The True Cost Of Piracy

Here's an interesting infographic from Background Check that examines the cost of piracy. It's out of date, but I felt it should be posted to illustrate a few points:

1) If you look at point one, the claims of the cost of piracy by all sectors are in the stratosphere. And why not, it's a guess. An educated one, perhaps, but still a guess. You and I could pull a number out of thin air and it would have as much legitimacy if we were part of an industry association or consulting firm.

2) Take notice to the anti-piracy budgets. Now keeping in mind that these numbers are out-of-date, you'll see that the music industry spends around 3 times more than the film or the software industries to combat piracy. How's that worked out?

3) Take a look at who the alleged pirates are. It's young adults age 29 or younger to be sure (we always knew that), but also about half the adults as well, and equally split between male and female. Piracy has become a cultural phenomenon.

The bottom line, when it comes to media, current anti-piracy policies are not working. In the end, it will take a market-based solution rather than a enforcement one if we're to see a true change in our culture.


Via: Background Check Resource

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The Boy Bands Are Back In Town

If you haven't noticed, boy bands are back and they're bigger than ever. As if New Kids On The Block and 'N Sync weren't enough, a new crop has descended upon us, much to the delight of teenage girls everywhere.

First came Big Time Rush, who are today's version of The Monkees, since they have their own hit show on Nickelodeon which regularly draws over 3 million viewers. I've even watched it a few times and I have to say that these guys are pretty talented, although as a boy band, you don't have the burden of playing an instrument competently. You do have to sing moderately well, and at least on the surface, Big Time Rush fills the bill (don't know what they really sound like or how much auto tune goes on).

Then you have The Wanted, who currently have a top 5 Billboard hit with "Glad You Came." Like Big Time Rush, the band was created via an open casting call, which on the surface sounds so very television-like and non-musical, until you realize that many so called "legit" bands or the touring band for artists are put together via auditions. That's basically the same thing. The Wanted want everyone to know that they can actually play instruments though, but as any musician with some gigs under his belt knows, it's a long way from playing an instrument to playing in a band to playing professionally.

But the biggest blockbuster is just now upon us. The British quintet One Direction is about to become a big piece of the music scene for the next year or so (for better or worse). They just made a bit of history by being the first UK artists to have their debut album (called Up All Night) enter the Billboard 200 at #1 (take that, Beatles). Already there's a huge groundswell as little girls in all 50 states anticipate their first US tour, which is guaranteed to make the news more than most of care to notice.

One Direction is the brainchild of former American Idol svengali Simon Cowell, who picked each member individually from the auditions for the British version of the X Factor. You may or may not like his shows, but no one ever said that he couldn't spot talent. We'll have to wait and see about this one though.

Even though One Direction is preparing to take the world by storm, they've apparently been laying the groundwork for quite some time via social networking, as did The Wanted. Months before they ever stepped foot on US soil, the boys engaged in a vast YouTube, Twitter and Tumblr campaign that was more about the guys "feelings" (according to The Wanted's manager Scooter Bruan) instead of being strictly promotional about the music.

This helps to confirm a number of things that I've been posting all along. All of these points come from my speaking at colleges and universities, where I poll the youth of today.

1) YouTube is the #1 music discovery tool used by kids today.

2) Twitter is incredibly powerful if you know how to use it.

3) Despite what you might read, kids are adopting Twitter as a primary social source.

4) Tumblr is coming on strong as a primary social network, and may be supplanting Facebook already in some age brackets.

The point is, you may not be interested in the new batch of boy bands in any way, but it's smart to look at how they're promoted, especially online. It's a blueprint that most artists can use.

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Bill Gates Enters The Music Business

It was recently announced that Microsoft co-founder Bill Gates is getting into the music business, which is an interesting move, although not in the way you might think.

Gates owns Corbis, which is a photo, film, video and art masterpiece library service, which is taking the next step by getting into the music licensing business by launching GreenLight Music with songs from the four largest music publishers.

What the service will do is allow film and video customers to purchase the license for a wide variety of songs available from a library of about a million strong, but in many cases the users actually have to bid on the song and negotiate with the publishers for a price instead of doing a clean purchase online.

One of the first deals that GreenLight did was to license The Monkees' "Daydream Believer" for $1,875 so it could be used during a corporate meeting. Just about any songwriter or publisher will take that kind of dough any day of the week.

The interesting twist is that GreenLight doesn't actually control the copyright to any of the songs in its library, it's merely a middleman. Since producers and editors are already used to checking out Corbis for visual material, it's a no brainer to offer the audio as well.

You may or may not like Microsoft, but no one ever said that Bill Gates isn't one smart guy. After all, he is worth about $56 billion. His action does show that someone actually is bullish on the business thriving in the future, as least on the publishing side of things.

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Turning A Press Kit Into An EPK

Every artist needs a press kit, and while most are familiar with the major parts (bio, pictures, discography, upcoming gigs, fact sheet, press clippings, etc.), you set off into a different realm when you go to the next level - the electronic press kit, or EPK.

In the old days a press kit was all hard copy that you'd have to send in the mail or deliver personally, but today your kit can be delivered either via your website, in an email via a PDF, or even on a CD or DVD. That said, you can take your press kit to the next level and truly make it an EPK with some powerful additions that are outlined in one of my books, The Musician's Video Handbook. This covers how to create all the different types of videos that an artist or band might need, and there's an entire chapter dedicated just to EPKs. Here's a brief excerpt regarding of some useful additional EPK elements that you can add.
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"An EPK is just a press kit in electronic form. All of the above documents (bio, press clippings, etc.) should be made available in PDF, Word or RTF files that can be placed either on a disc or a flash drive or made downloadable online. You can also consolidate them all into a single file if it’s not too long (more than 10 pages or so) and the individual details are easy to access. Here’s what should also be included:

Videos - You need multiple types of videos - interview elements with the artist or entire band, and if it’s a band, individual interviews as well (we’ll cover how to make these in a bit), your most recent music videos, any music video that you consider a “hit”, and a clip of a song from a show. It’s best to make two versions available - one with smaller web-ready files (we’ll go over how to do this in chapter 12), and if you’re an act that’s breaking nationally, another version that’s available in hi-res via FTP download.

Music - Your songs can probably be found online already, but make it easy for whomever is reading the kit by adding links to effortlessly find them. If you’re sending a hard-copy kit, include a CD of your latest releases, and a song or two from any previous releases as well. If you’ve done music for commercials or a soundtrack for a movie or television, include that as well but be sure that you have the right to do so before you include it.

Links to Interviews - If your EPK is on the web, include any links to interviews that you might have done, either audio, video or just text. This leaves it up to the discretion of the reader of the kit just how much she wants to listen to or read, and also keeps your kit lean.

Web-Ready Graphics and Banners - Be sure to include any graphic you might have of promo material or swag, including adverts, T-shirts graphics and the like.

Web Links - If the EPK is online but not on your site, or you’re delivering a hard copy kit, but sure to include a link to your website, as well as links to any social media presence that you have on the web such as Facebook fan page, Google+ page, blog, Twitter, Reverb Nation, etc.

Fan Endorsements - If you have rabid fans that do crazy things like paint themselves up with your logos, get tatoos of your likeness on their backs, or are just super enthusiastic, that could make for an interesting clip. Just make sure that the fans (3 or 4 is all you need) are completely enthusiastic and really special or this element isn’t worth pursuing."


You can read additional excerpts from this book and others at bobbyowsinski.com.

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You're Not Getting Your Royalties

Last week Jeff Price, the founder and CEO of TuneCore, wrote a very profound piece on the Hypebot blog about the amount of songwriting royalties that aren't making it back to the songwriter, especially from digital sales. It's always been a given that a major label would do everything it could not to pay you any royalties at all, but the following goes way beyond our worse nightmares.

This is a very long post, but well worth the read if you have any sales at all.
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"While the major music companies' revenue from music sales has gone down, they have a brand new increasing income stream: revenue generated from the sale of other people's music. In the past five years, hundreds of millions of dollars of songwriter royalties have been generated and never paid to the songwriter, or have been given to Warner Bros, EMI, Universal, Sony and others based on their market share- estimates put this new income at over half a billion dollars.

Once these companies get the money, they keep it and don't account to anyone.

All the while, the songwriters that earned this money have no clue their pockets are being picked, their royalties are not being paid, and their rights are being violated.

I discovered this infringement and lack of royalty payments while embarking on a journey to discover how much money TuneCore Artists earned as songwriters. In the past three years, TuneCore Artists have sold over 500 million songs and earned over a quarter billion dollars from the sale of the recordings of their songs. With the help of Jamie Purpora, the former SVP Bug Music Publishing Administration and now President TuneCore Songwriter Publishing Administration, we identified another $60 to $70 million earned by these artists in songwriter royalties. The upsetting part, over 70% of this money never made it back to them. And keep in mind, I'm only talking about artists that use TuneCore—there are many more.

This infringement and lack of payment is one of the biggest outrages of the music industry and yet it is rarely talked about and even more rarely understood.

It needs to stop.

Let me explain the nutshell version of how it happens.

The new music industry is global. However, outside of the United States, digital services require additional rights, use different royalty rates and pay the owed royalties differently than the United States music industry. The end result is:

• The digital music service does not get all the rights needed from songwriters and therefore never pay the songwriter the money he/she is owed. 
• At the same time, local performing rights and collection agencies outside the U.S. illegally take a % of the songwriter's money while making it impossible for the songwriter to get what's left over. 
• This illegally obtained songwriter royalty money is then given to other major music companies in that country. 

These other major music companies knowingly take other people's royalties from the collection agencies. (Why not, it's free money earned off of music sales from songs they don't represent that they do not have to pay royalties on).

This scheme is beyond outrageous, it's wrong, it needs to stop (and it's why we launched the TuneCore Songwriter Service).

How do they get away with it, three reasons:

1) The existing global songwriter administration system was built for analog, not digital.
The old school music industry was built for the world of analog TV, AM/FM radio and 12" pieces of vinyl or 5" circular pieces of plastic; it was not built for the digital world. However, this old "analog" system is used for the administration of royalties from the digital world causing other people's money not to make it to them. The "analog" songwriter collection and administration industry knows this is occurring but has no motivation to change its existing system as it allows them to take/earn hundreds of millions of dollars off of other people's royalties.

2) It's cheaper to violate copyright than pay songwriters.
The new emerging digital music services have no simple solution to get licenses from and make payments to copyright holders; it's a pain, it's complicated, and, for the moment, it's cheaper to take on the potential legal liability than invest resources and time to comply with the law and pay the right people.

3) The complexity of copyright law and a lack of transparency create huge barriers to understanding.
The complexity of copyright law, the total lack of transparency by the collection agencies and the inability to audit anything, and you have a perfect storm for global copyright infringement with hundreds of millions of dollars of other people's money getting siphoned off and/or not paid to the millions of rightful copyright holders."

Please read the rest of this post since it has information that's vital to your well-being as a songwriter.

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Copyright Math: The $8 Billion iPod

The music industry has constantly bellowed about how much money it's been losing to piracy since 1999 or so, and the numbers they've thrown around have been nothing short of outrageous.

The one I love is that for each download that's legally purchased, 20 more are downloaded illegally. They've somehow determined that the worth of each illegal download is $150,000, which is the initial number that the RIAA used in all it's lawsuits against file sharers until they realized the futility of using that number.

Rob Reid, author and founder of the company that created Rhapsody, had an interesting and humorous take on what he termed "copyright math" in a presentation at a recent TED Conference.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

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MTV Gets Back Into Music

Believe it or not, MTV used to be strictly a music channel and had a huge influence on the charts and music in general during the 80's and into the 90's. It has since become more of a lifestyle channel and now has much more of cultural significance rather than a musical one, but the network wants to change that by introducing a new online platform dedicated to music called Artists.MTV.

YouTube is currently the go-to place for music discovery, and MTV wants a piece of it, hence the venture. Not only will Artists.MTV be a place for indie and major label acts, but also for unsigned artists as well. MTV wants to be able to have a place where new acts can be heard, promoted and hopefully (doubtfully) paid, but this seems like a real uphill battle.

Van Toffler, president of MTV parent Viacom Music Group, stated at SXSW last week that the goal is to be an all-encompassing musical experience. "You may discover music on Spotify, Pandora, or even MTV Hive," he said, "then you look them up on Wikipedia. Then you go to your Facebook page and tell your friends. Then you go to Songkick and see if they're touring. Then if the artist is lucky, you go to iTunes. It feels like there's an infinite environment to discover music - buy it, listen to it or pirate it, but there doesn't seem to be a uniformed galvanized place where artists could get information to their fans." Well, how about the artist's website, Facebook page or Twitter feed?

So what exactly does Artists.MTV have to offer to artists? Not only will artists have another place for fans to discover their music, but thanks to a partnership with Topspin, artists will be able to sell their music, concert tickets and merch directly to their fans, as well as receive direct payments via a "tip jar."

But the biggest carrot is the promise to connect bands to MTV itself. Artists.MTV will offer a program called Full Frontal where one artist a month is selected for a promo campaign on MTV, VH1 and CMT. The band will be picked by the fans and a committee of artists, managers and producers.

The site will be open to artists in May, and fans can view the site via a private beta soon, although the official launch won't be until sometime during the summer.

Artists already have too many options available to them and feel overwhelmed by them. Artists.MTV might be different in that the network brand still has some cache, but they've long been out of the real music business, and the networks demographic may not be transferrable for all but a few acts. Time will tell whether Artists.MTV will be just another shot in the dark or will have some real traction, but if I were a betting man, I'm not so sure I'd be placing any money on them.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

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The Value Of A Fast Page Load

We live in a very impatient world and that impatience could cost you fans, users or sales. A study created by the OnlineGraduateProgram.com found a number of startling facts about our desire for online speed:

• 1 in 4 people abandon a web page if it takes more than 4 seconds to load.

• 50% of mobile users abandon a page if it doesn't load in 10 seconds.

• 40% of mobile shoppers will abandon an e-commerce site that doesn't load in 3 seconds.

• Google found that slowing search results by just 4/10ths of a second would reduce the number of searches by 8 million a day.

• Amazon estimates that it could lose up to $1.6 billion a year because of as little as a 1 second web page delay.

This means that you can't count on our ever expanding bandwidth for your site to load fast, you still must optimize it for speed, because tenths of a second count more than ever. This is one of the reasons to get a pro to build you website in order to be sure to get efficient, streamlined code. Page loading has become so much more than slimmed down graphics files these days.

A couple of other quick facts; the majority of Americans will not wait in line longer than 15 minutes, and half of them would not return to an establishment that kept them waiting. But we didn't need a study to tell us that.

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Billboard Finally Updates Its Charts

It took some time and is probably about 5 years too late in coming, but Billboard has finally updated its charts to include on-demand streams from services such as Spotify, Rhapsody, Muve, MOG, Slacker and Rdio to determine chart position. It announced it will also introduce a new chart for top on-demand streaming tunes immediately.

What's interesting is that the new charts are a product not only of Billboard, but also of Nielsen Broadcast Data System and the National Association of Recording Merchandisers. That said, the charts will mostly rely on data from Nielsen.

It's little known that Nielsen has been tracking music data streams since 2005, but has largely kept the data to itself. What they did finally release was pretty interesting, like in the first 70 days of the year it had tracked more than 4.5 billion audio streams, 625 million in the last week alone.

Another nugget is that streaming activity rose 17% in the week after Christmas while digital download sales jumped 20%, and that digital single song sales are up 7% this year so far.

A possible flaw in the system is that Nielsen doesn't track Pandora and what their more than 20 million users are listening to, but at least what they've done is a vast improvement of the past way of doing it, which was strictly by sales.

Billboard has been losing it's relevance for quite some time now and desperately needed to step into the future in order to survive. With fewer and fewer music stores and labels around, it's customers and influence is dwindling, and the company has laid off some of it's best people recently as a result.

Will this be too little, too late?

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The Square Register Make Merch Sales Easy

One of the major developments in the last year or so in the world of merch sales is Square. If you've been following this blog or have read my Music 3.0 book, you know that Square is a way to do credit card transactions on an iPhone or iPad very cheaply and easily. It caught on in a big way because it's way better than using a bank in terms of their transaction costs and the cost of a traditional credit card reader.

Now Square has done it again with a new iPad application called Square Register that's designed to let merchants ring up and track sales and just like a traditional cash register.

Register works with Square's existing card reader that plugs into the iPad's headphone jack, and also with Card Case, which is a mobile app for both iPhone and Android that lets you pay retailers without even removing the phone from your wallet. And if shoppers want to, they can even pay with cash (what a concept)!

The Square card reader is free, and you pay 2.75% of each transaction to Square, which is cheaper than just about any bank for a credit card transaction. Square Register lets the seller display all of the products offered for sale, so the person selling just has to tap to make the sale. The sale is tied to a dashboard app that lets you track inventory, taxes and other relavent sales info. Plus, you don't have to worry about the person on the merch table making a mistake or pocketing any of the profits.

Here's a way that makes merch sales so very easy that's it's no wonder it's taken the touring business by storm, yet it's cheap enough that any band can get in on it. Check out this short movie, then check Square Register out.

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Music's Top 10 Moneymakers

Billboard Magazine recently came out with it's top 40 moneymakers of 2011. Here are the top 10, which probably won't be much of a surprise. Keep in mind that these are not gross numbers, just estimates of the final rounded off net that went into the artist's pocket.

10. Adele - $13,000,000

9. Jason Aldean - $13,400,000

8. Celine Dion - $14,200,000

7. Bon Jovi - $15,800,000

6. Sade - $16,400,000

5. Lil Wayne - $23,200,000

4. Lady Gaga - 25,300,000

3. Kenny Chesney - $29,800,000

2. U2 - $32,100,000

1. Taylor Swift - $35,700,00

Interestingly, Journey came in at 12, the Cast of Glee at #11, and Foo Fighters at #31. Also, The Beatles came in at #24 just on the basis of CD and download sales alone.

Read the full list for yourself here.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

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Sony Caves To Artists In Class Action Suit

If you've read this blog much, you know that I've been keeping you up to date on the Eminem v. Universal lawsuit all the way along. The suit, which was eventually won by Eminem's production company FBT, was significant because it changed the way the music industry values a digital download.

The record labels considered a download sale to be just like a CD sale and therefore subject to the same royalty rate, which could be anywhere from 12 to 20 percent. FBT contended that a download was in fact, NOT a sale, and really was a license, which was subject to a much higher royalty rate of 50%. When HBC/Eminem won, it was predicted that there'd be a flood of classic artists suing their record labels. Sure enough, that's what happened, with a number of acts including The Allman Brothers, Cheap Trick and The Youngbloods filing a class-action suit right away.

Now it's been reported that Sony Music has filed a motion to settle with these acts, paying around $8 million and raising the royalty rate 3% in most cases, and 4.7% in the case of The Youngbloods. If this is approved, artists who have had at least 28,500 downloads on iTunes will be eligible. Ironically, many acts are choosing not to settle or be part of this action, preferring to file their own suit to get an even better deal.

This might seem like a win for the artists, but consider this. 8 million bucks is a drop in the bucket to a major label, and raising the royalty rate isn't that great either. The digital download cat has been out of the bag for sometime, which means that there won't be that many download sales forthcoming, and the next music distribution frontier is subscription, which pays even worse.

Yes, this seems like a victory, but at the end of the day the artists only received what will amount to a little bump. This isn't the only suit that's ongoing however, and it will be interesting to see if any of the others have endings along these same lines.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

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