Latest Indie News
Welcome to every major label's worst nightmare. Universal Music Group (UMG) is now facing the real possibility of mulitple class action lawsuits alleging they short-changed artists of royalties owed for digital downloads and ringtones. This week, the combined force of Rob Zombie and the estate of Rick James cleared a legal hurdle for their class action suit filed in April, and Chuck D introduced a fresh lawsuit making similar claims. UMG hopes to have both suits treated as breach-of-contract disputes since, if allowed to move forward as class actions, they can conceivably include all UMG artists.
Public Enemy - Welcome[s UMG] to the Terrordome (Fear 2011)
Both lawsuits are based on similar claims: are digital downloads and ringtones are not sold, ar as the labels have claimed, licensed? The latter pays artists 10 - 20%, as opposed to sales which contractually returns as much as 50% to them.
As noted in The Hollywood Reporter, an earlier suit brought by Eminem established a legal precedent for the artists claims. On Tuesday, UMG faced a setback to their request that the suit brought by Rob Zombie and the estate of Rick James be treated as breach-of-contact disputes and dismissed in order to avoid the broader implications of a successful class action suit. However, a federal judge in California said that the case should continue with further fact-finding and could go before a jury.
According to The Wrap, Chuck D's freshly filed class action suit not only addresses the 50/50 split but also claims that UMG has made deductions for such non-existent expenses as containers and packaging. Chuck D is pushing for a jury trial and, given the damaged brand of major labels, jury selection would be quite an intense process.
Huge amounts of money are involved:
"According to Ridenhour's claim, under UMG's current method of accounting, artists and producers receive $80.33 for every 1,000 downloads, when the correct amount should be $315.85 per 1,000. On the ringtone side of things...The suit claims that UMG's current accounting method yields $49.89 per thousand downloads, as opposed to the $660 per 1,000 that the suit claims is actually owed."
But this is not just a problem for UMG, given the similar approach taken by other labels. Dave Kusek did some "quick and dirty math" back in March when Eminem's lawsuit was moving forward and estimated that money owed to artists for iTunes sales alone could amount to $2.5 billion dollars.
If these class action suits are successful, the financial implications to record labels are potentially ruinous, especially for deals signed prior to the early 2000's, as noted by Dave Kusek.
Hypebot contributor Clyde Smith maintains his freelance writing hub at Flux Research and blogs at All World Dance and This Business of Blogging. To suggest topics for Hypebot, contact: clyde(at)fluxresearch(dot)com.
If you're developing a product or service in the music tech or musician services sector, you're about to miss an essential deadline. SXSW Accelerator provides a highly visible showcase before industry experts, early adopters, Angels and VCs. Last year SXSW launched a special music tech category.
This year's music Accelerator event takes place on March 14th as a part of SXSW and the deadline to register is November 18th, just two weeks away. Get details here: http://sxsw.com/music/startupvillage/accelerator.
(UPDATED) This guest post comes from Kristin Thomson, of The Future of Music Coalition.
Recording artists and indie labels: there¹s a movement afoot to change the way that you would receive your digital public performance royalties, and it¹s not a good one, especially for recording artists.
In recent days, the artist community ‹ including AFTRA, AFM, The Recording Academy, A2IM and SoundExchange‹ has been broadcasting the message to their members about the negative consequences of direct licensing deals for digital performance royalties. We applaud our artist colleagues for urging their members signed to indie labels (or self-released artists) to not accept these direct licensing deals.
We here at FMC wanted to join in the chorus and explain to musicians and labels why the current statutory licensing structure is better for all stakeholders.
1. Direct payments to artists put at risk
Currently, Sirius/XM pays digital public performance royalties to SoundExchange for the music it plays; SoundExchange then distributes 50 percent of the royalties to the sound recording copyright owner (usually a label) and 45 percent to the featured performer. The non-featured performers receive the remaining 5 percent.
Under the current structure, the money doesn¹t pass through the record labels first; payments to performers are made directly and simultaneously, which means the performer gets his/her money for the digital performances whether they¹ve recouped or not.
If labels start to license to Sirius/XM directly, artists will no longer be paid directly and simultaneously via SoundExchange. Instead, their digital performance royalties would be passed through their label.
FMC has always argued that direct and simultaneous payments to artists is a good thing. We have lots of upstanding label friends, but history is littered with instances of labels not properly accounting to their artists. Direct licensing simply lacks the same level of transparency that¹s available to artists when receiving a check directly from SoundExchange.
Even though it presents a huge logistical challenge to SoundExchange to seek out all the performers who are owedmoney, FMC thinks artists being paid directly is absolutely critical.
2. Artists and labels are paid more under the current structure
How muchSirius/XM pays SoundExchange is based on a rate set by the Copyright Royalty Board with input from stakeholders, in compliance with federal statute. Currently,Sirius/XM pays 7.5 percent of its gross revenue. The rates are currently set through 2012, after which they will be revisited to cover a period from 2013-2018.
Direct licensing deals means that Sirius/XM might pay a little bit less. While this might generate some savings for Sirius/XM, it¹s clearly not good for labels OR artists.
Then there¹s this. Billboard reportedin August:
"The question arises if the labels will pay the artist half the royalty, or 50 percent, they receive for each time a song is played, or will some labels choose to pay them their artists the regular royalty rate, which typically ranges between 15 percent and20 percent".
Yep. There¹s also a chance that, under this direct licensing arrangement, performers would see their royalty rates reduced. FMC cannot support such efforts to devalue the price of music.
3. Direct licensing deals leave musicians without a voice
SoundExchange is governed by an 18-person board that includes 9 artist reps and 9 label reps. That means that musicians and labels have an equal say in how SoundExchange operates. (Remember, this is an organization that just paidout $88 MILLION in one quarter, so we¹re not talking about chump change.
SoundExchange also has the power to audit licensees like Sirius/XM on behalf of everyone and make sure that they are paying correctly. If labels start to direct license, any errors made by Sirius/XM during playlist reporting would be much harder to discover, and only the biggest labels would have the resources to audit. We are more powerful collectively than we are separately.
If digital performance royalty payments are routed around SoundExchange, artists will lose a voice in the discussions about licensing rates and payments ‹ it¹ll just become a direct negotiation between two parties, and artists will be left out of the conversation completely. FMC was one of the artist-focused organizations that fought hard to ensure equal representation on the SoundExchange board, and artists and labels have benefited greatly from this power-sharing deal. We cannot support any effort that reduces our value in the stakeholder process.
Here at FMC, we want artists to get the money they¹re owed for the use of their music on any platform. The statutory rate for digital performance plus direct payment via SoundExchange is an important piece of the compensation puzzle for creators. Bypassing it might benefit the bottom lines of major corporations in the short run, but it¹s a dangerous thing for performing artists.
- If you are a musician, we urge you to tell your labels you¹d oppose any effort to re-direct your digital performance royalties through your label. In the interest of fairness and transparency, your label should continue to license through SoundExchange.
- If you are a label, we urge you to look closely at these deals, and remember that the statutory rate-setting process represents an opportunity for labels to work together to get the best rate possible.
The original and expanded post can be read here.
- 7digital launched a music app for its streaming service on Android tablets. (Music Week)
- Pete Townshend is wrong: iTunes is no digital vampire says The Guardian: "YouTube and Grooveshark might rip off musicians - but not iTunes.The Who guitarist... was off the mark." Read full text of Townsend's speech and Hypebot readers 'robust' comments here.
- NARM'S digitalmusic.org will present several sessions from its popular “Music Start Up Academy” at 2012 SXSW Music Conference, in conjunction with the SXSW Accelerator program, on Wednesday, March 14.
- Score (A Needed) 1 For EMI: They've extended their deals with Peter Gabriel. The new agreements builds on the decades-long relationships between Gabriel and both EMI Music and EMI Music Publishing.
- An extensive series from Bloomberg News: Selling Music in the Digital Age.
The Thought Leaders and The Artists: Both Sides From Jay Frank, Ian Rogers, Marian Call & Zoe Keating
I am not on the bleeding edge of futurism, I’m not really an early adapter, and I do not believe the artists I serve need to be. I am here to help artists understand and define why these conversations need to be observed, simplify and explain what it all means, and hopefully point some of us towards the light of success.
As I write this I am on a train speeding away fromOsloheaded toIceland. I had an incredible experience here I went dancing till 3 AM both nights with a new crew of Norwegian souls who were as warm and welcoming as any people I’ve ever had the pleasure of meeting and I was delighted to make their acquaintance. While dancing, with a bunch of strangers in a bar at 2:30 AM, I was reminded it’s still music that bonds us all. And while I was hanging out with them I discovered that 100% of them use Spotify. It’s how it is here inEurope. I suspect that is how it will be in theUSvery soon.
I had a complete blast. I love traveling to places where lives for creatives is just that much easier. This is a place where artists actually get support to be artists.
If you have questions: There is someone to call and ask. There is a gov’t body that supports the arts and helps musicians realize their visions. They have to work here just like anyone else but here there is more opportunity. Oh yeah, and there is health insurance and affordable (read: Free) school to pursue your dreams without going a quarter of a million dollars in debt.
We just don’t have that in theUnited States.
And I am so honored and humbled to be invited to share my observations and thoughts and strategies for success. It starts by listening to my friends on one side – the thought leaders. Then listening to my artist community friends on my other side (most of whom don’t care about these conversations BTW, they just want to make art) Sometimes I am exhausted from trying to drag them into these conversations and make them “do” all of the marketing and social media stuff I feel is critical for their success.
They can’t stop making art.
It doesn’t matter if that art is “good” or “repeatable” or a “hit”. These things will most likely contribute to their direct success, but it’s not why they create art.
My tenacious few: The people in my life who are F/T working musicians. They are DIFFERENT than most artists because they will be artists no matter what the industry insiders, futurists and naysayers say.
They will be artists if 99% of humanity tells them that their music isn’t trendy or hit worthy or that it outright sucks.
They will search and find their niches and they will succeed.
Will it be easy? Hell no.
It will be the hardest thing that they ever do – but they persevere.
Does everyone have to behave like this? No. Not at all.
The conversations are taking my breath away and reminding me that it won’t be getting easier anytime soon.
It will be getting harder for those of us who are not willing to ADAPT.
It really doesn’t matter what the major labels or Neilsen Soundscan or major radio does, that is a conversation that I am not involved in. That is conversation that a vast majority of the artists I know, meet, teach and represent don’t ever get invited to.
All they really need to know is: Do they need a fanpage AND a personal page? What is the best time to tweet? And how can they create a viable living from their art.
Most won’t be able to do that.
It, as Jay says, is probably because their music is just not commercially viable and scalable.
Do I believe that is true? No I don’t.
Do I believe that these artists will have to work harder to define their niches, identify their audiences, connect with them, feed them how they want to eat and stay ahead of the curve to exist? Yes I believe this.
Come read these conversations and take part: They are very important ones to have:
On Spotify: From a music Industry Vets perspective -
On Spotify: From an independent musicians perspective - http://www.hypebot.com/hypebot/2011/09/zoe-keating-on-spotify-fairness-to-indie-artists-musics-niche-economy.html
On Succeeding Today: How one artist uses a social media platform to win -
On Succeeding Tomorrow: How artists and industry professionals need think about brands and how to align with them -
Both sides: The thought leaders and the artists.
I hope you get something out of all four. Please read the comments, as they are almost as important as the articles themselves.
Thank You Jay, Zoe, Ian & Marian for sharing.
Ubisoft is responsible for such games as the "Just Dance" series and "Michael Jackson The Experience". Last month the company released "Rocksmith", signaling their intention to revive the music game genre that faded under the onslaught of dance games. The game's marketing ties into its combination of rock star fantasy and educational game and represents the final entry in Scott Steinberg's free ebook, "Music Games Rock".
Rocksmith Guitar Baby
Ubisoft's Rocksmith launched last month featuring a variety of rock songs, from Cream's "Sunshine of Your Love" to The Black Keys' "I Got Mine". Its most unique element is the ability to plug one's guitar into the videogame console using the Rocksmith Real Tone Cable. A special Guitar Bundle includes an Epiphone Les Paul Jr. which looks like a real winner for Christmas and is suggestive of the potential for future bundles if Rocksmith does well.
Rocksmith's marketing efforts feature two videos created by the Cutwater agency that have been quite popular on YouTube. The recently released Rocksmith Launch Trailer attempts to tap into the Guitar Hero-esque elements of Rocksmith with a somewhat cliched video. However, the Rocksmith Guitar Baby video shown above, released in early June, focuses on the educational aspects in a manner that ties together the uncanny baby theme with the desire of many parents to have their kids learn to play instruments.
Having presided over the shift from music games to dance games, Ubisoft's Rocksmith may well depend on Christmas sales and the dream of being a rockstar rather than pretending to be a rockstar.
Interestingly enough, Rocksmith is the final entry in Scott Steinberg's ebook Music Games Rock that profiles top rhythm games going back to Milton Bradley's 1978 release, "Simon". Available as a free PDF, I was pleasantly surprised to find that Steinberg included the "KISS" pinball game, my favorite music game of all time.
Hypebot contributor Clyde Smith maintains his freelance writing hub at Flux Research and blogs at All World Dance and This Business of Blogging. To suggest topics for Hypebot, contact: clyde(at)fluxresearch(dot)com.
Ever wonder how a major label builds a fanbase for a new artist? On Music Think Tank, Minh Chau finds the answer in David F. Carr’s article, “How Warner Music Turns Social Media Fans Into Customers. Read on to understand how labels build a fanbase and learn how to market your own music.
“When you hear about a “new” or “emerging” artist in the media, they’ve actually already reached critical mass, they just haven’t reached national recognition.”
On Music Think Tank, Marion Evon explains how to be a gracious musician which can help your career in the long run.
“It can make or break a musical career when absent, and when present, garner you the most support you have ever had.”
After missing Apple's self imposed deadline of a late October launch, its iTunes Match music service appears to be a bit closer to launch. Yesterday, Apple re-invited app developers to start playing with an updated beta version and added Apple TV support. Their beta invites read:
"iTunes 10.5.1 beta 2 is now available and includes a number of important stability and performance improvements. iTunes Match is also now available for testing on Apple TV.
iTunes Match stores your music library in iCloud and allows you to enjoy your collection from anywhere, any time, on your iPhone, iPad, iPod touch, computer and now your Apple TV."
iTunes Match will scan a users music collection comparing it to the 18 million songs on iTunes for $24.99 a year regardless of the size of the collection, It then allows access to the users music on all devices running iOS 5.
Written by Melissa Ridgley
Chicago rockers Empires have a big sound and an even bigger DIY attitude. Ever since boldly releasing their debut album, HOWL, for free on their website in 2008 when such a move was relatively uncommon, they’ve been winning over fans and critics alike at breakneck speed (i.e. tens of thousands of downloads and counting all through word of mouth). The four high school friends that make up Empires have relied on few others but themselves for the level of success they enjoy today, and seem to be appreciating every moment of it more because of this independence.
Check out the interview below to see what guitarist Tom Conrad had to say about the band’s summer contests with Rolling Stone and Airwalk, marketing shows with merchandise, and why they think the practice of giving before taking has worked wonders for them.
IndieAmbassador.com: So how has the tour been thus far with Colour Revolt?
Tom Conrad: It’s been good! We’re about a week in now. We had a day off yesterday and were in Toronto, and that was our first time in Canada. The guys in Colour Revolt are great — awesome band, awesome tunes. We’re very happy to be on tour with them.
IndieAmbassador.com: Great! So your first release, HOWL, was given away for free on your website, and racked up over 70,000 downloads. What marketing tactics did you use to promote this? Or was it more through word-of-mouth?
TC: It was completely word-of-mouth. So, this was back in 2008 when it was still kind of taboo for bands to release music for free. I feel like it was on the cusp of people being like, ‘should you be supporting this or should you not be?’ Our band has always been very self-sufficient by doing all of our recordings on our own, artwork and promotion – everything we’ve been doing has been in-house. So for us to give away a record for free was on our time and our money. It was ours. So we didn’t really feel like it was that big of a deal, and that we didn’t have that much to lose at all. We didn’t really think twice about it — we knew that’s what we wanted to do. I think at the time, looking back now, a lot has changed in the past two or three years. Now everyone is giving away their music for free. But like I said, at the time, it seemed like other bands were hesitant to do it.
IndieAmbassador.com: Empires has an extremely loyal fanbase. Can you point to anything in particular that has made the bond with your fans extra strong?
TC: I think it did start with HOWL. We hadn’t really played any shows yet and didn’t have a web store up yet. And I think the first introduction to fans was that we had this album for free. And we didn’t ask for emails, donations or anything. We just put it up there for downloads that only took one click. I think that was one of the big things that motivated us by putting the record out for free. It inspired us in a sense that the first introduction to the band was giving. Giving instead of asking fans to come to shows or buy merch. Instead it was like, here just take this. And let’s talk afterwards.
IndieAmbassador.com: Everyone has been asking you guys about the competitions you’ve been in recently, more specifically Rolling Stone’s Choose the Cover Contest and Airwalk’s Unsigned Heroes Contest. Do you think that giving the fans the power to decide who wins these big promotional opportunities is where the future of the industry is headed?
TC: I don’t think anyone knows where the industry is headed. Our attitude with Empires is that we are still very much in the driver’s seat. We just want more people to know about the band. So I guess the contests were good tools. Going into the contests, we never thought we were going to win. The editor in chief of Rolling Stone would say, ‘You’re so close!’ but we would just look at him like, ‘You’re funny, dude.’ We didn’t take it too seriously. We would just have fun with it and enjoy it. Each round we advanced we were like, ‘Huh, really? Alright.’
IndieAmbassador.com: On this tour you are giving away silkscreen prints of the concert poster to people who show you their receipt for buying a ticket in advance. What was your reasoning behind this?
TC: That brilliant idea actually came from Colour Revolt. It was another thing to encourage people, and something else to give back to fans. We keep trying to release music and tour as much as we can. Anything we can give while coming up with creative ideas, we’re all for it. We’re not really guys that are too shy and try to stay in the back.
IndieAmbassador.com: Are there any other unique merch items that you’ve given away, sold, or made?
TC: No, we’re pretty boring. I’m cool with like a black shirt and white ink. I have no idea. If you look at me now — I have no idea what to wear and not wear.
IndieAmbassador.com: Finally, tell me a little bit about what to expect from your upcoming release, Garage Hymns.
TC: So going back to the Rolling Stones contest, it was sweet and dandy and all but we still had our own agenda of trying to get stuff done for the year. We started in May and we’ve been working on this record now for about a year and a half. We spent about 18 months writing and demoing it out. We would go in and demo a song 6 or 7 times to make sure it had the right progression, bridge, tonality, or whatever it was. We just did our homework. So when it came down to the actual session for the record it was very quick. We didn’t think much about it. We knew what we wanted and it was a no-brainer. So it was kinda like doing your homework so come test-time we were like, ‘We got this.’ We are very confident in what we did and wish we could put it out tomorrow. We think we’ll release a song or two before the end of the year, but it will probably be a 2012 release.
IndieAmbassador.com: Cool, well I’m looking forward to it! Thanks so much for taking the time to talk to us.
TC: Oh yeah, thanks so much for coming out!