The Companies That Make Up The Music Biz

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Excerpted from Moses Avalon’s book Confessions of a Record Producer, published by Backbeat Books.

So one afternoon you sat down and wrote a simple four-chord song and made a rough recording on your home hard-disk multi-track. You sent it to a friend who liked it, and the next thing you know, a top artist heard it and fell in love. They want it for their next album. A few months later, the song is on the radio and it’s a hit. You’ve won the jackpot.

Suddenly, as if from nowhere, your mailbox is being stuffed with large, thick envelopes from various companies. Who are they? What do they want? There seem to be hundreds of them and they all have thick forms and legal documents for you to fill out. You’re hearing from record companies, performance rights organizations, publishing companies, promotion companies … It is staggering how many companies are associated with a marketable song.

All right, so the above example is a bit oversimplified, although I have seen songwriters with successes almost that dramatic. The point I’m making is that most artists and songwriters are at first unaware of the amount of paperwork and legal documentation that goes into the simple four-chord song they wrote and produced in their living room. Here is a basic list of some of the main companies and what they do. They are the entities we speak of when we speak of “the music industry.”

Record Companies
Record companies are in the business of making bets. Every band they sign requires an outlay of cash. If it’s a major label or a major-owned indie, it could be anywhere from $200,000 to $2,000,000 per act. If it’s an independent, the tab is usually no more than $50,000. In essence, record companies are really banks that specialize in lending money to musicians. The idea that a record company gives an artist money is the most common misconception among new artists. In reality, record companies loan the artist money.

When you read about an artist getting a one-million-dollar recording contract, it means that the record company offered to loan that artist up to a million dollars over the course of the contract. The artist is expected to pay it back out of the royalties that their record earns.

Aside from loaning money, record companies offer promotional and distribution services to a recording artist. These services can range from merely supporting distribution for an already finished record, usually for about 25% of the artist’s profit, all the way to the other end of the spectrum of financing the recording of the record and then promoting and supporting its distribution. For this, the take is generally up around 90% of the proceeds from record sales.

Production Companies
These operate in one similar way as record companies – they invest in talent – and one vital way that they do not, in that they do not have a specific distribution contract with a distributor to get their recordings into a retail environment. This is no small exception – if you can’t get the records in front of customers, you usually can’t sell very many of them.

Production companies, which I sometimes call “vanity labels” or “three-deep labels,” are usually owned by producers or recording studios. They sign artists and produce demos and shop them in hopes of getting the artist a record deal.

Many production companies dream of being record companies and often seek an affiliation with a major label or distributor to handle their product. But don’t be fooled. Unless the production company has secured a distribution contract with a legitimate distributor or has found a way to independently release their recordings, they are no more capable of selling records en masse than you or I.

Publishing Companies
The role of the publishing company is easy to comprehend, even if publishing deals themselves are not. Simply put, publishing companies control and safeguard the copyright by dealing with the complex renewal regulations, and they collect the money that is due to the songwriters whose copyrights they acquire. They also litigate on behalf of their authors in case of infringement, and they shop your songs to various other companies to use in movies, commercials, TV shows, and so on.

In exchange for these services writers agree to hand over the copyright of their songs and receive a percentage of whatever the songs earn – usually about 50%.

If you’ve written a song that is going to be released on a major record label, you are going to make money. Because the Copyright Act of 1976 requires record companies to pay for the use of a song on a record. The rate labels have agreed to pay is called the “compulsory rate” (sometimes called the “statutory rate”). It is paid to each author who writes a song that’s on any record they distribute. As of January 2006 the rate is 9.1¢ per song for each record distributed.

So, to continue our mock example, you wrote a song that will now be on a big record. The record company agrees to pay the owner of the copyright a compulsory licensing fee of about 9¢ for each song on a record, and for each record sold. A million-seller has huge potential.

The publishing company sees an opportunity to collect some easy coin, so they will try to make a deal to collect writers’ royalties, since writers seldom want to go to the trouble of pounding the phones and hiring accountants to do this nasty work themselves. The publishing company will also negotiate and collect the synchronization license fees for a song. A synchronization license is the fee that a movie or television company pays for the right to use the song as part of the soundtrack in a film or TV show. These fees can be quite high.

For the use of Sonny and Cher’s “I Got You Babe” in the movie Groundhog Day, the film’s producers paid the song’s publishers $80,000. Not bad. In recent years publishing companies have found new sources of revenue in “clearing samples.” Samples are the small sound bits used mostly in rap and R&B to make up pieces of the groove of a song. The publishing company owns the rights to the songs embodied in the samples, so they can negotiate a fee for use of the sample in a new song. Then there are ringtones, a revenue stream worth about $1 billion a year to publishers.

As an artist or writer, you may be asking yourself, “Why do I need this?” Well, you may not. Starting in the ’60s, many artists who wrote their own material realized that they were giving up 50% of their money to a service that they didn’t require, because they were the artist recording the material. Why hire a company to sell the material to others? They began to make publishing arrangements directly with the record companies. In order to compete with this new trend, publishing companies started handing out big advances to new artists, as high as $1,000,000 for a new act; superstar writers can get five times that amount. In fact, this still is a common practice. But still, why would an artist accept any amount of money to give away 50% of their music when they don’t have to?

Over the past few years, in an attempt to compete directly with publishing companies, several entities have sprung up that will gladly collect a songwriter’s (or publisher’s) money and enforce his rights for a mere 10%. They call themselves copyright administration companies. They don’t generally shop songs (but most publishing companies don’t do that either these days) nor do they give you large advances. But if you haven’t tied up your administration rights with a standard publishing deal when luck strikes and one of your songs is placed in a major project, signing with one of these has huge advantages. You retain most of your rights, and these companies perform most of the same services that you would expect from a publisher. Some of these companies also administrate the copyrights of sound recordings, something traditional publishing companies do not do as yet.

The one type of revenue that publishing companies and copyright administration companies let others collect for them are performance royalties – that is, the royalty that the writer/publisher of a song gets each time that song is performed publicly on media like radio or network TV.

In the music business, “perform” has a unique definition that goes beyond the normal use. When you see a musician play a song live on TV, you’re obviously watching a performance. But did you know that when a DJ spins a record in a club, what you’re hearing is a “performance” as well, even though it’s originating from a machine? This also goes for cover bands playing at weddings, as well as jukeboxes in bars, DVDs, turntables in nightclubs, and any other type of music that is experienced in a “for profit” public place.

So, yes, the common interpretation of law says that each time a radio station plays a song for its hundreds of thousands of listeners or a DJ spins a mix in your favorite dance club, the writer should get paid a few pennies for the “performance.” If the song is a hit, this can add up to quite a few pennies. But how can you ever know how many times each station or club plays a song, or how many wedding bands are turning your cool hit into “the bride cuts the cake”?

Performing Rights Organizations
Enter the PROs, that is, the performing rights organizations: ASCAP, BMI, and SESAC. (Also called “Societies.”) In the United States, they represent the writers, the little guy out there trying to make a buck in the super-duper Big Brother environment of the broadcast industry.

These three companies monitor clubs, venues, theaters, and the airwaves and keep track of who plays what and how many times. They collect performance fees (which vary according to the approximate listenership of each station or size of each venue) and distribute this money to the writers who are registered with them. Because the costs of negotiating millions of transactions would be prohibitive, a system has evolved using these societies in similar ways that unions represent laborers with collective bargaining. Each society negotiates a “blanket license” (kind of like a set annual payment) that permits broadcasters and venues to play music by its members.

Since you cannot belong to more than one PRO at a time, and since hit songs earn a ton of cash, these organizations compete fiercely for membership. The rivalry between ASCAP and BMI has filled the pages of several other books, all worth reading before you venture into joining either. To attract members, each sometimes offers cash advances to a new artist/writer who just signed a big deal (although they “officially” deny this practice), and each also boasts about its unique monitoring system. BMI’s pitch is that they have the largest membership in the world.

But there is currently much debate over how fair the systems for ASCAP and BMI are because to some it seems as though the payouts favor certain writers or types of music. SESAC has managed to dodge this bullet for the moment, since they use an “objective” computerized monitoring system – but it is likely that they, too, will be under scrutiny soon as their membership grows.

There are other PROs in other countries. In fact, each European, Asian, and South American country has its own versions of ASCAP, BMI, and SESAC, but you need not concern yourself with them. For those with international hits originating in the U.S., the three main PROs mentioned above will attempt to collect from each of the smaller ones in the individual countries.

SoundExchange

Due to the internet, a new type of PRO designed strictly for collecting the performance royalties for digitally streamed sound recordings has been created. These days “digital streaming” means through the internet and over satellite radio. Why is this new? Well, in the U.S., sound recordings were never paid a royalty when publicly “performed.” That means, in simple terms, when a song played on the radio, the songwriter made a royalty, but the people who own the sound recording of that song made zilch. This includes the record company and the artist who performs the song. Hard to believe, but true. (In Europe and Australia both the song and the sound recording of the song are subject to performance royalties).

However, a new statute that allows for the collection of royalties from “digital sources” has opened up a fresh revenue stream for artists and their labels. This royalty is supposed to be split between the artist, the label, and the collective other musicians who played on the record in a 50%/45%/5% split, respectively. (The musician’s share actually gets paid to the musician’s union, the AFM, which supposedly distributes it to members using its own formulas.

While it’s true that so far the only sources for earning “digital sound recording performance royalties” are things like internet steaming/downloads and Internet and satellite radio, it’s a given that in the not-too-distant future many forms of transmissions (and distribution) will be digital, and thus we will see artists making additional money from these “performances” of their records. Examples might be the digitally “beaming in” of music to restaurants and stadiums, as well as cell phone ringtones and many other mediums.

Unlike PROs, who collect royalties for non-digital performances, wherein you have a choice of ASCAP, BMI, or SESAC, there is only one PRO to collect this new money: SoundExchange. SoundExchange collects and distributes millions of dollars a year to artists and labels. They have approximately 31,000 artist accounts and approximately 3,500 independent labels as well as the majors. In 2007 they took in $141,546,442 and for 2008 gross revenue is projected to be $154,260,000. Since they claim that their overhead is only about 7%, that means that over 93% of all this new money is getting split between artists and their labels.

25 thoughts on “The Companies That Make Up The Music Biz

  1. Great article!

    Gone are the days of the aloof artist that lives and breathes only for their art and lets everyone else manage their affairs and career while they are in a drugged out haze in the green room. Enter today’s arguably more talented and sophisticated artist that knows and controls every aspect of their business. Yes the market is now flooded with thousands of new songs and artists because technology enables everyone to make recordings. But if you really take the time to troll through the masses of artists actually doing business right now you would find that there is a richness and a depth to music that has never been experienced before.  In yesteryear when the industry was controlled by majors,  they dictated and marketed to generations of people bombarding them with a select few artists making those generations believe that the acts they were hearing were the greatest in the world when in fact, given the right environment there were potentially thousands of equally and maybe more talented artists that never got their shot a the podium.

    Not any more.

    Morris1988 If you believe that the only music out there is the “teeny-bop” acts then you must be part of the generation that sits back and waits for music to be marketed to you. I emplore you to scratch the surface, “take the red pill” (Matrix reference) and see the truely rich and abundant music scene that there is out there today.

    1. Well now, ‘go easy’ there comrade – because I didn’t say ‘the ONLY music’ out there is all ‘teeny-bop’ acts – I said (more or less) that we’re constantly being ‘saturated’ with a plethora of these same ‘type’ of bands, each & every week or month. 

      Of course if you ‘dig deep’ (in any era of music) you’ll certainly find some gems here & there – but that’s not the point, nor what’s at stake here. What ‘is’ at stake here, is the fact that with nearly ‘everyone’ now, having the exact same ‘access’ to the exact same recording technology, and being able to push it all over the exact same internet now (hence, ‘flooding the market’)  – it actually backfires to a certain degree, by making it far more difficult for a band or artist to get noticed, discovered, or even signed any longer, that’s all. Keep in mind, in the ‘old days’ (from the late 40’s, early 50’s – on up until about the mid-90’s or so) there were FAR less bands & artists (compared to ‘today’) trying to ‘make it’ or get signed (again, this is not of ‘my’ opinion – it is a very well established fact, if you wish to look it up.) And even the bands from back then who did ‘not’ get signed – but yet, we’re VERY determined, STILL recorded ‘homemade’ records, demos, etc – and self-promoted them on their own. This is primarily what created the entire ‘underground’ movement and produced a TON of great (and even ‘legendary’) albums throughout all of those decades. Part of the ‘fun’ with underground music back in those days, was the ‘thrill of the hunt’ in trying to find them! You would have to look high & low for a gem, or sometimes for great lengths of time just to finally ‘locate’ or actually find somebody who you’d been searching for – but in the end, all of that just added to the ‘thrill’ of discovering something new or unheard of – so unlike what you’re trying to suggest – all of this is nothing ‘new’ at all, and certainly doesn’t justify you claiming that some previous generations of music-lovers simply preferred to sit-back & wait for music to be ‘marketed’ to us. 

      (c’mon, seriously?)

      So seeing how ‘rock-n-roll’ (or music) in ‘general’ has been operating for nearly the exact same way over the last 50 years or so (up until about the past 7-9 years roughly) – leaves me with no clue what-so-ever as to ‘who’ or ‘what’ generation you’re even speaking of. Within every single one of those music ‘generations’ – there’s ALWAYS been tons of folks who didn’t just ‘scratch’ the surface as you stated, but rather ‘dug’ (and dug quite ‘deep’ I might add) WAY below the surface, always trying to find ‘what else’ is out there, or the ‘undiscovered gems’. Hell, I’ve spent most of my life combing DEEP within the Vinyl shelves, cassette stacks, CD racks – you name it, just to find a lot of those ‘unsung heros’ out there that are actually now ‘cherished’ today. I hardly ever even listened to the radio, or especially anything that was extremely ‘popular’ or so vastly ‘marketed’. But again, that’s not just ‘me’ that searched-out all of that ‘good-stuff’ – again, true music-lovers have been doing that for AGES – hell, that’s a large part of the overall ‘fun’ of it all. Yet, you implore for myself & many others from past generations to “take the new, red-pill and enjoy the new, ‘rich & truly abundant’ music of today….” – like that concept is something completely ‘new’ and has never been thought of before?  (seriously?)

      And besides that – where exactly ‘is’ all of this rich, new, great & undiscovered music you speak of? 

      I mean, (assuming that it does in fact exist, which I’m sure some of it does, so don’t think I’m trying to come off as being rude or disrespectful here)  – but ‘where’ and/or ‘how’ exactly does one find it?  

      I know you’re going to say, “the internet man!!” – but that’s my point. The internet has become so large & vague (practically ‘endless’ now)  – you can hardly find anything! Or maybe another way to put it, is that you actually find way, WAY too much. (Remember the old saying, “too much excess can do harm…”) – I think it actually applies here. I know (speaking for myself here) that if I don’t ‘know’ EXACTLY which band or artist I’m looking for now  – great chances are that I’ll NEVER just find them on a ‘whim’ now – period. The internet is just too damn big for that. 

      Plus, you get FAR too may ‘recommendations’ from everyone now as well. I personally enjoyed it a lot better back when I was recommended to listen to, or simply heard about maybe 2-3 bands ‘a month’. Whereas now – I seriously receive recommendations for ‘new’ bands, on average of about 20-30 per week!! I’m sorry, but that’s just way too many! Even if I bought all of those records (at that rate) – when would I ever get a chance to hear them all? Much less, ‘enjoy’ them all? 

      Really, the bottom line is this:  There’s Pro’s & Con’s to everything (that’s a given) – I just personally believe (and I know for a fact that I’m nowhere ‘near’ alone on this one)  – that the ‘Con’s’ are really starting to outweigh the ‘Pro’s’ within the entire music industry now. 

      Record stores are completing closing down at an alarming rate each & every month now, CD’s are almost completely extinct now (and are predicted to be completely ‘gone’ from all stores within the next 20 months), which also brings an end to the ‘album cover art’ era, as well as the lyrics, poster fold-outs, liner notes, etc (and I’m sorry, but a 1-inch, cheap digital jpeg image quickly appearing on an ipod, does NOT count for great album cover artwork), the overall ‘sound quality’ for most albums have taken a backseat to MP3’s – mostly due to the desire of ‘downloading’ at higher and faster rates, etc, etc, etc, (list goes on & on…..)

      But ‘Yes’ – there ‘are’ Pro’s for the new music industry as well  – I just think it’s funny when the ‘main’ one I ever really here (over & over) – is the quick, “Yeah, but at least now – EVERYBODY has a chance to ‘make it’ and get some ‘exposure’, plus – they can totally do it all on their own as well!!” 

      Like I said before, technically speaking – EVERYBODY has always had a chance of ‘making it’ since rock was first born. You just either had to be somewhat talented (or ‘good’) -or- brought something ‘original’ & ‘cool’ to the table. Whereas ‘now’ – none of that really even seems to matter anymore, and what good is it really doing if we’re basically just replacing the more talented, original, ‘good’ shit – with just mostly plain ol’, trite, ‘shit’? 

      Where’s the great ‘trade-off’ in all of that? 

      So sorry ‘Nutsonsound’  – but when you said (quote) 

       “IN YESTERYEAR WHEN THE INDUSTRY WAS CONTROLLED BY MAJORS,  THEY DICTATED AND MARKETED TO GENERATIONS OF PEOPLE BOMBARDING THEM WITH A SELECT FEW ARTISTS MAKING THOSE GENERATIONS BELIEVE THAT THE ACTS THEY WERE HEARING WERE THE GREATEST IN THE WORLD WHEN IN FACT, GIVEN THE RIGHT ENVIRONMENT THERE WERE POTENTIALLY THOUSANDS OF EQUALLY AND MAYBE MORE TALENTED ARTISTS THAT NEVER GOT THEIR SHOT A THE PODIUM  – NOT ANY MORE.”

      (well first off, you make it sound like Adolf Hitler was in charge of ALL music distribution within the country back then – ‘Wham’, ‘Barry Manilow’ & ‘New Kids’ maybe – but as for the rest, c’mon – I don’t think it was quite that bad…..) 

      – but even if what you were saying was completely true –  how is ‘today’s’ music or the way it’s being  ‘marketed’ to today’s youth, etc – ANY different? I mean, are you honestly trying to say that acts like ‘Brittney Spears’, Beyonce, Green Day, Maroon 5, Kate Perry, Taylor Swift, (do I really need to continue?)  – you’re actually saying that with today’s vastly ‘new & improved’ music ‘industry’ – artists such as ‘these’, AREN’T being ‘dictated & bombarded’ down everyone’s throats?   I mean, if what you’re saying is in fact ‘true’ – then ‘how’ is this ANY different from ‘yesteryears’ totalitarian techniques? 

      * truth be told, there’s ALWAYS been ‘potentially’ thousands & thousands of ‘equally’ & maybe even more talented artists that never got their ‘shot’ at the podium (always has been, always will be) – but I don’t agree with you when you state “that was all in the past……….but not anymore.”

       – sorry, but it’s all still the exact same. 

      Again, the main difference between ‘now & then’ is simply that there’s FAR more people, artists, bands, etc (more than ever)  – trying to claw their way to the top now, make it big, get their 15 minutes – whatever. Hell, everybody from Ivy-leauge college professors to professional magazines (such as SPIN, Rolling Stone, even TIME) have stated time & time again, that not only is the music industry facing some ‘serious problems’ within these next few years, but also they’ve stated that artists actually have ‘harder chances’ NOW with getting signed (or ‘making it’)  – then they did just 10-30 years ago! I mean, doesn’t that say something? And then they add that even if a ‘break-out’ artist of today (who somehow does ‘make it’ all on their own) – chances of surviving in the business over a ‘long-term’ career were nearly slim-to-none, (with one math professor at MIT even stating that “for an independent artist’s career to survive for even just 5 complete years, he or she would stand a better chance at winning their state’s lottery, ‘twice’)

      Again, those aren’t ‘my’ opinions – just ‘stats’ that other professionals have stated, averaged, predicted, etc. But even though I could really care less about ‘stats’ like that  – again, my personal main objection (and opinion) is simply that the overall Con’s seem to be outweighing the Pro’s now, within the industry. I really do hate that it’s happening this way, but that just seems to be the case now, yet it’s surprising as to how many people don’t seem to see ‘the whole picture’ (or maybe just haven’t had the time to really sit down & give it some additional thought?) Who knows? 

      (and besides all of the above – seriously – I think if an artist or bands’ music is really ‘that damn good’ – it will speak for itself and probably will make it’s way to the surface at some point – ‘big corporations or not’……..)

      1. I’m not saying that I disagree with everything that you are saying here….it would be hard to disagree with ALL of it. (There’s so MUCH written here!) But, I can guess that you are 1. A musician/artist trying to “make it” 2. Younger than 30 years old, and can’t fully understand the vast difference between the music industry before and after the internet became part of our everyday lives and 3. A mostly pessimistic person. These are guesses. Just a note…guess #3 will directly influence the success of guess #1, if they both happen to be true.
        – Evil fellow musician, Sara Tiemogo

  2. Even though some of this is ‘decent’ info to have on hand – it appears to me (and a LOT of other ‘professionals’ I’ve spoken to within the ‘business’)  – that with nearly everything changing now within the music business, the music-market itself is simply being ‘flooded’ – hands down. With just about everybody and their grandmother who now owns a laptop, a microphone, and some type of ‘recording/mastering’ software – records an album in their dorm-room (generally of much poorer quality and not of ‘good’ songwriting either)  – simply ‘floods the market’ with FAR too many ‘bubble-gum/fashion’ albums & records, & in turn, making it WAY more difficult for the more experienced, ‘talented’ musicians/songwriters to even get noticed now. We’re being pushed nearly ALL the way to the back of the line, due to mostly silly ‘fad’ acts being displayed on places such as ‘YouTube’, ‘Facebook’, ‘PureVolume’, etc.

    Don’t get me wrong, every blue moon – perhaps a rare, talented ‘someone’ makes it out, or gets noticed. But face it, for the most part – it’s just turned into a rather ‘mayhem’ type of situation with hordes of ridiculous ‘one-hit-wonders’, dorm-room kids with virtually no talent or ability to write even a half-decent song, or again, some ‘popular, mega-good-looking-YouTube-phenomonoms’ who only last for a few months, or at most –  a year. 

    What happened to the art of the ‘album’ – or really ‘great bands’ who’ve truly worked hard for perhaps years? – and yet, can barely (if at all) even get somewhat ‘noticed’ by nearly anyone? It seems like most so-called ‘artists’ now, simply want to ‘get to the top’, and as quickly as possibly – while forgetting about things such as overall ‘quality’, long-term stamina, actual ‘live’ experience, great song-writing skills, and yes, natural talent. What happened to all of those ‘real’, genuine artists all of the sudden? 

    Now we’re just being bombarded with a plethora of ‘teeny-bop’ acts, who seem to care more about their ‘hair styles’, clothing apparel and overall hollywood ‘image’ than anything else. And apparently – ‘this’ is what ‘sells’ now, and is the new ‘music business’ of today (even according to Rolling Stone & SPIN magazines.) 

    I’m sorry, but this is just downright ridiculous.

    And trust me, I’m not ‘envious’ at all. I’m more ‘pissed’ than anything, and simply miss the age of ‘great bands’, artists, and wonderful musicians, who actually produce records worth listening to AND buying at the same time. This should have been the ‘age of technology’ that benefited ‘us’ (who’ve put the time in, worked hard, and now have the ability to create ‘great’ albums) – NOT for these lame, ‘American Idol’ corporate fad-monkeys.

    I only bring all of this up, because whenever I read articles such as these – I’m simply ‘confused’ more than anything else. ‘How’ exactly are we supposed to ‘market’ ourselves & achieve success, when the ‘mainstream’ out there only seems to prefer more or less ‘over-night-sensations’ with maybe ‘one’ trick song up their sleeve to offer, who can barely play their instruments (if at all?) and are literally ‘forced’ to saturate every, single vocal track of theirs with ‘AutoTune’ (give me a break) – AND, seem to be more or less ‘Karaoke’ singers when it’s all said & done? 

    (and let’s not forget, ‘American Idol’ winners, wind-up selling more albums than nearly anyone else in the entire  business now – and that’s EACH & EVERY damn year, over the past 7 years now! (check BillBoard if you don’t believe me.)

    Again, not only is this extremely ‘sad’ & ‘depressing’ for hopeful artists (‘real’ artists) such as most of us – but it’s also degrading in itself, destroying the music business as we know it, and for the most part – makes it EXTREMELY difficult to even stand a mere chance now in ‘making it’. 

    Times have definitely changed (along with some great technology as well)  – but I just can’t see ‘how’ it’s honestly changed for the ‘better’. 

    (unless you’re a goofy teenager with a laptop, coifed with a ‘justin-bieber-hairdo’ to boot, insane amounts of ‘free-time’ devoted to posting cotton-candy-crap all over YouTube, mostly catering to 13-16 year-old girls, who wish to ‘party like rockstars’ & aspire to becoming professional ‘whores’ & ‘pornstars’ someday, according to their trendy new ‘T-shirts’ that their gracious parents buy for them at the mall.)

     – absolutely pathetic.

    (the chinese once said, “May you live in interesting times”………….they obviously weren’t forced to listen to ‘K$iesha’ every 7 minutes while watching the Kardashians sisters ‘in-between’ each of those 7-minutes.)

  3. One thing he got wrong:  he said: “The record company agrees to pay the owner of the copyright a compulsory
    licensing fee of about 9¢ for each song on a record, and for each
    record sold.”
    That money is paid for each copy MADE regardless of whether it sold or just sits in a warehouse collecting dust. It is a “mechanical fee” ans is actually paid for the precess of manufacturing the physical medium (record, CD, tape, etc.)

  4. Furthermore, though, it might be cool to address the concept of a “management company” as distinct from a Record Label or a Production Company

  5. Hello Moses,
    Great article! Your book “Confessions” should be mandatory reading for every serious musician who wants to take their career to the top. I’ve been seriously developing my “Music Business” skills since I first read your book 6 years ago. However, since I read your book I’ve also acquired other books, I highly recommend. “Music, Money and Success” by Jeff & Todd Brabec; “Music Law” by Richard Stimm (2009) and “Guerrilla Music Marketing Handbook” by Berklee Instructor Bob Baker are all “Excellent” and provides the “bigger” picture for the Indie Artist, and gives you the KNOWLEDGE of not getting sucked into Recording Label Deals or any other deals that come your way. I am STILL JUST DEVELOPING my strategies to go on the Internet, and I’ve been at it for over six years!!
    And Thank You Moses, for sending me your regular e-mails. You have no idea how this helps me.
    Bill B
    songsearchmusic@shaw.ca

  6. Reading this makes me a little intimidated. when do lawyers come into play, and how could i possibly hire one without money to pay him? I mean, when my mailbox gets flooded who do i turn to to sort it out?

  7. Interesting note about the “compulsory rate” vis-a-vis the ’76 Copyright law. I just had 2 CDs reissued by Wounded Bird (licensed by my original label Warner Bros. Reprise). Anybody care to put me in touch with someone who can learn how many copies were actually sold by Warners and now Wounded Bird?

  8. Thanks for the “Heads Up”. There’s quite a bit of which I was not aware. I can see where a novice songwriter/performer could get into trouble in ways never dreamed of. It appears as though it as a verification of the old adage….”Do your HOMEWORK and check everything out up front “, before signing or doing anything. The business is MUSIC…treat it a such.

  9. Paradigm shift; It’s a whole new set of rules, and a little hope for those of us old enough to remember the old analogue days when it cost a fortune just to track a record, under the gun because time was money and you had to answer to somebody else; now all you have to answer to is yourself “is this good enough?”, and to your audience, “will they buy it?”

  10. I appreciate the comments here. Easy to understand.

    I just question one point that was made. The one regarding wedding bands having to pay royalties. I called ASCAP about that and they told me that, since it was a private affair (by invitation only) it doesn’t fall under their jurisdiction.

    Unless they changed their policy. Then I’m talking out of my hat.

  11. I always try to learn something about the artists side of the music business and hope they try to learn about the radio side of the business as well. Well written exerp. Interesting about SESAC. I can tell you that they are not radio friendly and we do not play SESAC artists due to their fee structure. I would love to know what they promise that would pursuade and artist to forgo the opportunity to get spins on WAGS radio.

    Jim Jenkins
    Owner/Gen Mgr
    WAGS Radio
    142 WAGS Drive
    Bishopville, SC 29010
    (803) 484-5415

  12. I feel an injustice to writers who make the lyrics. although we don’t produce the music we still fill the void where it brings more fufillment to the score! something needs to be done for songwriters to get more recognition at award shows and Media events! The Oscars do it! so should AMA ! Debo Kneedeep ent.

    1. I agree that song writers need nore recongnition. After all, the song writer puts his or her heart and soul into their lyrics. Whether the song is in most cases, telling a realistic story about an events, feelings and emotions, things that happen to someone which all of us can relate to. The lyrics are really the key to a good song. Yes, you have the sayin’, they are just words, a poem with out music and an good artist who puts emotion and feeling to the song. But without words, singers can’t do this, and without words, the music is just a musicial. It takes all three to create a good song.

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