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Music The Almighty Buck

RIAA Accounting — How Labels Avoid Paying Musicians 495

An anonymous reader writes "Last week, we discussed Techdirt's tale of 'Hollywood Accounting,' which showed how movies like Harry Potter still officially 'lose' money with some simple accounting tricks. This week Techdirt is taking on RIAA accounting and demonstrating why most musicians — even multi-platinum recording stars — may never see a dime from their album sales. 'They make you a "loan" and then take the first 63% of any dollar you make, get to automatically increase the size of the "loan" by simply adding in all sorts of crazy expenses (did the exec bring in pizza at the recording session? that gets added on), and then tries to get the loan repaid out of what meager pittance they've left for you. Oh, and after all of that, the record label still owns the copyrights.' The average musician on a major record deal 'gets' about $23 per $1,000 made... and that $23 still never gets paid because it has to go to 'recouping' the loan... even though the label is taking $630 out of that $1,000, and not counting it towards the advance. Remember all this the next time a record label says they're trying to protect musicians' revenue."
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RIAA Accounting — How Labels Avoid Paying Musicians

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  • by CSFFlame ( 761318 ) on Tuesday July 13, 2010 @01:58PM (#32890434)
    deserves to get screwed. Seriously, go publish the songs yourself as an independent band. You don't need to be a record label to get it on itunes either (I think)
    • by santax ( 1541065 ) on Tuesday July 13, 2010 @02:04PM (#32890530)
      That is easy said. But I happen to make one part of my income with music... Can you press a nice looking album in good numbers? Can you distribute? Can you promote them? Those guys can... it is easy to fall for it. And Itunes? Well that is a product that attracts a certain kind of public. Not necessary a public that can see the difference between good music and a fucking promotion stunt... Hell, they buy their music on a medium where the Beatles have no place....... not that I am that big of a fan, but would you really buy music (as a real lover) in a store that doesn't have this part musichistory? It's easy said mate, but in the real world, those guys have all the things you need. And they are willing to sell it. They just don't tell you the real price. Don't get me wrong though, we agree, but this is not the musicians fault. Not at all.
      • by 99BottlesOfBeerInMyF ( 813746 ) on Tuesday July 13, 2010 @02:17PM (#32890738)

        Can you press a nice looking album in good numbers?

        No, but you sure don't need the RIAA for that.

        Can you distribute?

        That's the real trick, getting your music distributed in stores.

        Can you promote them?

        Yes, and even if I can't a publicity firm is a lot cheaper than the RIAA.

        And Itunes? Well that is a product that attracts a certain kind of public. Not necessary a public that can see the difference between good music and a fucking promotion stunt... Hell, they buy their music on a medium where the Beatles have no place.......

        That's just an inane comment. iTunes is a store. If some company decides for whatever reason they don't want to sell in that store, fine, but that doesn't mean "it has no place". You might as well argue "The Electric Fetus" record store is a store where Jaime Thietten has no place since she won't let a store with "fetus" in the name sell her music.

        ...would you really buy music (as a real lover) in a store that doesn't have this part musichistory?

        Yes. Like 99.9% of people, while I can't buy the Beatles albums there, I'm not going to let a boycott by one copyright holder over a trademark issue prevent me from doing business with them. That's just dumb.

        It's easy said mate, but in the real world, those guys have all the things you need. And they are willing to sell it.

        Wait, that's your argument. Well, the iTunes store is out because the Beetles catalog isn't there so I guess people have to be ripped off by the RIAA? Times are changing. There are numerous indie labels that will share the profits, print the music, and put your music in the iTunes store along with other places. The RIAA's strength has been in locking down the distribution channels and promotional channels (radio) but with the internet here, those methods are starting to fail. There are a lot of better ways for real musicians to make money than try to get a deal with an RIAA label.

        • Re: (Score:3, Interesting)

          by Lumpy ( 12016 )

          You dont need your record in the stores. Nobody buys music they never heard of in CD form from Walmart.

          Airplay? Get off your arse and get it out to small stations. you will NEVER get airplay on the clearchannel stations unless you pay them to play it. But if you get airplay on all the smaller stations that are dying for something the big channels dont have... you spread like wildfire.

          Get someone with real talent to shoot a video, get people to shoot "bootleg" videos at any concerts you play, get it on y

        • That's the real trick, getting your music distributed in stores.

          Actually that's half the trick and arguably the easier half. I have first hand experience in media distribution as both an industrial engineer and an accountant. First you need the capital to produce the physical media you intend to sell. Not many musicians have this kind of capital and you can't get it from a bank. Unit costs might not be bad but when you plan on selling CDs in the hundred thousands or millions the costs and logistics challenges increase in a non-linear fashion. Even ten thousand unit

      • by sarahbau ( 692647 ) on Tuesday July 13, 2010 @02:18PM (#32890758)

        Hell, they buy their music on a medium where the Beatles have no place....... not that I am that big of a fan, but would you really buy music (as a real lover) in a store that doesn't have this part musichistory?

        So you're saying that just because the iTunes store doesn't have The Beatles, that people shouldn't buy from there, or if they do, they aren't real music lovers? I guess if you had to get all of your music from a single source, and you needed to have The Beatles, then iTunes wouldn't be for you, but iTunes has tons of stuff that you can't find in any brick and mortar store, and even a lot that Amazon doesn't have. Any real music lover wouldn't limit themselves by not shopping at a store simply because they didn't have one artist. If they did that, they wouldn't shop anywhere, as no store has every artist.

      • by unity100 ( 970058 ) on Tuesday July 13, 2010 @02:22PM (#32890850) Homepage Journal
        well excuse me, but what good is a nice looking album distributed, promoted in good numbers going to do to you, if you do not even get $23 out of $1000, as per in the related article ?
        • Mod parent up. (Score:5, Insightful)

          by khasim ( 1285 ) <> on Tuesday July 13, 2010 @03:07PM (#32891560)

          Or, to quote Jayne,
          "Ten percent of nothin' is ... let me do the math here ... nothin' into nothin' ... carry the nothin'."

          But that's not the issue here. If you want to make money with music, become a studio musician.

          The RIAA is selling the dream of fame. You give them EVERYTHING and you get a shot at fame. And, as has been stated before, they could demand that you swim through a pool of sewage and if you refused, there would be someone else right behind you who would take that offer and think you were an idiot.

        • Re: (Score:3, Interesting)

          by Daetrin ( 576516 )
          It might get you laid. And it might also get you famous. And if you're both smart and lucky it might get you famous enough that you can ditch the original label and work out something a little more profitable. Not saying that signing a deal with an RIAA affiliated company is a great option, but it might be the best option if your eventual goal is to become a "big name" star, or if you care more about getting your music heard than you care about the money.
          • Re: (Score:3, Interesting)

            The state lottery can give you all that, with about the same chance of success. Do you purchase your lottery tickets regularly? If not, why would you make an exception for the music lottery?
        • Re: (Score:3, Insightful)

          by phantomfive ( 622387 )
          You hit the big time, and once you are famous, you have more negotiating power. As someone else mentioned, 18 out of 20 bands fail (economically), so it's hard to get a loan. Basically the production company fronts the money and in return gets all the profits for your first album.

          Once you are established, you can make better deals because people know you can deliver. Madonna isn't getting $23 out of every $1000. Beyonce is making real money. So is Shakira. The artists that can provably make money al
      • Re: (Score:3, Insightful)

        by beelsebob ( 529313 )

        That is easy said. But I happen to make one part of my income with music... Can you press a nice looking album in good numbers? Can you distribute? Can you promote them?

        No, but the point of doing all that is to get people to pay you to listen to your music... Why would you get the RIAA to do it when people won't pay you to listen to it, but pay the RIAA instead?

      • by PopeRatzo ( 965947 ) * on Tuesday July 13, 2010 @02:33PM (#32891024) Journal

        Can you press a nice looking album in good numbers? Can you distribute? Can you promote them?

        Of course you can do all of those things without the RIAA or even a record label. And you can do it a lot cheaper. If you've ever seen an expense sheet from a label trying to justify not paying musicians (I have) you wouldn't believe how much labels claim stuff costs. When you do a tour of 5 college campuses and the label says they paid $20,000 to promote the shows when the only promotion that was done was using free spots on college radio stations and printing a single black and white flyer, you realize you're being screwed.

        Further, it is quite possible to work with a record label but not with the RIAA. There is no such thing as a "standard contract" and if a label exec tells you that something in a contract is "standard language" run for the door. There are labels out there that will make all sorts of agreements, including I have learned from direct experience, letting the composer license the music via Creative Commons (which, by the way, is not a free license unless you make it so).

        And creating your own label has never been easier or more economical. There has been absolutely no need for big record labels since at least 2003, but they keep going because of inertia and uninformed artists. More and more, the big labels are nothing but factories for wholly-fabricated "artists" like Lady Gaga or the finalists of American Idol. They simply skip over dealing with "artists" by fabricating their own. And this does not only apply to pop trash like Gaga. A lot of what's passing for rock and heavy metal is just Archies-style fabricated groups made up of out-of-work actors who basically lipsync and pretend to play their instruments while backing tracks play in concert.

        The big music industry has been in its death throes for some years now. The corporations have already socked away the profits and are only padding their quarterly reports now until the end, when they'll just transition into some other scam. Maybe "internet television".

        • by VTI9600 ( 1143169 ) on Tuesday July 13, 2010 @06:14PM (#32893630)

          More and more, the big labels are nothing but factories for wholly-fabricated "artists" like Lady Gaga or the finalists of American Idol.

          How exactly was Lady Gaga "wholly-fabricated" by big labels? Unlike many other pop stars, she writes all of her own songs and, by most accounts, earned her success through the merit of own performance. She admits that her music is pop but challenges the idea that there's anything wrong with that. Before signing with the behemoth Interscope, she signed with the small, no-name label created by Akon. Sure, her music sounds like it was made in an electronic pop-factory but that doesn't necessarily reflect on her personally.

          And as for American Idol, that's the whole point. It's a show about taking someone out of complete obscurity and making them a star, and people love it. There's no skulduggery going on's a case of people asking the industry to fabricate a star for them and then getting exactly what they asked for.

          • by PopeRatzo ( 965947 ) * on Tuesday July 13, 2010 @08:09PM (#32894524) Journal

            How exactly was Lady Gaga "wholly-fabricated" by big labels?

            Did you hear anything about Lady Gaga's work before her first album?

            She was an art student from Tisch who was groomed by an Interscope farm label for eventual Madonna-style splash. Her past "DJ-ing" was basically done during her grooming by Interscope. She was picked on the basis of her "conceptual art" projects at Tisch.

            I know her vocal coach from her Interscope days. She was turned from a DJ and club kid into a "singer" during those days.

        • Re: (Score:3, Interesting)

          by phantomfive ( 622387 )

          More and more, the big labels are nothing but factories for wholly-fabricated "artists" like Lady Gaga or the finalists of American Idol. They simply skip over dealing with "artists" by fabricating their own. And this does not only apply to pop trash like Gaga. A lot of what's passing for rock and heavy metal is just Archies-style fabricated groups made up of out-of-work actors who basically lipsync and pretend to play their instruments while backing tracks play in concert.

          This has always been a complaint, and it's been that way for longer than I've been alive. The music industry has been dirty for over a century.

          The thing about these 'music factories' and production companies is that now they are really good, a lot better than most artists. Look at this piece of pop trash, [] Can't be Tamed by Miley Cyrus. Start with the video, it's top level polished Hollywood quality. Cynical yes, but top level. How often do you see wings like that? The backup dancers are good, better

      • Well for all that (Score:4, Interesting)

        by Sycraft-fu ( 314770 ) on Tuesday July 13, 2010 @03:08PM (#32891580)

        I suggest you talk to Stardock Systems. They are an indy software developer. Because of problems regarding publishing, they self published their last title, Galactic Civilizations 2. You can find it in just about every major game seller (though on the budget rack now because it is like 5 years old now). They are doing so again with their next title, Elemental. For that matter, they've published two titles for other companies, Sins of a Solar Empire by Ironclad and Demigod by Gas Powered Games. If this keeps up, they may not be an indy studio in 20 years.

        No big development or advertising budget, no attachment to a major publisher, just some guys from Michigan that can make a good game and get it out there. You can ask them who did the distribution, they'll tell you (they posted it I just forgot who it was).

        Or, if videogames themselves don't work for you, how about Red vs Blue? Popular animated show made using the Halo engine. Started off as a few friends who like video games and cinema putting out products using a few Xboxes in the middle of the night while working real jobs and some donated web space. Now? You can buy the videos on Xbox live and the DVDs in Best Buy. They have their own company, with health insurance and everything. It is basically their full time jobs. The make money on t-shirts, DVDs, and people who subscribe to their site.

        You are not required to work through the established system, unless you want to. Doesn't mean there isn't more work or risk to be taken on, but then there is more reward too. If you are lazy and just want to sign on the dotted line, well ok but then I don't really want to hear it from you.

        Also there are intermediate options. Go to, they can hook you up. One of the students that used to work here has a band on there. They handle publishing and distribution for you, and take a very reasonable cut. No, they won't get you in Best Buy. However they also won't fuck you. Also, if that is important to you to be in stores, well then look in to publishing and distributing agencies. They exist. Like I said, ask Stardock who they used. Probably videogames driven, but they might do music too.

        If you want to make it big, then consider that some real effort may be needed on your part. If you look at most of the super rich business types out there, it was a combination of luck and a lot of hard work. Gates, Jobs, Buffet, Rockefeller, and so on, all had to do a shitload of work to get where they are. For all of them, there are countless more who worked had and got rich, but not so rich that we've heard about them, and still more who worked hard and just had a regular life. So I don't see why you should expect music to be any different.

    • by JavaBear ( 9872 ) * on Tuesday July 13, 2010 @02:07PM (#32890606)

      Actually the artists are locked into the main labels, because indies apparently don't get the same air time as RIAA members do, definitely not in the prime time, on the main broad cast stations.

      I don't know about iTunes.

      • by BoberFett ( 127537 ) on Tuesday July 13, 2010 @02:23PM (#32890864)

        How many bands get airtime at all? When I listen to the radio, it's the same handful of songs playing over and over and over. Any small band who signs with a RIAA label hoping to get big might as well sell their instruments and buy lottery tickets. They've got about the same chances of striking it rich.

        • Re: (Score:3, Insightful)

          by Drishmung ( 458368 )
          What is this 'radio' of which you speak?

          I seem to recall such a thing in my youth, but now, there is nothing worth listening to.

          That's the real problem---finding new music. The last radio station I enjoyed was run by a record producer who did it for love and as a vehicle for his ego. Sometimes you'd listen and all there was would be a drunken rant, in which case---come back tomorrow. The rest of the time was a vast amount of amazingly diverse material, old and new. Most of which was OK, some of which I ha

    • Re: (Score:3, Interesting)

      Lady Gaga.

      She even has one of those "360 degree" contracts.

      Let's see what happens to her.

    • by lawnboy5-O ( 772026 ) on Tuesday July 13, 2010 @02:13PM (#32890698)
      That's more possible now, but back in the day, not a chance.... I have friends dying from depression and destitution because the were snookered by some exec, cut an album or two, never got paid, and then sued for no fulfilling the contract otherwise primarily because the couldn't eat, got sick, and to this day owe money to some one for their intellectual property.
    • by b4upoo ( 166390 )

      How about we create laws to put people who take advantage of others under the prison! These music middle men should be regulated and closely studied to make certain that their "work" does benefit the content creators.
                                Frankly there may be a day when it is so easy to master and produce a CD that the middle men are thrown in the trash.

    • by N0Man74 ( 1620447 ) on Tuesday July 13, 2010 @02:30PM (#32890986)

      Yeah, just like anyone who doesn't take the time to learn self-defense courses deserves to get beat up!

      Listen, some of us may know what kind of deceitful manipulative wankers these guys are, but the general public is woefully unaware at just how underhanded the entertainment industries can be. We're talking about industries that know how to manipulate audiences and manufacture appeal among the masses... They know a thing or two about promoting images, including their own.

      While I do wish more artists were better informed about what type of deal with the Devil they were making, but it's no excuse for how they get screwed over.

      This whole scene is a mess. Big Labels have way too much control of what music people actually get exposed to, and the chances of making it anywhere without them are pretty slim. Even with the knowledge of how badly they treat the artists, some will still succumb because they feel it's their only real choice.

      It's easy to say "just start an indie band", but what matters is not how many indie bands there are out there, but how many indie music customers there are out there. It's the buyers that make the difference, not the artists, and unfortunately I have little faith in the mass of sheep.

      • by jedidiah ( 1196 ) on Tuesday July 13, 2010 @03:25PM (#32891830) Homepage

        > Yeah, just like anyone who doesn't take the time to learn self-defense courses deserves to get beat up!

        No. If you decide to go fight in the Kumate without doing so much as taking a Karate class at the local Y then you deserve to get pummeled.

        If you go chasing fame, perhaps you should get yourself a clue and figure out how to do it right.

      • Re: (Score:3, Insightful)

        by BoberFett ( 127537 )

        "the chances of making it anywhere without them are pretty slim"

        The chances of making it anywhere WITH them are pretty slim too. So what have you go to lose by doing it without them?

  • Albini's story redux (Score:5, Informative)

    by 192939495969798999 ( 58312 ) <> on Tuesday July 13, 2010 @02:00PM (#32890460) Homepage Journal

    Reminds me of this horrific classic of how recording artists get ripped off: []

  • Well duh. (Score:5, Funny)

    by Arancaytar ( 966377 ) <> on Tuesday July 13, 2010 @02:00PM (#32890468) Homepage

    The RIAA can't very well claim to be protecting the starving artists if the artists aren't starving.

  • by nimbius ( 983462 ) on Tuesday July 13, 2010 @02:04PM (#32890528) Homepage
    someone has got to play devils advocate. the latest round of carefully cultivated pop stars and rock bands could very well be designed from their inception to be too outright stupid to determine how this scheme works. Rap stars are groomed and trained to pay attention only to the lambos, the parties, and the mansions. the quick-change mainstream music is where the RIAA is getting the most bang for their buck, and despite some artists attempts to buck the trend by creating their own labels their efforts are sadly misplaced. anything in the industry that so much as glances at a musical instrument is shackled to the wagon of the RIAA and regardless of whether artists select an independent distribution channel or the more commonly recognized channels its extremely difficuly to avoid paying at least some funding to the RIAA.
    • by MightyMartian ( 840721 ) on Tuesday July 13, 2010 @02:19PM (#32890778) Journal

      That may apply in some cases, but one case I have been following (mainly because I'm a huge fan) is Robert Fripp's multiyear odyssey to get UMG to give him a proper accounting of King Crimson's royalties. He has fairly good evidence that the band has not been properly paid out, but because of the complexity involved due to the mergers and buy-outs and such of publishing companies and the like, whether through maliciousness or incompetence, he and his band have been screwed. What's more, there is some pretty good evidence as far as online sales go that King Crimson has not seen royalties at all, and worse, in many cases, the artists were never even asked, despite a good deal of control over the release of recordings that the Crimson still holds. Fripp tried for some time to get to talk to someone, anyone, in a position of authority who could produce an accounting of earnings and royalties, and finally had to sue UMG, and only now is he finally getting some movement.

      The general methodology of UMG, at least, is to delay, obfuscate and obstruct, claiming at times that it can't answer questions from subordinate companies, or forcing artists to deal with individuals who ultimately have no authority to answer or compel someone else to answer the artist's requests. While I suppose it could be colossal incompetence, I posit that the system is purposefully set up to steal money owed to artists.

      The same thing has happened over at EMI, where the Beatles have been forced to sue over withheld royalties. I'm assuming every record company and major label probably uses the same tactics to screw over artists.

  • Not exactly news (Score:5, Informative)

    by BBTaeKwonDo ( 1540945 ) on Tuesday July 13, 2010 @02:04PM (#32890540)
    TFA is heavily based on a Courtney Love speech from 10 years ago at [] . Prettier charts in TFA, though.
    • You beat me to that link! I was about to post that link myself! It's definitely worth a read and very enlightening. I'd mod you up if I could, just so more people would see it.

  • Um, um... (Score:5, Insightful)

    by rickb928 ( 945187 ) on Tuesday July 13, 2010 @02:05PM (#32890548) Homepage Journal

    "Remember all this the next time a record label says they're trying to protect musicians' revenue."

    I haven't thought that labels were trying to protect musicians' ANYTHING since 1972. And it wasn't true before that.

    • Re:Um, um... (Score:5, Interesting)

      by pilgrim23 ( 716938 ) on Tuesday July 13, 2010 @02:43PM (#32891222)
      Speaking as a former "artist", who, to be published, had to sign a contract that reminded one of a ransom note or the plans Genghis Khan drew up for the fair treatment of a raised city... I am somewhat familiar with the industry. Our record sold moderately; not great but OK. It earned a few hundred thousand and I have a photocopy of my one royalty check for a whopping Twenty Bucks! Some years later I got the ASCAP rights for one of my songs reassigned to me, because the label had inadvertently let it lapse after 20 years. That search and work cost far more then I ever earned from it. But it was the principle of the thing. I am very happy the Internet is raining on the parade of these ghouls.
  • So question (Score:3, Insightful)

    by easterberry ( 1826250 ) on Tuesday July 13, 2010 @02:05PM (#32890552)
    if all the bands end up with 0 dollars how does MTV Cribs work? Like, most chart topping musicians have boatloads of money, if they're getting screwed down to nothing where is that coming from?
    • Re:So question (Score:5, Informative)

      by binkzz ( 779594 ) on Tuesday July 13, 2010 @02:08PM (#32890626) Journal
      Concerts and merchandise. Not CD sales. That's why Radiohead had no problems giving away their songs for free online.
      • MTV Cribs (Score:5, Insightful)

        by tekrat ( 242117 ) on Tuesday July 13, 2010 @02:14PM (#32890702) Homepage Journal

        I think everything on that TV show is rented. I cannot believe that skateboarding hot-kid-of-the-month can afford a McMansion, 18 Escalades, a room full of arcade machines, yadda-yadda, from 2 or 3 endoresement deals when he will be old and stale before the year is out.

        Either that, or the repo men have a heck of a time 6 months down the road.

        That TV show, just like *everything* on TV is totally fake.
        It's just not possible given the realities of these situations.

      • Re: (Score:3, Interesting)

        by Enry ( 630 )

        In a grocery store that would be called a loss leader. Have something that you make no money on, but build up enough interest in something else that they'll buy it for enough money to make up the loss and then some.

        In this case, you basically give away the CDs and the RIAA screws them over. But in the meantime, they're making a shedload of money from touring.

        I don't want to deny the RIAA is screwing them over, but without the RIAA, they wouldn't be on tour to make the money.

        Me, I'll just keep paying for a

    • Re: (Score:3, Insightful)

      It's not their money, it's the label's.

      The labels have to show a few musicians that at least appear to be rich. Otherwise no one would ever sign with them.

    • by Zerth ( 26112 )

      Loans against future revenue. Just show the bank a million dollar check from the label and don't tell them that the label makes you spend 75% of it on your next record.

    • Hos. They be pimping they stable of fly bitches like crazy mofos, playa.

  • Thats where they take back a percent of the costs to account for breakage of the medium. Of course, ever since we switched from vinyl records to plastic cd's, the actual breakage is about ... nil.
  • by _0rm_ ( 1638559 ) on Tuesday July 13, 2010 @02:17PM (#32890750) Journal
    Pot meet kettle.
  • Hear, hear! (Score:5, Interesting)

    by jemenake ( 595948 ) on Tuesday July 13, 2010 @02:19PM (#32890792)
    I read "Confessions of a Record Producer" where the dude gives you the step-by-step breakdown of where all of the money goes. One of the interesting ones is that the record companies now take out more for every CD pressed than they did for pressing LP's or cassettes, even though it's actually cheaper to make CD's.

    He said that, every time he'd be at a cocktail party and someone would find out he's a record producer, they'd always ask "So, if I made an album that went gold, how much money would I get?". He proceeds to go through the cost accounting (which he describes earlier in the book) to arrive at some number like a 4-piece band making a gold record results in each member getting something like $23,000 or something. Don't quit your day job, fellas!

    Also, back when Napster was really rolling, and the RIAA was freaking out, I recall reading an article by Janice Ian (a 70's 3-hit wonder) saying that she never got a statement from her record company that didn't say that she owed them money.

    If you watch the RIAA's behavior carefully, you'll see that they're not really about attacking "piracy". They're trying to prevent any kind of delivery mechanism which takes them out of the loop... that connects the artist directly with the listener. "Disintermediation" is the big word for it. I recall several years back, there was a website (I forget it's name) where unsigned bands could post their songs as mp3's and they'd tag them with what known bands they thought they sounded like. So, you could go on there and search for "Dead Milkmen" and you could find all of these undiscovered bands who were influenced by them.
    ... and, of course, the RIAA figured out how to sue them into oblivion, even though they weren't really infringing on copyrighted material.
    • Re:Hear, hear! (Score:4, Interesting)

      by SixAndFiftyThree ( 1020048 ) on Tuesday July 13, 2010 @05:53PM (#32893468)

      Also, back when Napster was really rolling, and the RIAA was freaking out, I recall reading an article by Janice Ian (a 70's 3-hit wonder) saying that she never got a statement from her record company that didn't say that she owed them money.

      If you watch the RIAA's behavior carefully, you'll see that they're not really about attacking "piracy". They're trying to prevent any kind of delivery mechanism which takes them out of the loop... that connects the artist directly with the listener. "Disintermediation" is the big word for it.

      Yes, I read Janis' article too. Search for "The Internet Debacle" to find it. She now sells CDs direct from her web site, and tours.

      Fifteen years ago I lived upstairs from a guy who managed a jazz orchestra (and played drums). He put it in a nutshell for me. "There's a minimal price people will pay for just good music. If you want to make more than that, you have to be famous." He knew the big labels had the power to make his band famous, and that there were other bands out there who could play good music too. But he had more of a business head on his shoulders than 99% of musicians, so he didn't sell his band down the river in the hope of being made famous. And I learned that a band that doesn't have a big contract and isn't famous can sound just as good as one that has and is.

      The fundamental problem was pointed out two or three years ago by some big dude from Yahoo!. As he put it to a room full of RIAA suits, the physics have changed. Disintermediation can no longer be prevented. Bands can get famous on YouTube. The artificial scarcity that RIAA exploited no longer exists, because it was a scarcity of information: there were ten thousand bands out there and the only way for me to learn which ones I would like was via some channel that RIAA controlled. Now there are more channels for information than anyone can control, this side of Beijing.

      All the more reason for RIAA to screw even more out of the few artists they still have a legal clamp on. They now try to get artists to sign a so-called 360 contract, where the company takes the revenues from touring and gives the artist a few crumbs of those. And of course some artists fall for it.

      What's left for the RIAA? People who don't care whether the music they're listening to is good music as long it's famous, as long as it's what the people around them are listening to. In a word: teenagers.

  • by Anonymous Coward on Tuesday July 13, 2010 @02:20PM (#32890800)

    Let me tell you how it will be;
    There's 23 for you, 977 for me.
    'Cause I’m the RIAAman,
    Yeah, I’m the RIAAman.

    Should zero per cent appear too small,
    Be thankful I don't sue you all.
    'Cause I’m the RIAAman,
    Yeah, I’m the RIAAman.

    And you're working for no one but me.


  • by Demonantis ( 1340557 ) on Tuesday July 13, 2010 @02:21PM (#32890826)

    by Simon, Jul 13th, 2010 @ 9:41am But stronger DRM laws will fix this, right?

  • by Securityemo ( 1407943 ) on Tuesday July 13, 2010 @02:25PM (#32890894) Journal
    Jack Chick was right about the music industry, just not in the way he thought he was.
  • Even rappers, who do nothing more than chant to a monotonous beat, live in multi-million dollar estates.

    If no-talent street thugs make that kind of money, how bad could the situation be?

  • Nothing new here (Score:5, Informative)

    by mbone ( 558574 ) on Tuesday July 13, 2010 @02:27PM (#32890928)

    Absolutely nothing new here.

    Steve Albini [].
    Courtney Love [].

    Both, I believe, 10+ years old.

  • The majority of artists never record an album. Most play in your local bar, at your wedding, in parks. The number of artists that actually get picked up by a label are less than a fraction of a percent. They are not picked up because they are any good, they are picked up because they are marketable.
  • by Drakkenmensch ( 1255800 ) on Tuesday July 13, 2010 @02:34PM (#32891034)
    ... is whoever actively worked to make Justin Bieber a star.
  • by fermion ( 181285 ) on Tuesday July 13, 2010 @02:40PM (#32891138) Homepage Journal
    Most people take on debt to survive. They have mortgages, car loans, credit cards. At the end of the month, after paying all debts and necisities, most people have no money left. Even after years of work, one might have a few non liquid assets, but most people have net debt.

    Why celebrities should be so special as to take huge loans and live lavishly and then end up ahead is a question no one seems to want to ask. If I were allowed to take a multimillion dollar loan against future earnings my life might be much better. I certainly would have difficult paying it back, but even living off the investment I would have more money. Such a loan might return more in investment than the average income

    So record labels are loan sharks giving away money in exchange for future earnings. Some might not be able to pay back the loan. Well, boo hoo. Millions of Americans are in the same boat, with things such as pay day loans, but don't have the life style that these guys do. It is why people see how much Madonna has, and how little they have, and find it hard to understand how listening to one of her songs without a license is stealing. Does she still have a house?

  • "Own your own stuff" (Score:3, Interesting)

    by Animats ( 122034 ) on Tuesday July 13, 2010 @02:44PM (#32891226) Homepage

    "Own your own stuff" - Joan Jett

    Jett had, and has, her own record label. Worked out very well.

    Also notable: Mick Jagger, London School of Economics '63.

  • by thedbp ( 443047 ) on Tuesday July 13, 2010 @03:20PM (#32891770)

    The Problem with Music [] by Steve Albini []

    Looks like Courtney Love pilfered a lot of her article from Mr. Albini (that doesn't surprise me one bit), which really adds a nice rich chocolatey irony sauce to the whole thing.

  • by erroneus ( 253617 ) on Tuesday July 13, 2010 @03:44PM (#32892132) Homepage

    It's really as simple as that. All manner of other practices have been outlawed in the past. Most of these have been associated with other forms of paid labor where [big] business had been taking unfair advantage of individuals. Making law against these unfair and unethical practices as described in the articles both current and previous would just seem reasonable and fair.

    Of course there would be campaigns against this, but they certainly couldn't spin this by saying "the artists won't get paid" in this case.

    Still, these descriptions of how the MPAA and RIAA are essentially using accounting tricks to avoid paying people need to be repeated often and in a way that the average person can understand. I hate to say it this way, but this is exactly what people mean when they say someone was "Jewed out of what they are owed/deserved." That expression did not come out of thin air.

    "Money games" need to be brought under control. Obvious targets for control that people largely agree with are loan sharks... already illegal in most places. Also in the sites of many laws in many states are those "pay day loans" activities. The people already pretty much agree with this because they understand it and why it's bad. Now we just have to expand that existing understanding to include the MPAA/RIAA as "bad organizations" that need to be limited and controlled.

    Once this gets better understood, I think it would be hard to get juries to award millions of dollars for sharing data on a P2P connection.

  • Donald Passman (Score:5, Interesting)

    by Scareduck ( 177470 ) on Tuesday July 13, 2010 @04:01PM (#32892330) Homepage Journal
    Donald Passman's All You Need To Know About The Music Business [] details all this stuff. They can still rip you off, for example, for breakage (because shellac recordings are fragile!). Nothing is simple, and the contracts are intentionally impenetrable. Great, great book for anyone trying to break into the record business, though I suspect its advice may well be very dated at this point.
  • by DynaSoar ( 714234 ) on Tuesday July 13, 2010 @04:08PM (#32892418) Journal

    Educate yourself with something like []

    Then get a lawyer to go over the contract. They only "still own the royalties" if you assigned them all rights. Keep your rights but assign them one time plus compilation rights but keep others and specify your desired pay-off rate. If they don't go for it, take the contact as you want it worded to other producers until you find one that will take it.

    Or do it yourself. There are not only self-producing musicians online, there are self-producing bands that are also online collaborations. They can live on different continents and never meet. Music production has left the building and gone to everyone's homes. The MafIAA was the first against the wall when the revolution came, but they were too brain dead to realize it.

  • by BitHive ( 578094 ) on Tuesday July 13, 2010 @04:40PM (#32892770) Homepage

    If the recording industry was really so oppressive, artists would find other ways to make more money. Free market capitalism is defined as the naturally occurring optimal distribution of resources. Stop trying to destroy what you don't understand.

  • by rlh100 ( 695725 ) on Tuesday July 13, 2010 @05:15PM (#32893160) Homepage

    Moses Avalon is a record company insider who has written some very funny books about the industry:
                    Million Dollar Mistakes
                    Confessions of a Record Producer
                    Secrets of Negotiating a Record Contract (maybe not funny, have not read it)

    On his web site he as a royalty calculator that allows you to plug in numbers for a recording contact and see how much the band will make:
    It includes standard things in record contracts such as 10% record (CD) breakage and 23% production costs. He gives hints how to maximize the return to the band. At standard record industry contract terms with no advance to the band you have to sell over 3/4 of a million records in order to break even. This assumes the band has already recorded the album. Need an advance to do that, then you have to sell more albums in order to break even. It is fun to play with and the hints are funny and eye-opening. His basic point is that the only money the band is likely to see is the advance. So get as large an advance as possible and spend as little of it as you can.

    At one time he had an article about the economics of a record contract and touring to support it and the end result is that for the hours the band worked, they would make the same money flipping burgers at MacDonald's. And this is for a band with a million selling record.

    Now I do not know how this translates to itunes sales but I would not be surprised if itunes sales still have a 10% breakage allowance.

    Moses is a very funny author to read.


  • by AdamD1 ( 221690 ) <adam@brainr[ ]com ['ub.' in gap]> on Tuesday July 13, 2010 @06:25PM (#32893726) Homepage

    I'm seeing a lot of dismissive comments in here about what labels allegedly do and how much easier it will be for an artist to do it themselves. Also a lot of hyperbole about "if they're getting ripped off, how come they're so rich"?

    Let's say you are a good songwriter and performer, and you've shelled out your own money to record a handful of songs to a reasonable enough quality that a consumer would buy it if they heard it. You have no management. You have no agent. You have confidence and this product that you've agonized over. You don't want to go the major label route. You my distrust labels of any sort. You possibly have a deep dislike for the RIAA.

    To get on iTunes, you used to have to be signed to a label of any sort who would represent your recordings so that iTunes would add it to their catalogue. That was from whenever iTunes started to around 2005 or so. That has been loosened somewhat so now an artist can go to CDBaby, who still require a CD of your work before doing so, and will only represent one (1) song to iTunes.

    Once that song is actually in iTunes, now what? It doesn't just show up on the front page. In fact depending on which country you're from, you won't automatically show up in other countries on iTunes thanks to 100+ year-old physical distribution laws.

    But what do you do? You can't simply persuade iTunes to feature your product on their service, not on your own. They have a staff who essentially act like retail used to: they "front rack" products. They do this based on the pedigree of the recordings coming in and a considerable amount of marketing push from the majors. I'm not privy to that major label process, but I can tell you there are thousands of indie artists who are having a very hard time getting any kind of meaningful exposure via iTunes without that same attention and manpower.

    Tunecore - a sort of ex-major label A&R and promotions collective - will represent a completely independent artist but they still essentially only seek out artists with some kind of touring career already in place. They promote to iTunes essentially like a major label would.

    It is also not that easy to sell your music - even if you're really good - without a lot of physical effort on your part. Touring. Actually pressing CD's and making them attractive and inexpensive enough that even one person would be intrigued to buy one. I don't know many people who buy CD's at all, and that includes at shows. They'd sooner buy a T-Shirt, so the artist also has to make sure they get good at shirt manufacturing. (Something few musicians assume they should know anything about.)

    If your goal is just to write and perform music and possibly make a little bit of cash for fun, sure. You don't need a label. If you want to have a career at it, you may not need a label but you will need lots of other representation. Managers, agents, promoters, etc. You'll still need some financial backing to get a world class recording, and at that point you still need to answer the question of how you'll be properly exposed on iTunes. It is not nearly as easy or straightforward as many of these commenters are indicating. To have a genuine certifiably successful career? Labels are still good at that, they've just lost their taste for putting three albums worth of nurturing effort to get there. Your first album has to hit. Otherwise they will just move on. That wasn't always the case.

    Comparing marketing options for a new, unknown artist who is bewildered as to what to do with their brand new music career without labels and an artist like Robert Fripp who started touring in 1966, and has released several dozen albums on a variety of internationally distributed record labels and built up a loyal audience spanning over 40 years now is (to put it mildly) apples and oranges. Same goes for Nine Inch Nails and Radiohead. Name me an artist that has succeeded on par with these artists in today's climate without a label, and I'll be interested to hear about it. Even Trent Reznor's attempt to marke

    • by shitdrummer ( 523404 ) on Tuesday July 13, 2010 @11:40PM (#32895722)
      Bullshit. I and many friends of mine have songs and albums on iTunes. None of us are signed. We also have our music for sale/streaming on about 10 other site. We all set this up ourselves, no middle-man required. Although there are services that will distribute you music to any of the online sale sites for a fee or cut of your profits.
  • Justi curious (Score:3, Interesting)

    by koolfy ( 1213316 ) <koolfy@gma i l . c om> on Tuesday July 13, 2010 @06:30PM (#32893788) Homepage Journal
    What do you guys think of spotify ?

    Honestly, I suscribed for a premium account two weeks ago, and I love it, but even if it's the best way to enjoy legally copyrighted music without spending all the money I have on every single track of the 80 000 [] ones I listen to, I'm still not sure it's the best way to pay artists back.
    I know the more people use and buy premium accounts on spotify, the bigger the share that spotify gives to the "artists" (in reality it's given to the Labels...), but there is no proof that those Labels give a fair amount to the artists.

    So, what do you guys think of the Spotify option ?

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