Yesterday, on-demand music streaming service Spotifydid something pretty big by explaining in detail how it calculates and pays out royalties to rightsholders. With so many music industry pundits and practitioners in a tizzy about the economics of streaming, this move can be generally seen as positive. But as always, the devil is in the details.
It is certainly significant that Spotify took this step—probably long overdue—and we hope that it serves to increase the standard of transparency across the digital music sector. When a market leader like Spotify makes this kind of move, it can be a spur to other players to follow suit. However, it doesn’t really change much in terms of artist leverage on streaming on-demand services, nor does it impact most musicians and songwriters’ bottom lines. We spend a great deal of time considering this stuff—in fact, our own Kristin Thomson recently wrote a post for Music Think Tank about ways to make streaming music more viable for artists. (And if you need a primer on how the money flows on a variety of music platforms, check out these handy charts.)
Here at FMC, we regularly engage in a kind of protracted dialog with government through public comments and other filings that can extend over years (actually, thirteen and counting!). While we don’t claim to have all the answers, we do believe that our history of direct engagement with musicians, composers, independent labels, publishers, PROs, unions and others is useful for policymakers to consider as they grapple with the many questions facing creators in the digital age.
On Wednesday, Nov. 14, 2013, FMCfiled comments with the United States Patent and Trademark Office (USPTO) regarding their recent “green paper”—itself a product of the Internet Policy Task Force comprised of USPTO, the Department of Commerce and the National Telecommunications and Information Administration. Way back in 2010, we filed comments in the original proceeding that resulted in this year’s report, Copyright Policy, Creativity, and Innovation in the Digital Economy [PDF].
Future of Music Coalition filed the following comments with the United States Patent and Trade Office (USPTO) in an inquiry related to a previously published “green paper” from the Internet Policy Taks Force (a joint effort also including the United States Copyright Office and the National Telecommunications and Information Administration).
Let’s say you’re practicing for karaoke night and you want to learn the lyrics to Bonnie Tyler’s “Total Eclipse of the Heart.” The internet provides you with many easy options to choose from. What might surprise you is that only some of these options are licensed and legal. In fact, the National Music Publishers Association (NMPA)—the trade group representing music publishers—asserts that over 50 percent of all lyric page views worldwide are on unlicensed pages.
That’s why the NMPA is targeting fifty prominent lyric sites that it contends have failed to obtain licenses for lyrics being reproduced and transmitted. NMPA has sent takedown requests to each site, with the promise of copyright infringement lawsuits if they fail to comply.
Let’s say you’re approached by David Copperfield (it’s OK, don’t run!), and he asks you to be an audience plant for his next big televised spectacle. You’ll be privy to some behind-the-scenes secrets, and outing his magic as merely illusion could be a disaster for his career—other magicians will cop his tricks, his performances will lose their coveted mystique, etc. That’s no good. So to make sure you keep your lips zipped, he presents to you (pulled out of a hat, probably) a non-disclosure agreement. This is a contract that says your discussions regarding this particular event are strictly confidential, and if you go blabbing he can sue you for breach of contract.
Non-disclosure agreements (NDAs) in this context seem pretty straightforward, but what about all the NDAs that pervade the music industry? Why all the smoke and mirrors obfuscating the terms of agreement between streaming services and major record labels, or deals between aggregators/distributors and YouTube?
The internet-fueled debate about the pros and cons of Spotify went another round last week, with contributions by David Byrne, Dave Allen, Jay Frank, Bob Lefsetz and Fast Company. I read them all, as I’ve done with the previous public debates about whether Spotify is a good or bad thing for musicians. As an indie record label owner and a long-time advocate for musicians, I care deeply about these debates and, more importantly, about ensuring musicians and songwriters are fairly compensated for their work.
Today, I posted a long-ish thought piece about this on Music Think Tank. Instead of focusing on the arguments about the fraction-of-a-penny rate per play, the article suggests some other changes to these music services that might make a substantive difference for musicians, songwriters and fans.
For consumers, iTunes Radio may feel a lot like another version of the popular “predictive” radio service Pandora. Plug in an artist or genre, and an algorithm spits out sonically related tracks. But while the experience for listeners may be similar up to a point, the revenue flow behind the scenes isn’t an exact match.
In order to break down how money gets from iTunes Radio to the artists, it’s first important to remember that every song has two copyrights: one for the underlying composition (think notes and lyrics on paper), and one for the sound recording (think music on CD, tape or hard drive).
It’s been a crazy couple of days here in DC. With all the hubhub over the government shutdown and general Congressional dysfunction, two of the most important pieces of news have been drowned out:
1. The Affordable Care Act is moving forward, and the health insurance exchanges opened today. This is an online marketplace where those who are currently uninsured, and those who pay for their own insurance now, can look at different plans, compare prices and get coverage. read more
In July and August 2013, Future of Music Coalition (FMC) and the Artists’ Health Insurance Resource Center (AHRIC) conducted an online survey of US-based artists about their access to health insurance.The survey found that, of the 3,402 artist respondents, 43 percent do not currently have health insurance. This is more than double the national estimate of 18 percent uninsured (ages 0-64), as calculated by the Kaiser Family Foundation.read more
WASHINGTON, DC—Today, Representative Mel Watt (D-NC) introduced the Free Market Royalty Act (FMRA), which would close the decades-old exemption enjoyed by terrestrial AM/FM radio broadcasters that allows them to not compensate performers and labels for the use of their works.
The bill aims to address the lack of a performance right by establishing a process through which parties can negotiate “fair market” rates while directly compensating artists in a manner similar to the existing public performance right for digital broadcasts. The following statement can be attributed to Casey Rae, Interim Executive Director of the Future of Music Coalition: read more