That seems to be what an article from Web site zeropaid claims*. The site is up in arms about the three music licensing companies, BMI, ASCAP and SESAC, charging fees to nightclubs, bars and venues for live music. It states that instead of having to pay the fees, the venues are shutting down instead.
Individually the licenses are usually no more than $650 p/yr, but when combined with payments to the other two the amount grows untenable for many, especially if they’re also required to pay royalties for music played on a jukebox or radio.
So what has happened is that many are choosing to shutter live music altogether, by some accounts as many as 50% in the St Cloud, Minnesota area alone.
The main sticking point for the author of the article is that the fees clubs have to pay are for just in case an artist plays a copywritten song. But any club that has a jukebox is paying the three fees as well. And the scientific claim of 50% of the live venues closing in St. Cloud comes from a performer in a cover band, and doesn’t cite licensing fees as a reason for them closing. Another point claims that the royalty collection groups mainly collect from larger acts since they’re easier to track. That might be true, but works the same way that Roadrunner does. If signing a Nickelback can give them the finances to keep putting out Soulfly records, than everyone wins. And if a song is getting played, whether it’s live or on a jukebox, the artist deserves to be paid, especially in a time of declining CD saels.
It would be interesting to hear from a club owner as to how they feel about having to pay licensing fees. And also interesting to hear how much the penalty for copyright infringement is for ignoring the three groups.
* CBGB closed for a bunch of other reasons. SESAC, BMI and ASCAP didn’t play into those, but when you think ‘live music venue shut down,’ it’s the first that comes to mind. And Google image search.
From the “holy shit I managed to completely forget that ever happened” file: Tommy Lee’s late ’90s Crazy Town-esque shitshow Methods of Mayhem is back, and snagged a worldwide deal with Roadrunner Records’ Loud & Proud imprint.
Until recently, music recommendation/internet radio service Pandora accepted music from independent artists at no cost, in any form, even home-burned CD’s. Hypebot now reports submitting your own music has a few extra steps, and some costs.
In part because of a deal to display album cover art via Amazon.com’s servers, submissions must now be available as a physical CD for sale on Amazon, and include cover art and a UPC code to even be considered for airplay.
Compliance with the new rules will cost artists in several ways. According to its FAQ page, to get play on Pandora you now need:
* CD of your music
* A unique UPC code for that CD
* Your CD to be available through Amazon (must be a physical CD, not just MP3s for download)
* The legal rights to your music
* MP3 files for two of the songs from your CD
* Free Pandora account, based on a valid email address, which can be associated with your music
In addition to the costs of designing art and packaging a CD, Pandora suggests indie artists join the “Amazon Advantage Program” to comply with these rules. Membership costs $29.95 per year plus 55% of the list price of every CD sold. Established artists and labels already comply with Pandora’s new rules.
Hypebot gripes that these rules are unfair to new artists trying to gain exposure though Pandora, but really, should you be clogging up someone’s playlist with a song you recorded an hour ago and aren’t ready to sell?
Those of you that enjoy reading legal documents (or at least The Smoking Gun) might remember that Toronto punk band Fucked Up and indie rockers Xiu Xiu sued R.J. Reynolds and Camel cigarettes a few years back. The bands appeared as part of a nine-page foldout section in the 40th anniversary Rolling Stone magazine as part of “the indie rock universe.” Problem is, neither band was asked permission by Camel to use them in the ad.
And actually, that’s only one of the problems. Camel was sued by eight states as well for the ad, which looks cartoony. Not to legally geek out, but as part of a multi-state Master Settlement Agreement, tobacco companies are forbidden to use cartoons to market tobacco products (which is why you haven’t seen this guy around lately). Apparently, R.J. Reynolds didn’t learn their lesson, and decided to drag some bands down with them.
While the class action lawsuit filed by Fucked Up and Xiu Xiu (on behalf of the 186 bands used in the spread) against R.J. Reynolds has yet to be settled, The Daily Swarm reports that the first ruling in the states’ lawsuits has come down.
A Philadelphia judge has ruled that R.J. Reynolds Tobacco Co. violated the multi-state tobacco Master Settlement Agreement with an ad it ran in an issue of Rolling Stone in 2007 and must either run a “youth oriented anti-smoking advertisement” in the magazine in the next year or pay a sanction of more than $300,000.
Philadelphia Common Pleas Court Judge William J. Manfredi issued his order and opinion Tuesday in response to the commonwealth of Pennsylvania’s motion seeking sanctions in response to Reynolds’ Camel’s the Farm advertisement. According to Manfredi’s opinion, the ad was a cartoon. The MSA clearly forbids companies from using cartoons to promote tobacco products, Manfredi said.
While running a ‘smoking is bad, mmmkay?’ ad in Rolling Stone or paying 300 grand is just a drop in the bucket for big tobacco, remember there are seven other states with pending suits, as well as the bands’ lawsuit. And that’s not even taking into account the bands’ additional suit against Rolling Stone publisher Wenner Media. Under California law, where the band lawsuit was filed, punitive damages could amount to $750 per issue of Rolling Stone per band. Don’t get a calculator – we’ve done the math for you. It’s $195.3 billion. Yes. Billion.
Warner Music Group did not have the best of luck with investments in 2008, losing $33 million in ventures with streaming services imeem and lala. Business Insider largely attributes WMG’s $68 million net loss in the quarter ending March 31 to these deals.
The company also took a major digital loss, taking $33 million charge “related to the impairment of cost-method investments in lala and imeem.” According to its 10-Q [Ed. note: quarterly financial report], Warner Music wrote off $16 million in imeem, more than its 2008 imeem investment of $15 million, including a $4 million receivable write-off. The company also wrote off $11 million of its $20 million investment in lala.
As Media Memo points out, this means the streaming site owes Warner Music money that the label doesn’t expect to receive, noting that last month WMG didn’t renegotiate its streaming-rights deal with the company in which it has an equity stake.
We also heard “WMG” and “bad investment” mentioned in the same breath last year when Idolator reported WMG purchased Roadrunner Records without securing Nickelback for more than one album. Don’t get us wrong, in the long run, “bad investment” is debatable with Roadrunner – it’s easily the most bankable brand in metal. But making that big of an acquisition without guaranteeing the label’s biggest asset will be bringing in revenue for years to come…eesh.
Posted by Bram Teitelman on Mon, Nov 30, 2009 at 3:03 pm
Bad Deals