THIS OPINION PIECE IN TODAY’S GUARDIAN may be weighted with legalistic argument, but it reveals the chaos that digital media — downloads and ringtones, for example — have brought upon the music industry. It also confirms the pitiful rates musicians and performers have been paid for their work in the past…
“At the centre of [recent lawsuits involving Eminem and the late Rick James] is the question of whether a download is a licence or a sale. A normal record deal today would usually give an artist 12–20% of revenue from sales depending on how successful they are at the point of signing (only the bigger artists get anything close to 20%). But if a song is licensed to be played in, say, a TV show or a film, they receive 50% of revenue. Buying a download on iTunes may make you feel like you own it, but the fact is that you’ve just bought the rights to play it. And so the court agreed that the Eminem downloads counted as licences.
“Universal argues that it was simply the wording of Eminem’s specific contract that resulted in them losing the case, and it’s true that standard contracts have changed since the advent of iTunes and now clearly state that download sales count as sales. But thousands of artists signed their deals way before iTunes. If they did so before 1980, chances are they’re on a sales royalty rate that is lower than 10% — some artists from the 60s and 70s were on 4%, minus packaging deductions — which means they can up their digital royalty rate more than tenfold.”
➢ Continue reading Why Eminem could spell major trouble for the major labels — by Helienne Lindvall in The Guardian, April 29, 2011