The RIAA is at it again-sueing college and 3rd graders

[Rufuss Sewell]

When will people realize that this argument is over???

It doesn't matter whether or not it's morally wrong to download/copy music. It's IMPOSSIBLE to stop it.

GET REAL FOLKS!!!!

Deal with reality. Everyone on the planet has the ability to copy information at will. Intellectual property is over. Start thinking about the new model and stop bitching about the fact that the old one is dead.

I'm not saying I know what the solution is, but I'd say just about EVERYBODY is "stealing" intellectual property and fining or putting a random selection of the entire population in jail is insane.

[CassidyGT]

I love reading this stuff. Its a facinating social phenomenon. Technology has created a fast forward function so we can see obsolescence occur right before our eyes in only a few years. I love watching the status quo desperately trying to hang onto a business model that just isn't feasible anymore. Suing children! - friggin awesome!!!!! You can see first hand just how desperate people become - clutching at straws.

Debating the morality of all this is pointless - it is happening and will continue to happen. Nothing can be done. Technology has changed the equation irrevocably. It is now up to the status quo to come up with a new business model that is feasible in today's world. The fact is, things are only worth what the market will bear. CD's are probably not worth $15 anymore. Maybe they are worth $10 - who knows. Equilibrium will be reached at some point.

Perhaps the days of multi-millionaire recording artists are gone. So is the buggy whip. Things change. Talk to John Henry and see what he has to say - a steel-drivin man for sure. Don't need him no more.

Anyway, it is great to watch the world change and watch 'the man' squirm. This is just the tip of the iceberg. Just wait and see what happens over the next 25 years or so.

None of this will stop the production and distribution of great music - one way or another.

Rufus got there two minutes before me!!! tip of hat!

Originally Posted by Rufuss Sewell

When will people realize that this argument is over???

It doesn't matter whether or not it's morally wrong to download/copy music. It's IMPOSSIBLE to stop it.

GET REAL FOLKS!!!!

Deal with reality. Everyone on the planet has the ability to copy information at will. Intellectual property is over. Start thinking about the new model and stop bitching about the fact that the old one is dead.

I'm not saying I know what the solution is, but I'd say just about EVERYBODY is "stealing" intellectual property and fining or putting a random selection of the entire population in jail is insane.

I think you're right. Entire, books are available for download in addition to movies/CDs.

The faster computers become it will only become worse.

I can forsee a day when college bookstores no longer make money when students download their text books.

We have a much bigger problem brewing than people are admitting to.

[minipoodle]

I usually stay out of these discussions but feel the need to chime in here. I apologize if anything I say is redundant. I work for a prominent independent label and also lead my own band.

As in any industry, the music business has its share of greedy and clueless individuals. However the majority of people in the industry simply want to be able to make a living doing something they care about- and they work incredible hours to do so. The average person has no idea how much labor and money is involved in producing and marketing a profesional product and artist. The particulars have already been covered so i won't rehash them here.

One of most depressing arguments I've seen here is that downloading only affects already successful solom performers/bands. Besides the fact that that argument is simply moronic in its own right, have these people ever wondered where the money comes from when a label actually decides to take a chance on an interesting group? Ever since the music industry began a tiny percentage of big-selling artists have provided the funds that have helped launched the careers of creative artists people know and love. There are plenty of problems in the industry today and downloading is just one fo them. Still some food for thought I think...

[KingDaddyO]

Originally Posted by minipoodle

I usually stay out of these discussions but feel the need to chime in here. I apologize if anything I say is redundant. I work for a prominent independent label and also lead my own band.

As in any industry, the music business has its share of greedy and clueless individuals. However the majority of people in the industry simply want to be able to make a living doing something they care about- and they work incredible hours to do so. The average person has no idea how much labor and money is involved in producing and marketing a profesional product and artist. The particulars have already been covered so i won't rehash them here.

One of most depressing arguments I've seen here is that downloading only affects already successful solom performers/bands. Besides the fact that that argument is simply moronic in its own right, have these people ever wondered where the money comes from when a label actually decides to take a chance on an interesting group? Ever since the music industry began a tiny percentage of big-selling artists have provided the funds that have helped launched the careers of creative artists people know and love. There are plenty of problems in the industry today and downloading is just one fo them. Still some food for thought I think...

Great post ... points all taken.

It might be very interesting, if the RIAA were to take a page out of your playbook, and work to educate those who aren't in compliance ... instead of demanding obediance at the end of a legal bludgeon.

[Rufuss Sewell]

Is it really a problem? If everyone in the world had a nanofactory that printed chicken legs there would be a few chicken farmers without a job, but everyone in the world would be able to eat. I think that's a pretty good trade off.

I'm a musician and I want to make money, but I still think the world is better off having free access to Imagine by John Lennon. He mentions "imagine no possession" in that song. It's an important song.

I'm a capitalist at heart, and I know intellectual property is the inspiration for new life saving drugs and all of the great things that enhance our lives. But it's hard to ignore the fact that drug companies make more money from keeping people sick rather than curing diseases.

Eventually everything (not just music and ideas) will be free and printable like in Star Trek and that time is coming very soon, definitely within our lifetime. My hope is that scientists will be inspired to create life saving drugs in order to save their family from dying a miserable death. We'll make music because that's what we love to do! And everything will be groovy because we ain't fighting over money and oil and possessions anymore!

I ain't no hippie, but it looks like it just might be headed that way. If we're still trying to sell shit we'll be in big trouble because we'll also be able to print nuclear bombs.

[CassidyGT]

Originally Posted by Joe Porto

Lets think this through for a second. There is already federal legislation being written that will severely limit our access to the net. Look at it like Radio before the FCC became involved. We still have control, but if it continues to be abused (in the eyes of big corporations), believe me, the lobbyists will start pushing the pork, and we'll all be talking about the good ol' days when the net was still public.

We've always been able to copy music. I'd rather listen to a second generation cassette of a vinyl record then an mp3 any day, so quality isn't the issue. It's the propagation of the material through the net that is the problem. That can be taken away in a single congressional session.

Respectfully must disagree. The cat is out of the bag and I don't think it can be put bck in. I hear what you are saying but I believe the world has chnged beyond 'the man's' ability to control. Think about the printing press - it changed the world - predicating the American Revolution, the French Revolution and the revolutions of 1820, 1830 and 1848. The flow of information that the printing press enabled could not be stopped - and they tried to stop it.

I already hear you saying that this is different, but fundamentally it is not. People will find a way. As long as their are phone lines, data lines, cell phones, pagers, etc.etc. - people will find a way. It will be interesting to watch 'the man' try to regain control over the flow of information. Bloggers are already changing the way news is reported. This is very dangerous to 'the man'. Juicy stuff.

[Rufuss Sewell]

Originally Posted by Joe Porto

Lets think this through for a second. There is already federal legislation being written that will severely limit our access to the net. Look at it like Radio before the FCC became involved. We still have control, but if it continues to be abused (in the eyes of big corporations), believe me, the lobbyists will start pushing the pork, and we'll all be talking about the good ol' days when the net was still public.

We've always been able to copy music. I'd rather listen to a second generation cassette of a vinyl record then an mp3 any day, so quality isn't the issue. It's the propagation of the material through the net that is the problem. That can be taken away in a single congressional session.

Yeah right. A huge portion of the population is addicted to the internet and almost all businesses make some or all of their money from the internet. If congress tried to kill the internet they'd be fired fast and replaced and they know it.

[Gregg Sartiano]

Originally Posted by CassidyGT

None of this will stop the production and distribution of great music - one way or another.

Well, "demo deals" died right around the time of the Napster boom & the first big round of firings at Warner...and getting anything beyond a spartan recording budget is next to impossible for most signed artists...I don't think a lot of artists are really thinking along the lines of "how about we hire an arranger and do some orchestral dates on this stuff?"...and you can't take chances on the label's dime if even the stuff that SHOULD sell isn't selling (and everybody at the label who would stick their necks out for you in a good year is scared of losing their jobs)...no: steady, good business has nothing to do with the production and popularization of great music and innovation and things like that...

[Jazzpunk]

Originally Posted by Rufuss Sewell

Yeah right. A huge portion of the population is addicted to the internet and almost all businesses make some or all of their money from the internet. If congress tried to kill the internet they'd be fired fast and replaced and they know it.

I could give a rat's ass if they killed P2P services as I don't use them. Do you use them Rufus?

[Mike Caffrey]

Originally Posted by gsilbers

i was parafrasing a Frank Filipetti coment in an article in electronic musician. as you said, he also mentioned that the comparison is based after recouping by public perfomance (theatres).
its the bang for the buck ideology. you are getting movies that cost a lot of more money to make for the price a little more than a CD which cost far less to produce.



your last coment sounds interesting. kinda like Mcdonands is is the real estate business rather than in the burger business but they dont know it.
but can u explain a little more though..

Kind of like movie theaters are in the popcorn and candy business...

It's very simple. Record labels have always functioned as venture capital companies.

Look at Amazon. A VC company gave Jeff Bezos a big chunk of money to build the company, which since it is more of a presence in "cyberspace" than the real world, it's reasonable to call it more of a brand than a company. The VC probably took a 75% share or so. Maybe more. (Chipotle has one owner, but he's done a deal with McDonalds and the profits are shared 10/90 owner to McDonalds - Sound familiar?)

Originally his business model was selling books, but that's not all that he sells. The VC created that brand with the cash investment (not to take away from Bezo's idea and hard work) so they take their cut on everything.

What would you call a VC who made the same investment, but instead of 75% or everything asked for 90% of Amazon's CD sales? You might call them an idiot - I'd call them a record label.

The investment created the brand and CD sales is probably one of the smallest revenue streams, so that's a bad deal structure from the VC side.

Every year Rolling Stone magazine publishes the top 20 band/rockstar incomes and breaks down the sources. I don't remember which year it was, but the Rolling Stones were #2 with $44 million total, $900,000 from record sales.

So, the label that invested in the Stones and made them a household name, assuming their still getting a cut took 90% of $900k, and the Stones got $44.1 million. Can you see what the problem is?


Let's plug those numbers in on a smaller scale and call it a new band, that does ok for the first time out and will divide those numbers by 100.

Let's say they get a $100k deal to cover lawyer/manager/producer/record/mix/master. They get an additional $50k for video and marketing.

Let's say that that investment generates an income of $440,000 (1/100th of the Stones) in the year that they album was released. If the same fraction of revenue is CD sales, that means the label take 90% of $90k giving them $81,000 and the band takes $359,000 or about $90k per member of a 4 piece band (In a fantasy world without taxes and managers fees).

Now, suppose it's time for the second album. We're at the beginning of year two. The deal was "two firm" so they get a second $150k but that's accounted for by the same expenses as the first.

They spend 4 months writing, 2 months rehearsing and 6 months recording and they write the best songs they've ever written. Now, they are screwed beyond comprehension because the record label didn't take enough money out of the deal.

Here's the math.

The label spent $150k and got back $81k. They lost $69k.

The band didn't work for the second year of the deal, so their $90k each becomes the equivalent of $45k/year for two years (unless they took on day jobs while writing).

The label spend an additional $150k putting them $219k in the hole (a number that the soon to be fired A&R guy recognizes as his annual salary).

The second album is done, but the label realizes if they don't release the album, they can save $50k, so they shelve it and drop the band.

The band looses their best songs to the 5 year no re-recording restriction, so they can spend another year or half year writing more songs (if they're not too depressed to write) if they can afford to spend the time writing rather that spreading their $90k to three years at $30k, which after buying new instruments and home recording gear (which was digital and has lost its value a year later). Then, if they don't break up and manager to write songs, what are the chances of getting a new deal with the stigma of being a dropped, failed band? They've got a track record of loosing money.


Now, if we rewrite the deal - instead of taking 90% of album sales, the label takes 35% of everything it's a whole different story.

At the end of year one, the label no gets $154k and the band gets $286k.

Each band member gets $71k, or $35.5k stretched over two years.

When they do the second album, they're showing a profit from the year before. It's tiny, but it's not a loss. Now,if you're on the label side and you have to speculate whether releasing the second album will turn a profit, what would you predict?

Well, the band has written their best songs ever. That's a good sign. Suppose the same thing happens again like last year? In this model that points the speculation towards a profit and combine that with the better songs, and it will probably be more profit. Plus time. Now old fans come to shows and bring friends who become new fans and it spread, maybe just a little.

Now at the end of year two, maybe the gross is double, which means the profit grows from $4k on the first album to $158k on the second album. That's a 3950% increase in profit! You know the option for the third album is going to get picked up.

What would you predict the band will deliver for their third album?

How about: Pablo Honey -> The Bends -> Ok Computer....


Now all of a sudden we've got artist development and a band that would have been dropped sticking around for three albums. Should a label get a percentage of t-shirt sales? The band wouldn't be selling them if it wasn't for the label's investment. Plus, it's in the band's best interest to be profitable the first time out. Home run hitters often have low averages. Barring exceptions, there's more money in longevity, so this type of deal is in a band's best interest.

Plus, if change the deals to this type of structure, all of a sudden Napster (the original) is not a threat. In the worst case scenario, the $44 million becomes $43.1. The label's $810,000 actually increases in this worst case to 35% of $43.1 million to $15.1 million. And, wouldn't legal file sharing be the biggest boon to music promotion since radio? Think how much cheaper and easier it would be to reach more new fans, so realistically, I think it's a reasonable assumption that the gross would have been higher under the 35% deal structure.

Can you see how 90% of a record's sales is both a bad deal for the label and it's really not enough?

Album sales have always been the smallest of the many revenue streams that a band generates. And if you want to talk about a teen pop persona, it's even more extreme. The Olsen Twins, who don't even work are still generating at least half a BILLION dollars annually, and it's not from "investments".

Traditional deals have always been bad for labels, but their so busy looking at the bottom line that they don't even see why it's not bigger. Now that there's a small shift in revenue sources for bands/artists labels are in a panic even though the artist in many cases are making more than ever. The unfortunate problem is that there is some seed money necessary and it still is and always will be more than an artist or a band in their early 20's will have to invest in themselves. So they need labels, or some other source of VC.

If labels don't figure out how to make deals where they recoup from other sources, they will be gone. And, with the example from last week of an ad agency creating an artist/song that got airplay, but was actually a 3:30 advertisement (5 radio ads for the cost of none!), I think ad agencies are the likely source of VC to replace labels.

[CassidyGT]

Originally Posted by Gregg Sartiano

Well, "demo deals" died right around the time of the Napster boom & the first big round of firings at Warner...and getting anything beyond a spartan recording budget is next to impossible for most signed artists...I don't think a lot of artists are really thinking along the lines of "how about we hire an arranger and do some orchestral dates on this stuff?"...and you can't take chances on the label's dime if even the stuff that SHOULD sell isn't selling (and everybody at the label who would stick their necks out for you in a good year is scared of losing their jobs)...no: steady, good business has nothing to do with the production and popularization of great music and innovation and things like that...

I think you are being sarcastic .... and I hear you - but frankly most of the music I listen to is not from major labels. I don't think major labels produce anything that is really innovative. People in their homes now have the ability to produce great sounding stuff in their PCs. Wonderful.

[lordmiguel]

Originally Posted by KingDaddyO

For a good read concerning these tactics:
The RIAA vs. John Doe, a layperson's guide to filesharing lawsuits - The Digital Music Weblog

The article is a pretty good summary, however, I wholeheartedly disagree with the unsupported statement in the article, which is conveniently placed near the beginning of the article, where after 80% of people don't read...and why soundbytes and headline fodder sway tens if not at least a hundred million non-thinkers (and readers) in this fabulously uninformed country of ours:

"It's quite possible (and maybe even more likely than not) that these average people didn't violate anyone's copyright."

It is probabaly much more likely they did than not. Lets be real. The average person under 30 has at least several hundred songs on their computer or ipod that were jacked. Perhaps excluding the radical evangelical kids.

[Mike Caffrey]

Originally Posted by GearGeek

Music is a LUXURY people, not a necessity.

That's very debatable and infact, I think most likely untrue.

I'm not saying that 3,000 songs on an iPod, but the role of music within human culture.

[Mike Caffrey]

Originally Posted by gsilbers

how about more kids going to your concerts and buying the merchandise?

Too much work. How about more kids buying my Pantone color - like Jay-Z.

[Jazzpunk]

So for all the guys embracing illegal downloading as a positive thing for the music biz, what is this new business model you keep alluding to? Most popular songs are now available for legal purchase online for 99 cents or less and yet people continue to steal it...um, I mean 'share' it, so obviously that is more of a band-aid then a long term solution.

Please enlighten me as to how you guys plan on convincing an entire generation that is being raised on a sense of entitlement, that they should suddenly feel morally compelled to purchase your music when they can get it for free with zero repercussions. How will that work exactly?

[Mike Caffrey]

Originally Posted by Resonant Alien

Illegally downloading music has nothing to do with Copyright. Copyright means that someone else cannot take your song, re-record it or perform it themselves and make money from it. The same way that I could not take Lord of the Rings, put my name on the cover and sell it as if it were a book I had written.

That's incorrect.

Holding a Copyright means you own the right to control copying of that piece of intellectual property.

People can re-record a cover of your song.

People can not make a duplication (copy) of your recording and sell it.

If you buy a copy of the Lord Of The Rings, you can re-sell it. Even Amazon sells used books.

The crime of plagarisim is not a copyright violation it's fraud.

Sampling in a hip hop track, if the sample is uncredited the the artist is claiming they wrote it, could encompass both.

[Mike Caffrey]

Originally Posted by no ssl yet

I don't think you understand sound recordings and copyrights. It's theft, but it's in direct violation of the copyright. You can't sue a system for making downloads available.

They specify their services are not to be used for illegal purposes. This frees them. If I take my glock 9mm and go on a killing spree, I am responsible. Glock is not responsible.

But the guy who drives you in the getaway car is an accomplice for helping you commit the crime.

If someone sets up a digital distribution system with the intent of enabling copyright violations, they're an accomplice.

Kinko's in an interesting example. They're certianly providing the tools for copyright violations, and there are certain items that they're not allowed to copy for you.

I think it's pretty clear that their business is intended to serve people who've created something, say their own business flyer and they want to copy it. As the sole author, they're the copyright holder and therefore Kinko's is not primarily in business to help people violate copyrights.

Something like the original Napster? Did they really think that 90% or even 51% of their traffic would be unsigned bands?

[Mike Caffrey]

Originally Posted by lordmiguel

Man i think it would be great if this shift in the business could take place. Easier said than done but I do think it could be a parallel step change type of thing.
Im not so sure banner ads will be what gets you there though, at least for the next 5-10 years.

If it was a stream that was copyright protected but freely downloaded by everyone with advertisements in them- like youtube will probabaly be soon- then it might seem doable. Or even a protected download with a permanent ad in front (that can't be fast forwarded or cut out by software somehow)

You need to get paid on a per-listen or per-stream basis, and maybe secondarily the ability to change those ads. Ads before album songs, why not? If you don't want to sell out, go the traditional user purchase route.

I was just a little discouraged how consumers did not embrace free internet like netzero etc in exchange for ads. But kids, start with the kids they don't mind spyware, ads, anything as long as its free. Heck put a billboard in their room they couldnt give a crap as long as they get free candy.

Forget interet advertising - think bigger and more radical. The band is the medium. Think NASCAR and the drivers.

Saatchi and Saatchi signs a band. You think the band is called "Blink 182". Saatchi's interan name is "Abercrombie and Fitch Band #3".

[Jazzpunk]

Originally Posted by CassidyGT

I think you are being sarcastic .... and I hear you - but frankly most of the music I listen to is not from major labels. I don't think major labels produce anything that is really innovative. People in their homes now have the ability to produce great sounding stuff in their PCs. Wonderful.

For someone championing technology as the great equalizer I would think you would be against people illegally downloading music. Aren't the very guys you are fans of the one's who need the music sales the most?!

Every positive aspect about marketing your music on the internet can be taken advantage of without illegal downloading being part of the equation.

How many full CD's that get downloaded do you think people than go out and pay for? I'm guessin the answer is right around 'zero'.

[GearBit]

Anyone else notice that these threads separate the pros from the wannabes?

If you have been there and you have done it then you know.

[Mike Caffrey]

Originally Posted by Rufuss Sewell

When will people realize that this argument is over???

It doesn't matter whether or not it's morally wrong to download/copy music. It's IMPOSSIBLE to stop it.

GET REAL FOLKS!!!!

Deal with reality. Everyone on the planet has the ability to copy information at will. Intellectual property is over. Start thinking about the new model and stop bitching about the fact that the old one is dead.

I'm not saying I know what the solution is, but I'd say just about EVERYBODY is "stealing" intellectual property and fining or putting a random selection of the entire population in jail is insane.

Of course it's possible to stop it. All you have to to is make the repercussions so extreme that no one is willing to take the risk.


Or, make it legal.

Originally Posted by Mike Caffrey

That's incorrect.

Holding a Copyright means you own the right to control copying of that piece of intellectual property.

People can re-record a cover of your song.

People can not make a duplication (copy) of your recording and sell it.

If you buy a copy of the Lord Of The Rings, you can re-sell it. Even Amazon sells used books.

The crime of plagarisim is not a copyright violation it's fraud.

Sampling in a hip hop track, if the sample is uncredited the the artist is claiming they wrote it, could encompass both.

Sampling constitutes a willful copyright infringement. It's equivalent to bootlegging.

[Protools Guy]

Originally Posted by GearBit

Anyone else notice that these threads separate the pros from the wannabes?

If you have been there and you have done it then you know.

That's a very interesting perspective GearBit!!

[GearBit]

Originally Posted by Protools Guy

That's a very interesting perspective GearBit!!

Thanks.
You know it only makes sense really.
Who EVER talks nice about the hot babe that wouldn't go out with them?
If you talk to the guy that IS dating her though it's a very different attitude.

[Resonant Alien]

Originally Posted by Mike Caffrey

That's incorrect.

Holding a Copyright means you own the right to control copying of that piece of intellectual property.

People can re-record a cover of your song.

People can not make a duplication (copy) of your recording and sell it.

Not exactly. It depends on which Copyright you are talking about - that of the song (circle C) or that of the recording (circle P). If I own the copyright to my song, no one is allowed to re-record a cover of it without first getting my permission, else they are in violation of the Copyright. They are not even allowed to write a song that has a extremely close resemblance to my song. If I only own the Copyright on the recording, and let's say the song itself is in the public domain, then anyone can record a cover, but they cannot make a copy of my recording for distribution.

Copyright law does allow you to make a copy of a recording you own as long as you are not going to try and sell that copy or otherwise distribute it.

So, I guess I am wrong in that illegal filesharing is a violation of Copyright because someone who does not own the material is copying those songs and putting them up for distribution. However, it is also stealing.

If you buy a copy of the Lord Of The Rings, you can re-sell it. Even Amazon sells used books.

The crime of plagarisim is not a copyright violation it's fraud.

I could re-sell my copy of LOTR, but I cannot slap a new title page on it claiming myself as the author, which was my example. And actually, plagiarism is both Copyright infringement AND fraud.

kids will continue to download music iligally. its wrong of course as u say but not sue them. sue the poeple above in the computers and tech companies and the same companies that provude the free media so they comply to make limewire iligal in every country or not be able to be run on mac or wondows OS or whatever but something instead.

That is about like saying that people are going to speed even though it is illegal, so instead of writing speeding tickets when you catch someone going too fast, you should fine Toyota for making a car that can exceed the speed limit. These "kids" are largely 20 year old college students. They know it is wrong, they know it is illegal, and yet they continue to do it. They did something they know is illegal, they got caught. Life lesson #349. Deal with it, learn, don't do it again.

We can debate all day whether it should or should not be illegal, but the fact is that right now, it IS illegal, and if you get caught, YOU are the one to blame - not Dell, not Apple, not anyone but YOU.

I could argue that the speed limit on my street should be 45mph instead of 35, but if I go out tomorrow and drive 45 on that road, and get caught, that's my fault.

[lordmiguel]

Originally Posted by Mike Caffrey

So, the label that invested in the Stones and made them a household name, assuming their still getting a cut took 90% of $900k, and the Stones got $44.1 million. Can you see what the problem is?

Very valid point mike. Labels are like VC's, except labels do more and take less.

Label do keep the masters and half of the publishing though. The value of these net-net is not insignificant. The pusbishing and catalog value/streams related masters alone supported the debt financing in the Warner music deal.

Either scenario recorded music is still a loss leader but your point is interesting. However, since the big acts like the stones get to customize their own deals and not swallow the standard boilerplate, the labels would never see that money regardless of how new artist deals are restructured.

Its the recorded side that's hurting, but still fuels the highly valued publishing side and catalog values. Right now, the recorded music side is a loss leader for the publishing business. Under your scenario so is yours.

Originally Posted by Mike Caffrey

Now, suppose it's time for the second album. We're at the beginning of year two. The deal was "two firm" so they get a second $150k but that's accounted for by the same expenses as the first.

They spend 4 months writing, 2 months rehearsing and 6 months recording and they write the best songs they've ever written. Now, they are screwed beyond comprehension because the record label didn't take enough money out of the deal.

Isn't this assumption the exception rather than the rule? Don't most artists hit that sophmore slump becasue they spent 8 years on their first album and 4 months on their second? Are the songs usually better or worse?

Originally Posted by Mike Caffrey

Now, if we rewrite the deal - instead of taking 90% of album sales, the label takes 35% of everything it's a whole different story.

mike, i don't know if you can take a fraction of the stones numbers and assume they hold true for smaller and new artists. i think you may have significnatly overestimated tour revenue / profit. small band isnt going to charge those ticket prices, and don't have those massive economies of scale over the touring costs when you're talking those numbers of fans. are new artists really going to make any significant money touring?

"net-net" regardless of how you break up the pie most artists lose money on the "whole enterprise" don't they?

Originally Posted by Mike Caffrey

And if you want to talk about a teen pop persona, it's even more extreme. The Olsen Twins, who don't even work are still generating at least half a BILLION dollars annually, and it's not from "investments".

OK Mike they are TV stars, that is where their fortune / brand was made. But you point is noted, if there are any economies of scale a single pop artist has over a band the record company should share in that.

Originally Posted by Mike Caffrey

If labels don't figure out how to make deals where they recoup from other sources, they will be gone. And, with the example from last week of an ad agency creating an artist/song that got airplay, but was actually a 3:30 advertisement (5 radio ads for the cost of none!), I think ad agencies are the likely source of VC to replace labels.

I can't say i agree that recouping is the labels problems - but your conclusion is very valid. This is where labels aren't like VC's - their artists can't promote and advertise and brand themselves. Advertising companies do this for a living. Because the cost of music production has gone way down, this is actually who should own the labels, from a cost of capital and core competency perspective.

Now if they want the existing ones is another story. Ad agencies are a high cash flow high growth industry and its tough to buy low growth assets like a music company. They might be better rolling their own and stealing the marketshare.

[lordmiguel]

Originally Posted by Mike Caffrey

Forget interet advertising - think bigger and more radical. The band is the medium. Think NASCAR and the drivers.

Saatchi and Saatchi signs a band. You think the band is called "Blink 182". Saatchi's interan name is "Abercrombie and Fitch Band #3".

hah, point taken though they wouldnt restrict themselves to one company.

the internal name would be more like "teen and frat cookie cutter wanna be whose parents pay for anything market band #3"

joking of course, i write pop!

[GearGeek]

Originally Posted by GearGeek
Music is a LUXURY people, not a necessity.

Originally Posted by Mike Caffrey

That's very debatable and infact, I think most likely untrue.

I'm not saying that 3,000 songs on an iPod, but the role of music within human culture.

Oh yes you are right. Just look at the epidemic in Africa. Millions died because lack of music.....

[Beermaster]

Well one good idea is sites like this:

Free Music Downloads - Music Promotion - We7

Check it out - they are pretty new but I think this is a step in the right direction.

Beer