarter than any other company in history. Could have been Exxon, I don't remember.
To me, the question is: why are there so few refineries now? Did the oil excecs get to gether some golf game and say: Let's not build any more for a couple years? Was it *really* environmental regulation that quashed them? Collusion in that market would have the benefit of huge profits for them. I remember Cheney had secret meetings with the oil 'boyz' a few years ago, and they collectively decided US energy policy, without ever releasing the minutes of those meetings.. I think that was pre-Iraq so they might make some fun reading in 40 years.. It could have been similar to:
Cheney: Thanks for the donation, boyz. Like the cigars? They're Cuban! Batista! Well, to business then. We agree that you don't make any refineries in the next few years (and collect excess profits), support us in Iraq, and we'll get you those Iraqi drilling contracts, leash the anti-trust hounds. Of course we'll expect future consideration...
Oil barons: No refineries? None of us? We're "Gung Ho" for Oil Contracts! (puff.. puff...) OK, deal.
Well it *could* have been like that! = )
In general, you are better to vote in politicians that support consumers, not oil companies, than attempt to get a boycot organized. Companies (Oil or RIAA members) do not have to adapt to change if they are protected by fiat. And one can buy policy so cheaply these days:
$200M building an oil refinery could get you say a %50 return if you bet correctly on oil prices.
$50,000.00 donation/investment to Cheney's PAC could help get you $8,000,000,000 in return.
Where would you invest? The law requires you to act in the best interest of your share holders, not your country.
http://www.mailtribune.com/archive/2005/0429/biz/
http://www.opensecrets.org/pressreleases/cheney/c
Katrina and Rita wipes out a few refineries and it all goes to hell for the consumer...
Of course nobody will know what the truth is until these folks are long gone.
Cheers,
-b
A devil's advocate says... (Score:5, Interesting)
Where did the profits come from? Was there any new value created? Well, the apples didn't change, but the demand did. The demand was created exclusively by Carol.
Bob in the meantime kept his costs low and did not hire any marketers. He did notice something interesting, however - because of all the increased interest in the apples next door, demand for his apples started to pick up as well. Marketing effort paid for by Alice has began to increase Bob's revenues.
Question: does Bob owe anything to Alice?
In the physical world, generally, yes. It's called "location, location, location". Bob can setup a fruit stand out in the middle of nowhere and pay nobody for the privilege. Or he can open a stand in a downtown mall, which will cost him.
Back to RIAA.
Without heavy and expensive promotion by RIAA, the value of, say, 50 Cent would be hovering just above zero (some would argue below). RIAA effectively created the artificial demand for his product, which, supported by copyright laws, fuels a vast ecosystem of businesses. Why shouldn't those benefitting from selling, reselling or otherwise commercially benefitting from 50 Cent's music own portion of profits to RIAA who created majority of the value in the first place?
Disclaimer: I think that RIAA should die and music should be free, but that would be preaching to the choir and, therefore, boring.
Re:The RIAA is irrelevant. (Score:2, Interesting)
If that's the talent RIAA members provide, the talent to destroy generations of music, I say Guantanamo them now. Make them listen to the entire Butch Vig back catalogue on their beloved tissue-papered Yamaha NS-10's as eternal punishment.
The stakes on this are VERY HIGH for Google (Score:3, Interesting)
Google must reject this request and let the RIAA take them to court and subsequently lose. The stakes on this are quite high for all search engine companies. I agree with previous posters who said that Google should delete all RIAA content and have them pay for to get into Google's search database. The result of this would hurt the RIAA worse than it would hurt Google.
Re:Welcome to US Capitalism 101 (Score:4, Interesting)
Taxpayers fund roads, that corporations use to truck their goods.
We pay to educate their workers.
We pay to defend their assets in foreign countries (in the form of wars, and defense spending).
We pay to clean up the environment they pollute.
We pay for courts and prosecutors to jail the white collar criminals.
There is so much public wealth flowing to corporations in this country, and much of it is difficult to measure, but you can tell it's there.
Re:no suprise (Score:2, Interesting)
Spread your meme..maybe the search engines will hear it and we'll watch a paradigm shift happen in the industry.
Re:Wow... (Score:3, Interesting)
If you sing it they will sue
From us all to Time-warner
A large loud F*ck you
Copyrights already last far far too long , the fact that extensions are given is an insult . Especially in the cases of songs which have become part of the public consciousness
Re:no suprise (Score:2, Interesting)
Only complete and utter morons think they need a record contract to make it in music... and I am proven right by simply looking at the retards that are currently in the RIAA artist list.
B- true and already happening. Jimmy Buffett started a record company with some other arrtists that give honest terms to the artists signed with them and share profits with them as well. they are gaining new artists faster than the RIAA would like as it is exposing artists to the possibility that they do not have to be gang raped without lube to "make it".. These record companies are gaining momentum fasterthan Arista, Apple, and other big record companies can even imagine. hell they are pulling acts from them fast as well.
so in reality, A, you can self market yourself easily and cheaply. B, there are new record companies growing that are not basing their business model on rampant financial sodomy of your artists.
Hope you feel enlightened. Posting anon to avoid losing my job at a record company. yes i just gave away 2 really dirty secrets.
Re:no suprise (Score:3, Interesting)
I think of the subscription as severance pay. Sure, RIAA gets one last piece of me, but I get a valuabe resource to learn other places where I can get what I want without having to support them again.
P.S.
Re:no suprise (Score:2, Interesting)
If alive today it's more likely that he'd be writing for shows like South Park or The Simpsons than pro-wrestling.
Re:A devil's advocate says... (Score:3, Interesting)
Ah, but it's a false analogy. In your case, Alice and Bob (presumably; I'm inferring here) had independant orchards. In ours, Bob has to buy his apples from Alice; there's no other source for the apples that Alice and Bob are selling. So Bob's increased sales also lead to more revenue for Alice. (Bob might be sell a few bananas too-- they were grown independantly-- but Alice was only advertising the apples.)
But here's another thing: the RIAA doesn't sell anything to consumers. Alice isn't even selling apples to the public. She knowingly and intentionally paid Carol to increase market awareness. Her only reason was to boost Bob's sales (since Bob pays Alice a cut of every apple, no pun intended).
Now let's get to the real issue here. Alice is advertising apples, but doesn't say where to buy them. So Bob also puts out his own flyers with directions to his apple stand. Alice says, well because I paid Carol all this money, I also want you get paid me for each flyer that Bob puts out. To top it off-- and this is actually irrelevant because the rest is so ludicrous-- she's not telling this to Bob; she's telling it to the flyer printer.
So the analogy is quite different. In your example, Alice and Bob (presumably) had independant orchards. Alice sold apples to the public, and that's why she paid Carol. And Alice wanted to benefit from Bob's increased revenues. But in our case, Alice has the only orchard. She doesn't sell apples; she only paid Carol to boost Bob's sales. And Alice wants to get a cut of Bob's flyer printing.
The way I figure, Bob is paying Alice a lot. Alice isn't giving the apple farmers much at all. The reason she justifies this is by saying that she has to pay Carol so much. So why, when Bob pays for marketing out of his own pocket, should Alice demand money? If anything, it would seem that Alice should give money to Bob-- she's the one with the huge advertising budget.
Re:Playing the devils advocate... (Score:1, Interesting)
If I worked for the RIAA, I would have to come home and bathe in boiling water just to get the stench of greedy a$$hole off of me.
I still think