• Universal followed suit, adding provisions to give auditors previously denied access to manufacturers' records.
• Last year, Warner promised revisions to simplify royalty calculations, to attach interest to royalties unearthed in audits and to reimburse artists for audit costs when unpaid royalties exceed 10%.
The industry's voluntary improvements, from restructured royalty formulas to relaxed audit rules, eliminate any need for new laws, says RIAA's Marks.
"Marketplace solutions are always better than government mandates," says Marks, who calls the California bill a drastic and lopsided solution.
"Artists often hold back new albums as leverage to get a new contract, leaving the label with little recourse.
This fact highlights the unfairness of the fiduciary-duty bill, because that bill imposes an obligation on the labels without imposing a corresponding obligation on the artist."
Often overlooked in the royalty ruckus is that most artists are satisfied with their record contracts and that most disputes "are resolved with new contracts, not a parting of the ways," he says.
Though a label might seem to be carving a sizable chunk out of each hit, much of those profits offset huge losses elsewhere, Marks says.
"The average cost to produce and market an album has skyrocketed, enhancing the risk labels take in a business where nine out of every 10 albums fail to break even.
Labels rely on the one in 10 to pay for the nine that fail. Yet labels are always forced to renegotiate when an artist has a successful album."
McMillan envisions an overhaul of music's business model with pressure applied by artists, government and a public fed up with corporate malfeasance.
"The industry will have to reinvent and redesign itself," he says.
"Nobody wants unnecessary government involvement in private enterprise, but in a case where you don't have equal bargaining power on both sides, the government can be an accelerant.
We can build a new house brick by brick based on fairness and accountability."
Article comments
1 - Douglas Mays
Good post! Yes, it is quite a battle therefore some fuckery takes place to balance the books. Wherever a buck can be reappropriated it will, such as the case with Sam Moore.
And now, with music downloading for a cost (iTunes, etc.) that is another spot on the bueracratic learning curve.
True, one hit artist pays for the other 9 that don't make it. Quite a roll of the dice on the record company, but the small change it takes to treat someone like Sam Moore as a human being sure makes the current state of the music industry look like assholes.
It is a very complex issue. The whole system needs a spin dry.
peaceloveguidance
2 - Vern Halen
Ouch! I don't know why anyone would want to be in the music biz if this is how it's run. Now that I think about it, almost every rockstar bio I've read has a section or two or ten containing a financial tale of terror.
Still, I guess it takes a certain kind of person to keep plugging away at it until the brass ring comes within reach. Unfortunately, having that kind of personality and having talent don't necessarily corelate with each other.
3 - brown_boognish
Just don't sign to a major label if you want to avoid this shit. You can live an adquate life on a smaller label, and still get substantial distribution. No long contracts to screw you over.
4 - Vern Halen
Maybe part of the problem is that there are no long term contracts - t least ones that are designed to develop & nurture an artist with an investment over a period of years. Big Biz wants big bucks NOW, and if you don't make it the first time round right out of the starting gate, it's hard to get a second chance.
Think of almost any major artist from the 70's: Springsteen or Aerosmith, for example. Had they been dropped after their first or second albums, which had only moderate sales, they might mot have developed into the megastars they are today.
Simply put, it'd be really nice if music was the most important word in the phrase "music business."
5 - Douglas Mays
hhhmmm... the question of go indy or major. My suggestion is go major, if it fails you always have indy to fall back on.
Utilize a major. Just on advances alone and marketing (however slight it might be) that puts you far ahead of what an indy can do for you.
Then think of this, being a broke starving artist or complaining that you are owed another $50,000 on top of your $million.
A good, creative music attorney is helpful. Take a look at White Stripes for example.
Anyway, big risky business. It is a shame that the trickle-down effect to artists like Sam Moore occur. That is one of the holes that has to be plugged up. The industry must take care of its own till they die. Then in this business, after death also. Funny how death can sell records in this biz. Oh gosh, the next phase of music business scandle. Record companies wacking artists to really cash in...
anyway,
peaceloveguidance
6 - Douglas Mays
A classic phrase in the business: "not happy with your record contract? Be lucky you have one."
peaceloveguidance
7 - Vern Halen
hmmm.......makes you wonder about all those Cobain conspiracy theories out there.....
8 - Douglas Mays
I wonder... it wasn't Courtney. It might of been Tony 'the weasel' Belefukio.
Sorry, Courtney. Didn't mean to remind you of all these hack accusations being thrown at you.
peaceloveguidance
9 - Douglas Mays
Come to think of it, could be the case with Tupac...