I would also like to extend my thanks to John, John, David and Terry for setting up this discussion list.
I am hopeful that things will change for the better with regard to artist compensation in the future and therefore could not agree more with Kristin on the alternative deal structures proposed below:
On Dec 14, 2003, at 2:00 AM, Kristin Thomson wrote:
I think it’s more likely we see: A) more “revenue sharing” models in the
future where labels give the artist a bigger advance or higher royalty rates
but, in return, the artist shares concert, merchandise and other ancillary
revenue streams with the label (stuff the labels don't have any control over
right now); B) the music industry becoming more like the movie industry
where musicians are more like freelance agents that shop their projects
around to labels on a case-by-case basis; or C) the opposite, where artists
will just stay away from the major label system entirely (as many, many do
now), maintain control of their copyrights and just make their own living.
But that’s another discussion...
The most satisfied creatives I have met are undoubtedly songwriters who for years have received a large portion of their compensation directly from the PROs. Like bond income, it is reliable and can be quite significant and wonderful.
So, given the lofty goal of attempting to set up an ACS that works, I believe that it would be unconscionable to direct the revenue into the pockets of the label system, and not create a fair and honest method for artists and writers to directly receive their streams directly from any new collection mechanism. As Kristin points out, artists are already seeking out alternative arrangements to bring their music to market in place of a traditional label deal. Perhaps the music company of the future will look more like management enterprises that derive the majority of their income from non-recording based activities. In some scenarios, the recording income becomes gravy on top of performance income and alternate publishing-related activities. The flip that is occurring where artists and their management retain control of their intellectual property and guide their careers without being dependent on financing and promotion from a label structure that never had, nor never will have, their best interests in mind is the way of the future.
It is my belief that the recorded music business as we have known it, is essentially over. It will continue to decline and eventually atrophy into a minor player squeezing out revenue from existing catalogs, and be replaced by a new enterprise more closely aligned with the realities of the digital marketplace and more enlightened with regard to IP and overall career development and integration. There is no upside in propping up the existing record label system as it collapses under its own legacy, inflexibility and denial. The upside for all people involved from the fans to the artists and writers to the businesses that will evolve to support them is in restructuring the relationships and dynamics of the music (and film and other media) business to correct what is broken and unfair and address a completely different marketplace than the one that was in existence when the original label constructs were formed.
Anyway, I think it's important to recognize the difficulties in assuming
that paying the copyright owners ie the labels will ensure that the creators
will be paid fairly, if at all. At this stage I think it's valuable to
consider other models that pay creators separately from, or parallel with,
current copyright holders.
We have already seen what happens when "new" revenue is received outside the usual flows that label contracts are designed to handle. For example, not a single nickel of the money collected (hundreds of millions of dollars) from the MP3.com settlement by the labels has not been paid to any artists. This was money collected for alleged "copyright" infringement by MP3.com. Where has all that cash gone? Similarly, the money collected from the current RIAA settlements against P2P users is earmarked for funding additional litigation to combat piracy, yet still is collected under the threat of copyright infringement. If the labels and the RIAA are not doing the bidding of the artists, whose works are at the root of and have funded every single dollar ever collected by the recording industry, then what exactly are they trying to protect?
There could be significant support at the grass roots level of artists and writers numbering in the tens of thousands for an ACS from which they might actually collect the proceeds. As Kristin also points out, artists with existing deals may have a difficult time ever extracting the ownership of their IP from their existing contracts. That indeed might be an impossible battle for most. However, the new artists and the artists of the future do not have to make the same choice, given well conceived alternatives. It is here that we can find the most fertile support.
Dave Kusek
Vice President
Berklee Media
Berklee College of Music
1140 Boylston St
Boston, MA 02215
617-747-8446 voice
617-747-2149 fax
dkusek@xxxxxxxxxxx
----------------------------
berkleemusic.com
berkleepress.com
berkleeshares.com