EMI May Cut Funding To RIAA, IFPI

Teen Bainwolf notes a report that Big Four record label EMI, which is under new ownership, is considering a big cut in its funding for the IFPI and RIAA. Each of the labels reportedly contributed over $132 million per year to fund industry trade groups, and EMI apparently believes that money could be better spent elsewhere. "One of the chief activities of the RIAA is coordinating the Big Four labels' legal campaign, and those thousands of lawsuits have done nothing but generate ill will from record fans, while costing the labels millions of dollars and doing little (if anything) to actually reduce the amount of file-sharing going on."

Tag this

[Mike89]

Tag this 'commonsense'. Finally a record label who is starting to 'get it'.

Change

[Jonny_eh]

All that's needed for change is for the old generation to die out.

"reportedly considering"

[$RANDOMLUSER]

Nothing to see here, move along.

just give it time

[walshy007]

In other words, it's causing too much bad public relations AND not working, require new methods to screw the consumer with having them actually enjoy it this time. after they come up with something new, business as usual.

Re:Tag this

[Anonymous Coward]

Yeah, but the moment of truth will be when more effective TPCA / Vistaids backed DRM becomes feasible to widely deploy ... will they use it and shit all over consumer's fair use rights again? I suspect they will. They're waking up to the fact that their current tactics are counter-productive, not necessarily to the general idea that their consumers should be treated fairly.

Re:Tag this

[CastrTroy]

Finally a BIG NAME record label who is starting to 'get it'.

There, fixed that for you. There's lots of smaller labels who have "got it" all along, but they're just smaller ones, and you don't hear their music on the radio, or on the TV. There's plenty of good music on the smaller labels, and if people actually had any convictions, the RIAA would have gone bust many years ago, and their member companies wouldn't have been able to sell any music. The point is that most people don't know or don't care about the RIAA tactics. My biggest question is what happens to EMI now if they do this? Will they still be able to get as much radio play their music on a regular basis? Will their bands still get invited on the talk shows? How far does the power of the RIAA really extend?

Re:one down, three to go!

[east coast]

It's hard to argue with EMI's logic there

Considering that EMI never said what was in the blurb and it was a blatant misrepresentation?

perhaps DRM will go the way of prohibition

The thing is that prohibition really didn't go away and the war on drugs is the remnants of prohibition. You were conned into thinking that we won some great victory when, in fact, we merely gained back the "right" to what they could tax.

Re:one down, three to go!

[Billosaur]

Actually, I don't think that's a bad analogy. Making liquor illegal only drove liquor production and distribution underground, brought about the rise of organized crime (remember Al Capone?), and probably increased the amount of alcoholism prevalent at the time. Face it -- if the liquor supply is limited, and you know where to get it, you're going to try and get as much of it as you can. Same thing is happening to music -- making file sharing and ripping illegal is simply driving the illegal file sharing economy, and it's costing the music industry far more money to try and stamp it out than it would be to embrace it and try to work with buyers.

"considering"

[torkus]

Considering does not mean they're actuallg going to do it.

You know "Mr. Overpaid Exec #1" at RIAA will call "Mr. Way-Overpaid Exec #2" at EMI and say something like 'Hey Bill, we'll try to fuck you guys up a little less next year. Promise. Besides, I my kid's going to for her degree in basket weaving and I need to make sure I get my raise to pay for that and the new ferrari'

So instead EMI coughs up extra cash this year for the MAFIAA to "change tactics" whereby they sue...everyone!

Re:Change

[SamP2]

That's the same thing the hippies said back in the 60s. Now that they're the ones with the reigns in their hands and what has changed?

Them.

Amazing

[sircastor]

Somebody actually gets it... I'm very pleased to see that a record label recognizes this and acknowledges it publicly. It shows they're not all buffoons.

It's not common sense, it's lack of money

[Thanshin]

Guy Hands aims to snuff out excesses that cost EMI £100m a year

Guy Hands, chairman of EMI, has told potential investors the group's former management squandered around 100 million pounds on corporate excesses. Terra Firma, Hands' private equity firm, is expected to make major changes to senior management and transform the culture of a company considered to be stuck in the glory days of the music business. Industry observers say Hands will try to blame previous management for the firm's woes because he has paid over the odds for a business struggling to cope with a dwindling market.

http://business.timesonline.co.uk/tol/business/industry_sectors/media/article2963629.ece [timesonline.co.uk]
http://dealbook.blogs.nytimes.com/2007/11/27/in-winning-emi-is-guy-hands-losing-out-on-other-deals/ [nytimes.com]
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/10/08/cnemi108.xml [telegraph.co.uk]

Re:Tag this

[dgr73]

Exactly what he said :) Plus the fact that it's slowly but surely becoming an "in" thing to be seen to be on the consumer's side. Why fight a fight you can't win and ruin your reputation in the process. Why not make a big hoopla about cutting funding to RIAA and then cut it by 10%, which is invested into other counterpiracy measures. Not only will your company look good (compared to the other 3 major labels), but they may actually see slightly improved results.

Or it could be that the music industry is turning altruistic in it's old age and they wish to slash their profit margins by condoning free downloads. The next move in this vein will undoubtedly be a repeal of the "work for hire" clauses in all contracts, as well as a large hike in royalties.

They "may" cut funding?

[IGnatius T Foobar]

They "may" cut funding? Let me know when they *DO* cut funding. Until then, this should be dismissed as PR theater. Perhaps EMI wants to manipulate the RIAA in some way ... maybe reduce their share of the funding, or gain more power within the organization, or something.

So far it's just talk. And talk is cheap.

Re:Tag this

[FredDC]

The problem is that the RIAA would attribute the decrease in sales to piracy, not to the fact that people stop buying the music because they are against the RIAA's tactics.

I haven't bought any of the big labels' music in a long time, nor have I downloaded it. The rare occasion that I listen to the radio (usually in someone else's car), I realize I haven't missed much...

I wonder how much percentage of the drop in record sales is due to people who simply stop listening to the music these record companies produce. The RIAA is always shouting that it's because of piracy, but how much is due to other reasons? I doubt they've done any research about that.

Re:Tag this

[DannyO152]

Promotional bookings. No change. Not one dollar to RIAA goes to artist development and support. Bookings relate to popularity, availability, and when all things are equal, if the program is a booking agency's package, then musical artists represented by that agency move to the front of the line.

Radio is a more complex question. Do the radio stations believe that digital music increases or decreases their listenership? How much radio programming is actually based on the artists the big labels sell? While the radio stations leverage the fact that they can make songs hits and there are more good records than airplay slots, they are constrained by having to do some amount of giving the listeners what they want. As they are also promoting local concerts (well, ClearChannel is), they can't afford to base every decision on back room deals and accommodations. I guess it comes down to how they felt the record companies suing grandmas helps or hinders their business and how significantly. I tend to believe radio will sit out this one: it's really hard for me to expect that the other record companies could make a compelling case as to why a radio station should stop playing Beatles music.

Re:Tag this

[BoomerSooner]

Yes and no. Can you imagine how many bands they could sign and promote for 132 Million a fucking year? NO wonder these morons are losing their asses. If you cannot bring shit to market better than Brittany why would anyone buy your music?

Congrats to EMI for waking up, but it's too little too late. Their business model is dead.

Re:one down, three to go!

[gweihir]

Maybe if these substances were free of their black market status they'd lose their allure.

They still can be used to make a decent living, but it will be ordinary commerce because of much reduced profit margins. No shooting or gangs involved. But I guess this "war on drugs" is basically a PR thing, just as the "war on terror". Both do increase the problem while pretending to decrease it.

Re:Tag this

[sm62704]

The RIAA is always shouting that it's because of piracy, but how much is due to other reasons?

Actually, piracy is one of the biiggest reasons I stopped buying RIAA music - I'm boycotting the majors because of their suits against their "pirate" customers. Of course, since I don't like much of what's on the radio these days either that nmakes boycotting that much easier. I've found that the local bands and their CDs are hgeads and shoulders above the RIAA dreck, while 1/4 to 1/2 the price.

The indies are the "pirates" who are eating away at "their" profits.

-mcgrew

Re:Change

[Anonymous Coward]

Um, no. Even at the height of the hippie movement, those who genuinely believed in liberty were by far the minority. Just as it's always been.

Much more likely is the simple fact that there are more people in this world who believe in employing coercion as a means (i.e. government) rather than voluntary association (i.e. freedom).

Fortunately for those in the business of government, the average individual finds it quicker and easier to just swallow the propaganda than actually spend the time educating himself.

Re:Not bad guys

[scubamage]

I understand your point, however spelling it out that way will get you nowhere in a court, or board room. The sooner you stop treating them like they're evil, the more responsive they're going to be to your ideas. I agree with you completely, but you have to put things in a business context. They didn't go to war with their customers in their eyes, they used their legal right to sue people who they believed were violating their rights. Their rights are violated, so they sued. Because of it, consumer rights are getting violated. This is making their customers even less likely to buy their music. Its a bad situation for everyone. So, how do we improve things? Compromise. They get a harsh reminder that they can't survive without us, and evolve to take advantage of new business models which will spur them out ahead of their competition. We get to enjoy our media on different platforms (like EMI's drm free music). Everyone wins. They just have to be willing to accept their business model is outdated, and going to cost them their shirts if they don't evolve.

Re:Tag this

[CastrTroy]

But that's because they only have a limited amount of money, and many other things to spend it on. Going to the movies now costs $12. More if you want to buy snacks. Most teenagers want a cellphone. That costs money. They spend money on video games, movies on DVD, designer clothes, and many other things. The reason kids don't spend money on music anymore, is because they have so many other things that they would rather spend their money on.

Re:Tag this

[MightyYar]

You don't think that "because they can get it for free" has anything to do with it? When I was a teeny-bopper, a CD cost $11 or so, but I only made $3.65/hour. I, too, had to choose between the latest Paula Abdul album or two $6 movie tickets. The difference was that it wasn't so easy to get a free album, and the CD single cost about half of what the full CD did. Sure, I had some Beastie Boys albums on tape from a friend's CDs, but I didn't have anything like Kazaa available. Even iTunes would have been a game changer... how many of those crappy 1-hit CDs did I buy when I could have just spent 99 cents or so for the one or two hit songs on the album?

I don't buy your argument, I guess. We had video games (Atari, Nintendo, Sega, TurboGrafix), we had movies (on VHS), we had designer clothes, snacks... the only thing that we didn't have on your list is cell phones!

Re:Tag this

[Lunarsight]

I will contemplate no longer boycotting EMI releases, provided they do cut RIAA funding. Emphasis on -contemplate-.

I like that EMI finally has 1) admitted that the lawsuits were a bad idea and 2) are actually planning to do something about it.

I do feel EMI should go a step further, though - and cut ties to the RIAA outright. If they were to form a separate legal group to represent their interests, it would really drive the point home that they've learned their lesson. Right now, I still suspect what they're saying is merely rhetoric intended to repair their tarnished image.

Re:Tag this

[sm62704]

"Nice" has nothing to do with it either. People consider strings of bits to be worthless. A physical object has value. Only the stingiest (or poorest) act as you say.

I pity people with that attitude. Most people really ARE honest, at least with people who are honest with them. But if you make them think you're trying to get one over on them, look out! That's the biggest problem the record industry faces - they're thievs and scoundrels who think that everyone else is a thief and scoundrel.