file sharing and labels faltering

You've heard all of the panic over file sharing and labels faltering, but what are the REAL issues in the music industry? Consider these four problems that don't get much attention in the music media but that have a huge impact on the industry.

1. Royalty Collection Companies Antics

Of course you should get paid when your music is used, but royalty collection companies are crossing the line of idiocy in your name. From trying to collect additional royalties on music usages you are already compensated for (ringtones) to demanding music fans pay for a public performance license for listening to the radio in their stable with their horses, the actions of these companies seem to have more to do with making up for their own financial problems than making sure you get your due.

The problem - aside from the fact that you pay a fee for this service - is that your fans don't know that you have little control over what your royalty collection company does in your name. To them, you're the greedy one. Great impression.

2. Internet Copyright and Royalty Issues

Sure the internet offers lots of options for music promotion, but what licensing regulations should be in place? Who gets to decide what is fair usage? Should labels be able to pull their artists' music off of sites like YouTube against the artists' wishes? Speaking of YouTube, what is a fair royalty for video plays on such a site? How do you balance the need of musicians to be paid for their work with the realistic earning potential (and ability to pay) of sites that host music?

Focusing on fan file sharing turns attention away from the real problem: the inability for music rights holders to hammer out a realistic game plan for licensing and compensation with websites that host and promote music.

3. The RIAA/File Sharing Lawsuits

Much like the first item on our list, we have a group that is damaging the relationship between musicians and fans, all in the supposed name of their music industry members. Many musicians and labels have spoken out against file sharing lawsuits, but for the RIAA, debate is out of the question. The average music fan doesn't really know enough about the industry to understand that their favorite musician isn't the one going to around suing fans for hundreds of thousands of dollars for sharing music. Their actions don't do much to stop downloading, and they create a bad impression of the music industry with fans.

Also, we don't have any good answer about how these judgements that the RIAA have won will be distributed to musicians. Interesting.

4. Radio Royalties

The US is one of the only countries in the world that does not require terrestrial radio stations to pay royalties to performers. A proposal is in place that would change that. The plan includes a sliding scale so that small stations would pay as little as $1,000 per year. Community stations would almost always be exempt.

Unfortunately, the debate over the issue has been controlled by Clear Channel - the Wal-Mart of radio stations - and people who make a lot of money for hosting shows and making radio appearances. They don't want these royalties to be paid because they would lose a lot of money, and they've managed to frame the debate so that they seem to be championing for the little guys. Don't you believe it. Musicians deserve to be paid.

 

Making money in the music industry isn't always as simple negotiating a salary and waiting for your paycheck to come in. The pay structure of many music industry jobs is based on percentages for one-off deals and freelance style work, but different music industry careers are paid in different ways. For this reason, the music career you choose will have a big impact on how you make money in the music business. Here, you'll find a look at how several common music industry jobs are paid, but remember, as always, that this information is general, and the deal you agree to will dictate your circumstances.

Managers:

Managers receive a pre-agreed percentage of the income from the artists they work with. Sometimes, musicians may pay managers a salary as well - this often works like a retainer, ensuring the manager doesn't work with any other bands. However, it should be noted that this latter scenario really only comes into play when the artists are making a sufficient enough income to support themselves comfortably and legitimately have a need to make sure their manager focuses only on them. Find out more about music managers

 

 

Music Promoters:

Promoters make money on ticket sales for the gigs they promote. There are two ways this can happen:

The promoter takes a percentage of the proceeds from the show after recouping their costs, giving the remaining money to the artists - this is known as a door split deal

The promoter may agree a fixed payment with the musicians for their performance and then any money left after costs is theirs to keep

Music Agents:

Agents take a pre-agreed percentage of the fees for the shows they arrange for musicians. In other words, if an agent negotiates a fee with a promoter for a band they represent to be paid $500 for playing a show, the agent takes a cut of that $500. Learn more about agents:

 

Record Labels:

At a very basic level, record labels make money by selling records. Your job at the record label and what type of label you work for will determine what this means for you. If you have your own record label, then you make money by selling enough records to cover your costs and make a profit. If you work for someone else's record label, you will likely get a salary or hourly wage. The size of the label and your role there determines how big that salary/wage will be. Learn more about record labels:

 

Music PR:

Whether radio plugging or conducting press campaigns, music PR companies get paid on a campaign basis. They will negotiate a flat fee for working a release or tour, and that fee will usually cover a set amount of time for the company to promote the product/tour. Music PR companies may also get bonuses for successful campaigns and reaching certain thresholds - for instance, a bonus if the album sells a certain number of copies. These agreements will be made before the campaign begins. Learn more about PR:

 

Music Journalists:

If music journalists work freelance, they will be paid on a per project or contract basis. If they work for a specific publication, they will likely receive a salary or hourly wage. Find out more about music journalists:

Music Producers:

Record producers may receive a salary if they are tied to a specific studio or be paid on a per project basis if they freelance. Another important part of music producer pay can be points, which allow producers to share in the royalties from music they producer. It should be noted that not all producers get points on every project. Learn more about producers:

Sound Engineers:

Sound engineers who work independently get paid on a per project basis - this can be a one night deal, or they may go on the road and do sound for a whole tour, in which case they will be paid for the tour and may also receive P.D.s. Engineers who work with a particular venue exclusively are likely to receive an hourly wage. Learn more about engineers:

Musicians:

What about the musicians themselves? Musicians make money from royalties, advances, playing live, selling merchandise, and licensing fees for their music. Sounds like a lot of revenue streams, but don't forget they often have to share the money with the people listed above. Learn more about making money as a musician:

Obviously, there are lots of different way to make money in the music business, and many of them come down to percentages and contracts. For this reason, it is crucial that everyone is on the same page about the hows, whens, and how muchs of the pay up front - and you should always get it in writing.