Music News Bulletin - 16/01/09

Talent retains value in publishing: Companies look to grow alternative revenue streams as mechanical income falls
Financial worries may have continued to impact the music industry over the past 12 months but, while record labels have dealt with their diminishing returns through reduced A&R budgets, the big publishers have remained aggressive when it comes to securing new artists. The year’s most sought-after deals – names such as White Lies, Glasvegas and Iglu & Hartly - managed to enter the higher regions of the six-figure price tag, while some of the big songwriter deals eclipsed even this.

As revenue from mechanical royalties continues to fall, however, the publishing sector is beginning to evaluate the validity of those artists worth their signature in new ways. Areas that in the past may have merely supplemented income from record sales can today create key revenue streams for artists and publishers and an artist’s potential in this area can make or break a deal." [MusicWeek]

Sony could post losses of a billion
"I lost a ten pound note the other week and found the whole experience quite stressful, so imagine what it must feel like to lose $1.1 billion. Well, that's the losses Sony Corp might post for the current financial year, ending 31 Mar, according to sources cited by Billboard.

Although some analysts reckon the mainstream entertainment industry will probably be hit less than most by the recession (despite the current turmoil in music retail) as consumers turn to relatively cheap music, film, games and telly to cheer themselves up (instead of more expensive luxury goods or premium pursuits) the economic downturn is already having a big negative impact on those who make and sell consumer electronics, as consumers put off buying that new TV or camcorder amid fears of mounting job insecurity. For an entertainment conglom like Sony, whose electronics business is key, this is not good news." [CMUDaily]

Global digital music sales grow as music industry develops new business models
"The music industry has transformed its business models, offering consumers an increasing range of new services with leading technology partners. Yet generating value in an environment where 95 per cent of music downloads are illegal and unpaid for is still the biggest challenge for music companies and their commercial partners.

The digital music business internationally saw a sixth year of expansion in 2008, growing by an estimated 25 per cent to US$3.7 billion in trade value. Digital platforms now account for around 20 per cent of recorded music sales, up from 15 per cent in 2007. Recorded music is at the forefront of the online and mobile revolution, generating more revenue in percentage terms through digital platforms than the newspaper (4%), magazine (1%) and film industries (4%) combined." [RecordOfTheDay]

Music News Bulletin - 09/01/09

Bill Nguyen on digital music January 7th, 2009
"If you can get your hand on the latest copy of Billboard (10th January it says on the cover) make sure you read the Opinion piece on page 4. In addition to giving a good pitch, Lala.com’s Bill Nguyen wrote a short and well formulated article on listening to music online and business behind it. My favourite quote:

“The web is home to more new music each year than was released in many previous decades. Critics say the music is mostly junk - but the same could have been said for the Web before Google made the knowledge there accessible.”

I couldn’t agree more." [HeutePopMorgen]

Could this be the future of online collaboration? Tuesday January 06
"Minimum Noise is a new site offering users the opportunity to make money by contributing parts to other musicians' work, or pay to have others supply the missing parts to their unfinished projects. It's an intriguing idea, and the lure of cold hard cash is always a tempting one. So is this the way we'll make music together in the future, or a creative dead end?" [ComputerMusic]

EU Public Affairs Monitor - 19/12/08

RIAA to end its “Sue The World” policy
“In a week dominated by the Leonard Cohen classic, can I just say "hallelujah". A year that began with the news all four majors had ended their kamikaze love affair with digital rights management, is ending with the news that the Recording Industry Association Of America is axing its other self-defeating, unhelpful, surely-record-company-execs-cant-be-this-dumb policy of suing individual music fans over their use of P2P file sharing technology to acquire or share unlicensed music.

From the word go the RIAA has been at the forefront of the litigious approach to tackling the piracy threat of the internet, which was good news for lawyers, but bad news for pretty much everyone else, not least the record companies who had to foot the bill for the legal campaign that was destined to fail from the word go, and which destroyed the already sagging reputation of the record industry at a time when it needed public and consumer support, partly because the labels were clearly going to have to develop direct customer relationships moving forward, and partly because it needed enough goodwill to fight for a re-evaluation of copyright systems.
The original strategy was to sue any company making P2P networking possible. But it soon became clear that suing Napster, Grokster, Kazaa et al was not effective because, even when the US courts eventually started to find in the labels' favour, the kids had always transferred their loyalties to newer P2P systems by the time older ones had been sued out of business.” [CMUDaily]

Culture announced an imminent "unpopular" measure against piracy
“Molina says that EU ministers have in their agenda actions against practices "illegitimate"

Today, Cesar Antonio Molina, the Spanish Culture Minister, announced that "not too late" there will be legislation, "which is likely to be unpopular" to regulate Internet piracy, a practice that has branded as "illegitimate" during the ‘Breakfast Briefing Europe Press’ and that, in his view, affects the whole culture.

Asked about the possibility of blinding access to Internet pirates repeat, Molina has stated that they are "exploring ways" and that "not too late there will be a regulation" this whole issue. Probably it’ll be a regulation that will be very unpopular, but what is unpopular, dilapidated and a disaster is that thousands of jobs that gives the culture will disappear by this illegal action. That can’t be allowed, he said.

Also, Molinas says that from the Ministry of Culture is struggling and acting very well" against piracy since "many fronts" and that at European ministers meetings is a "reiterative theme”, with the development of new laws and new forms of organization, to prevent piracy, "a termite that is destroying entire network of industry, to acquire such extreme shades."” [UFI]

Copyright cop wedding crashers fined by Spanish court
“The next time you have a wedding, make sure your videographer isn't a secret spy for the RIAA or similar copyright group. This real-life scenario happened to a couple in Spain thanks to the efforts of the Spanish General Society of Authors and Editors (SGAE), a rights group for musicians and artists. But although the group managed to bust the reception venue for copyright violations, SGAE itself has been fined for violating the privacy of the newlyweds.

The incident originally took place back in 2005, when SGAE snuck a private detective into the wedding reception acting as a cameraman. The group had suspected the venue—La Doma restaurant near Seville, Spain—for using music without paying royalties. Predictably, this series of events have horrified privacy advocates who argue that the couple's privacy was breached. As noted by The Sunday Times, however, the issue has come to light recently because SGAE has increased its efforts to catch venues that are avoiding royalty payments, and another, similar case is about to go to court.” [ArsTechnica]

EU Public Affairs Monitor - 15/12/08

UK consumers, Big Content battle over three-strikes rules December 01, 2008
"Although France's "graduated response" proceedings have attracted the most attention, the UK is in the midst of a consultation of its own on how to involve both content owners and ISPs in some sort of response to P2P file-sharing. The government is pushing a co-regulatory approach that would task industry groups with hashing out the details of such a plan, while the government would make sure that any agreement is fair, competitive, and preserves privacy. With all the responses now in, the UK music industry is clearly pleased that it won't have to pursue 6.5 million copyright infringers on its own. Digital rights groups are... less excited.

The entire consultation is helmed by BERR, the UK agency that handles Business, Enterprise, & Regulatory Reform, and it stems from the famous (in certain circles, anyway) Gowers Review of intellectual property that we covered extensively back in 2006. That report, which took a top-to-bottom look at UK copyright and IP policy, was stuffed with plenty of consumer-friendly ideas, such as no new copyright term extensions. But it also contained good news for rightsholders, such as a suggestion that the government step in if ISPs and rightsholders couldn't agree on how to handle the issue of P2P file-sharing." [ArsTechnica]

Voluntary campus-wide music licenses could stop the lawsuits December 08, 2008
"It takes a special knee-jerk churliness to jackboot the music industry in the proverbial groin every time it comes up with a new idea. Sure, some of these ideas (Hi, DRM-laden CDs!) make one want to spend an afternoon banging head against desk in existential despair over the low collective intelligence of the people in this world who make decisions. But the industry isn't staffed only with fair-use hating zombies and DRM lovers; the occasional human roams the hallways, sometimes hatching new schemes that aren't wholly stupid, ridiculous, or evil. When that happens, it's worth holding one's rhetorical fire until the idea is fully developed, offering encouragement and constructive criticism.

Of course, Internet groin kicks are easier. And think of the traffic! But they're not always helpful, not when you'd like the industry to get up and walk arm-in-arm into the sunset with users rather than lie in the street and issue subpoenas from the gutter." [ArsTechnica]

Masnick on the Music Tax Dec. 15, 2008
"I’m more sympathetic to EFF-style voluntary collective licensing than Mike Masnick is, but I have to say that the case he makes here is pretty compelling. I think this is really the key point:

What you’re doing is setting up a big, centrally planned and operated bureau of music, that officially determines the business model of the recording industry, figures out who gets paid, collects the money and pays some money out. The same record industry that has fought so hard against any innovation remains in charge and will have tremendous sway in setting the “rules.” The plan leaves no room for creativity. It leaves no room for innovation. It’s basically picking the only business model and encoding it in stone. [TechLiberation]

Taxing music at the ISP level: Good idea or bad? Dec 5^th
"Warner Music Group has a proposition for U.S. universities, according to Techdirt: buy a blanket license to music downloads through file-sharing services, or be sued.Techdirt thinks that this is a bad idea, and I disagree. Techdirt's criticisms are clear." [CNet]

Lessig’s call for a “simple blanket license” in Remix 01/12/08
"Lessig Remix coverI’m finishing up Stanford Law School professor Lawrence Lessig’s latest book, Remix: Making Art and Commerce Thrive in the Hybrid Economy and wanted to make a brief comment about his call for a “simple blanket license” to solve online music piracy.

Overall, I thought Prof. Lessig made a good case regarding the benefits of “remix culture” and why copyright law should leave breathing room for the various derivative works of amateur creators. On the other hand, Lessig still too often blurs remix culture with “ripoff culture” (i.e., those who aren’t out to create anything new but instead just take something without paying a penny for it).

To solve that latter problem, Lessig again endorses a proposal that William Fisher, Electronic Frontier Foundation, and others have made for collective licensing of all online music, but he fails to drill down into the devilish details. He says, for example, that “by authorizing a simple blanket licensing procedure, whereby users could, for a low fee, buy the right to freely file-share” we could “decriminalize file sharing.” " [TechLiberation]

Techdirt's Mike Masnick On Why a Music Tax Is a Mistake December 11, 2008
"Techdirt founder Mike Masnick has followed the twists and turns of the digital music debate for more than a decade, offering some of the most prescient and lucid information and arguments on the topic anywhere. Today he tackles growing calls for a voluntary music-licensing scheme, pushed most recently by Warner Music Group to universities, that would basically allow file sharing by having ISPs impose a surcharge on all users to be paid out to copyright holders. (A version of this has been done before with blank media like tape cassettes in some markets, including Canada, but this would be a massive expansion of the idea.)

Mike's take is not the final word on the matter, but it should be required reading for anyone interested in understanding where music is today and where it is headed. It is reproduced with permission below in its entirety. As he ably argues, the future of music is often confused with the future of the music business — but they are not the same thing at all. In fact, the interests of the music business, defined primarily as the major recording labels, is arguably one of the biggest impediments to moving music itself forward." [Wired]

Music News Bulletin - 25/11/08

Anderson downgrades Long Tail to Chocolate Teapot status: Metaphor swallows Man 21st November 2008
""The end came quickly," as authors of morbid weepies like to say. On Monday WiReD magazine editor Chris Anderson effectively admitted game over for his "Long Tail", the idea he's been dragging so lucratively around the conference circuit for the past four years. In as many words, he downgraded it from "the future of business" to something that's, er, not very helpful for your business at all.

"I'll end by conceding a point: It's hard to make money in the Tail," Anderson wrote. "The revenues are disproportionately in the Head. Perhaps that will never change."

As befits a quasi-religious cult, the straw that broke the Long Tail's back wasn't empirical evidence, but the Word of God. The Google God, to be precise - Eric Schmidt. Will Page's exhaustive analysis of tens of millions of music transactions from a giant digital music store had already prompted a last ditch stand. But it was remarks by Schmidt, however, interviewed by McKinsey, that prompted the downgrade. Schmidt said they make most of the money in the top 10 per cent of advertising inventory." [TheRegister]

Artist Royalty Program (Slight Return) November 7th, 2008
"This is a blog post I wrote for the Last.fm blog, head over there if you want to join the discussion:

With the Artist Royalty Program we wanted to solve a crucial problem. Since we started in 2002 we had licensed music from various ‘content owners’ (major and indie labels as well as digital music distribution companies), and we also paid money to collections societies all over the world. But there were certain artists and labels losing out: those who do not have access to all the above, or chose not to be part of this traditional music industry network." [HeutePopMorgen]

The Long Fail: the cost of digital distribution November 25th, 2008
This is a my recent contribution to the Music Think Tank where you can join the discussion:

Digital distribution as well as promotion has undoubtedly been the best thing that could have happened to music fans as well as musicians. Even bigger content owners are finally seeing the opportunities (instead of the threats) that come with the technical change of delivering ‘media’ over the last ten years. It is now easier than ever for artists to connect to their fans and delivering the music to them, gatekeepers have been eliminated and (in theory) artists can reach out to millions of music fans out there through the internet. So far, so good.

Everyone who works in music knows that there are various new challenges that have developed through new digital delivery methods and those challenges can make it difficult to monetize digital music. I won’t be going into the issue of file sharing (there are enough people out there who have something to say about that) but I want to explore a common misunderstanding about digital media: “digital distribution is free” (or at least very cheap). It is not at the moment." [HeutePopMorgen]

Music News Bulletin - 17/10/08

Giving your music away October 17th, 2008
"I’ve been thinking some more about my post last week, debating how much you actually earn from selling your music online these days. Coupled with the news that’s been finally weaned from Radiohead’s ‘In Rainbows’ Album and the fact that the more forthcoming Trent Reznor’s figures on Nine Inch Nails’ ‘Ghosts I-IV’ album, I thought I’d blog further on the topic of what you can earn by giving your music away.

Regarding ‘In Rainbows’,”More than three million people acquired the album,” points out Warner Chappell Music senior vice president of International Legal & Business Affairs Jane Dyball, who admits “I had doubts there was money to be made online”. That figure includes downloads sold across various retailers, and physical packages sold online and through brick-n-mortar stores, and Dyball noted that 1.75 million copies of the physical, full-priced release were shifted. The band may have decided to not give out any specific figures on sales, but that hasn’t stopped people from estimating revenue ($10m in the first week?) and average price paid per album ($5? $8?). Other companies are saying that these figures don’t allow for those who paid $0 for the album (ComScore.com), and Radiohead’s representatives then reply that those figures are inaccurate but don’t give us anything solid to go on. Despite the option of a ‘$0’ price on the official website, between October 10 and November 3 2007, ‘In Rainbows’ was still downloaded from Torrent websites to the tune of 2.3m downloads. So just about no-one can figure it all out once the Torrent numbers are thrown into the mix." [UKMusicJobs]

Royalty rate stays same for iTunes, other download services October 02, 2008
"The Copyright Royalty Board has handed Apple and other online music store operators a big victory, as it has decided to keep the royalty rate the same for physical media and "permanent" (nonsubscription) music downloads. The decision, which was handed down Thursday afternoon, defines the mechanical rate terms for songwriters and publishers as 9.1¢ for physical products (like CDs), as well as music downloads, mitigating fears that significantly raised rates might force the closure of popular online music stores.

In addition to keeping the mechanical royalty rates the same for downloads, the CRB also established a rate for ringtone purchases for the first time—24¢. Music publishers may also now seek a 1.5 percent late fee per month from distributors that don't pay up on time." [ArsTechnica]

Universal Music CEO Still Doesn't Believe In The Promotional Value Of Music 14/10/08
A year ago, we were fairly shocked at an interview with Universal Music CEO Doug Morris. The guy gleefully explained how clueless he was about technology, and said that he didn't even know enough to hire people who could properly guide him to understanding how technology was impacting the music industry. Furthermore, he displayed an ignorance of basic economics and basic finance at the same time by insisting that any sort of promotion that might pay back tenfold at a later date was bad business because it meant someone was "taking advantage of you." Yes, apparently, the idea of spending a dollar today to make back ten next year makes no sense to the CEO of a large company. We wondered how Universal's shareholders could possibly let someone so gleefully clueless continue to run the company.

Apparently, he's still at it, and still not afraid to open his mouth and expose his ignorance. In Morris' latest interview he insists that the company doesn't believe in promotions, but wants to get paid for every single use of its music." [TechDirt]

Slate: Dump MySpace Music, Bring Back Muxtape 03/10/08
"As we had suspected, the early reviews of MySpace Music make it sound like a dud. It sounds, not surprisingly, like the focus was on appeasing the big record labels, rather than actually making a service that's fun and easy to use. Farhad Manjoo, over at Slate, makes the argument clear, contrasting MySpace Music to Muxtape, the small indie site that the RIAA shut down when it couldn't own a big chunk of it. As Manjoo notes, Muxtape was fun, it worked well, and people liked it. MySpace Music, on the other hand, is just not that compelling. He notes that it doesn't offer anything other sites haven't offered for a while, and on top of it, makes the whole interface cluttered and confusing, while limiting what you can actually do. Once again, we see the RIAA shut down a useful service and put up a dreadful competitor." [TechDirt]

Music News Bulletin - 16/10/08

Behind the music: How would you like your music served? October 16 2008
"Do you want to download it on your phone? Would you pay? Do you hate ads? I really want to know. Recently, I was sent an analysis of Radiohead's In Rainbows pay-what-you-like venture and Nine Inch Nails' digital giveaway of their album The Slip – including an account of how they fared against Torrent websites such as Pirate Bay. It was written by Will Page, chief economist for MCPS-PRS, with the help of Eric Garland who runs BigChampagne – a company that measures legal and illegal downloading – so it was quite heavy reading.

The odd thing about In Rainbows was that, even though people could have got the album legally for "almost" free, between October 10 (the date it was released on the band's website) and November 3 2007, it was still downloaded from Torrent websites to the tune of 2.3m downloads. Even though Radiohead have hesitated to give specific figures relating to the success of their venture, outsiders would say that those Torrent downloads far exceed the downloads from the band's official site. In fact, on October 10 alone, almost 400,000 people took the album from Torrents."[Guardian]

Behind the music, In the City October 10 2008
"Feargal Sharkey once said, and I'm paraphrasing: "When God handed out bullshitters, he gave an extra serving to the music business." I tend to agree with him, and at the In the City music conference this past weekend, there were a few of them lurking around.

In the City is a three-day event in Manchester, set up some years ago by Tony Wilson, where people from the music business have panel discussions during the day and spend the evenings checking out showcases by unsigned bands. This year the discussions focused on music's future in a digital world, and as is so often the case in this business, there were few artists present. But one panel centred on the rights of the people without whom the business wouldn't exist, as they discussed the launch of the Featured Artists' Coalition." [Guardian]

The Big Royalties Debate October 8th, 2008
"Congratulations! You have recorded a kick-ass song and a major label wants to sign it and distribute it to a worldwide audience. The trouble is, just how much will you be rewarded for your years of hard work?

The fact is that people don’t buy singles on CD or Vinyl for £3.99 anymore – they pay £0.99 (if you are lucky) for a download, so the record companies have a lot less coming to them (read: a lot less to share with you). Sales have gone crazy with the advent of the digital revolution, but that is just the tip of the iceberg; there has been no set royalty rate agreed with music publishers and the RIAA. No wonder everything is such a mess!" [UKMusicJobs]

Digital music royalties for songwriters left unchanged October 2, 2008
"A sigh of relief could be heard in digital music land today as the federal Copyright Royalty Board left unchanged the rate for royalties paid to songwriters and publishers for CDs and digital downloads.

Today's ruling is the first time that the board formally set the digital download rate. Previously, because there was no formal rate for downloads, companies such as Apple had used the CD rate -- a 9.1-cent payment to the songwriter and/or publisher for every track sold through iTunes and other download stores. The board today also set a new rate of 24 cents for each ring tone, which had been independently negotiated." [LATimes]

Music News Bulletin - 29/09/08

Industry Groups Reach Agreement On Internet Royalties 23/09/08
"In an agreement that ends some cases of litigation and encourages new ways for consumers to listen to music online, a number of key industry groups have reached an agreement on digital royalties and have sent the recommendations to the Copyright Royalty judges. This agreement was necessary to encourage new models without scaring away current and future entrepreneurs and enthusiasts." [Coolfer]

Survey Reveals Opportunities, Threats of Unlimited Music Services 29/09/08
"Today's music industry is often one step forward, one or two steps back. As progress is made in new formats, products and services, revenue is lost in the abandonment of older formats and products. With unlimited mobile music services on the horizon, now is the time to ponder their impact." [Coolfer]

CEO David Pakman to Depart eMusic 29/09/08
"eMusic, the world's largest retailer of independent music and the world's second-largest digital music service after iTunes, today announced that President and Chief Executive Officer David Pakman will depart the company. Pakman will become a partner at a premier venture capital firm. The name of the firm is undisclosed. eMusic has retained the Barlow Group, a Connecticut-based executive search firm to recruit a new chief executive." [MarketWatch]

Free Music: Good or Bad and/or Inevitable? 29/09/08
"While reading the comments to Michael Arrington's positive review of MySpace Music at TechCrunch (seen via Idolator), I came across two comments that perfectly sum up the worries about free music. The move toward free music (free streaming, actually, not free everything) is an inevitable and positive step, but it brings with it permanent changes. Both comments point to the public's attention going to the most popular artists at the expense of everyone else." [Coolfer]

So Long, Music Week 29/09/08
"As of today, I'm a former reader of the Music Week website. Amidst changes to the print publication and a redesign of the website, articles have been hidden behind a subscription wall. Not just its charts and features are inaccessible. The previously accessible short daily news bites are behind a subscription wall. The only free content I could find is the infrequently updated A&R Blog. The UK trade publication offers news that gets overlooked in the U.S. and it's unfortunate that I will no longer be able to read and link to their articles." [Coolfer]

High Drama Over Digital Royalties 28/09/08
"There was a high level of drama this weekend as supporters of Internet radio, spurred by a plea from Pandora, voiced their support for the law passed by the House on Saturday. The Webcaster Settlement Act authorizes SoundExchange to negotiate new royalty agreements for Internet radio through February 15, 2009." [Coolfer]

New organisation to represent industry 26/09/08
"An historic agreement was reached yesterday afternoon with eight industry bodies, including the BPI and AIM, signing up to launch a new umbrella organisation that will “present a unified industry voice” to be headed by BMR chairman Andy Heath and chief executive Feargal Sharkey." [MusicWeek]

Pirate Bay Wins Court Case, Italian Block Lifted 25/09/08
"The Pirate Bay has successfully appealed the decision of an Italian judge who had ordered ISPs to block access to the popular BitTorrent tracker last month. The Court of Bergamo decided that this block was unlawful, and that Italian users should regain access to the site." [TorrentFreak]

A Chat With Merlin CEO Charles Caldas 25/09/08
"Earlier this month, MySpace finalized deals with three of the four majors -- only EMI has yet to join -- to create MySpace Music. The majors will receive equity in the standalone company and will receive a share of its ad revenue." [Coolfer]

Poptastic MySpace Music launches, without indies: Big splash for Big Music 26/09/08
"MySpace Music, the ambitious new joint venture between the major record labels and News Corporation, has finally gone live. Don't let the name mislead you - the only thing it has in common with the scrappy ethos of the original "MySpace" is the name.

Executives have said they want the service to be "the new MTV", and the launch offering certainly lives up to those low ambitions." [TheRegister]

EU Public Affairs Monitor - 24/09/08

The PRO-IP Act: A game-changing law and its implications
"September 2008. In the waning weeks of what was a long and arduous presidential election campaign, people seemed so intensely focused on the campaign itself, they had probably forgotten George W. Bush would still be President the day after the election. And while the nation’s attention on the weekend of September 26 was focused on a bailout to fix the exploding economic crisis, most failed to notice that Congress passed a law whose impact remains at best unseen for musicians and the music industry. The Prioritizing Resources and Organization of Intellectual Property Act of 2007, also known as the PRO-IP Act, was passed with unanimous consent in the Senate and with an overwhelming majority in the House (renegade Republican presidential candidate Ron Paul was one of the few who voted against it, as well as the original draft of the Act in May).

The law itself is not much of a change from previous acts of similar nature (raising fines and punishments against people caught with pirated music and such), except for one major point: The law creates a new office in the White House whose purpose is dedicated to copyright infringement matters and whose head official would dictate copyright policy. This so-called “IP czar,” a term used by both the RIAA (Recording Industry Association of America) and the digital rights’ advocacy group Electronic Frontier Foundation, would direct the Department of Justice and Attorne2y General as to how to handle piracy cases and the increased rate of piracy through P2P sharing." [TinyMixTapes]

Internet Radio is (almost) saved? Sep 24th 2008
"Remember how last year there was a big to do about the future of internet radio? The US Copyright Royalty Board imposed new, higher fees for online broadcasters, and web radio services like Pandora and Last.fm complained that the new fees would effectively put them out of business. A bill was introduced in Congress to work things out, but that never really went anywhere. But now, a year and a half later, the Digital Media Association, which represents a number of online music distributors, announced an agreement with copyright holders. It just doesn't exactly cover internet radio.

Here's the deal. If you're a company that provides limited music downloads or interactive streaming audio, you have to pay 10.5% of your revenue in royalties, less any amount owed for performance royalties. That covers subscription based services like Rhapsody which let you download music to your PC, so long as the music becomes useless when you stop paying up. It also covers interactive sites like Last.fm which let you select the songs you want to play." [DownloadSquad]

Agreement Reached on Internet Royalties September 23, 2008
"The contentious issue of digital royalty rates has reached a tentative conclusion, at least as far as putting agreements on paper is concerned. In an announcement made today, the warring parties entered what is termed a "historic" agreement. Whether this new agreement will challenge the Magna Carta in 800 years remains to be seen. However, in the meantime it appears the feud has been settled for interactive music services and limited download services, but the Internet radio debate remains unresolved.

Whenever an Internet radio station plays a song, it has to pay a royalty. That royalty rate remained firm at $0.000768 from 1995 until all hell broke loose in 2007. In early 2007, the US Copyright Royalty Board (a bizarre sect of the Legislative branch) increased the rates substantially. And not by a few hundred thousandths of a dollar - we're talking somewhere on the order of 300%-1200%, enough to make Internet broadcast giants such as Pandora contemplate ceasing operations. Oh, and for added kicks the rate would be retroactive to January 2006." [Slyck]

Music News Bulletin - 23/09/08

New royalty agreement leaves Internet radio out in the cold September 23, 2008
"This afternoon, the Digital Media Association announced a new agreement with organizations that represent musicians and songwriters that will provide a streamlined licensing procedure for many models of digital music distribution. The new agreement doesn't apply to "download to own" music, but will apply to streaming services, including subscription and ad-supported music (think Last.fm and SpiralFrog). The agreement has been submitted to the Copyright Royalty Judges for approval.

For the purposes of this agreement, musicians and songwriters were represented by he National Music Publishers' Association, the Nashville Songwriters Association International, and the Songwriters Guild of America. They negotiated the deal with the RIAA and the Digital Media Association, which includes industry heavy-hitters like Amazon, Apple, and Microsoft. But the DiMA also includes a variety of companies that are doing less well under the current system, such as the recently-purchased Napster, and Internet radio services like Live365 and Pandora, which are buckling under the current royalty system." [ArsTechnica]

Music News Bulletin - 29/08/08

Now Hollywood is chasing UK downloaders: And getting the wrong guy 29/08/08
"Tiscali threatened to disconnect a customer for illegally downloading a TV show last week, after receiving a copyright infringement notice from a Hollywood studio. The only problem was the customer had quit the ISP months before the alleged transgression was made." [TheRegister]

Pandora prepares to join titsup.com club: Web radio outfit struggling to cover royalties 18/08/08
"This weekend saw a cry for help from personalised web radio outfit Pandora. It blubbed that music industry royalties are too high for it to survive on meagre web 2.0 advertising revenues. In a Washington Post confessional, the firm's founder and CEO Tim Westergren said: "We're approaching a pull-the-plug kind of decision. This is like a last stand for webcasting."" [TheRegister]

World shocked (shocked!) by Legal P2P: Old news sinks in 13/08/09
"Why does the idea of legal P2P - something music fans have been clamouring for since the original Napster - still cause so much confusion? Britain is set to be the first country outside Korea where punters will be offered such services (as we revealed back in June), but the idea still seems too incredible for many journalists and bloggers to comprehend." [TheRegister]

EU Gives Green Light to Sony's Acquisition of BMG 16/08/09
"Yesterday the European Union approved Sony Music's acquisition of Bertelsmann's half of its Sony BMG joint venture. Last month Sony agreed to purchase BMG from Bertelsmann for around $900 million. The need for regulators' approval is a standard procedure and an especially potent topic in a recorded music market with such concentrated ownership. The EU approval effectively ends an appeal by indie trade group Impala that asked the EU to rescind its original approval of the merger. As I wrote last year, indie label sales in the US -- either because of or in spite of the merger -- fared well since the merger. From the time of the merger through October of 2007, a period of just over three years, Sony BMG's share of US album sales dropped to 21.76% from 29.78%. Indies rose to 20.55% from 17.58%." [Coolfer]

Another Case Against Long Tail Economics 15/08/09
"At Harvard Business School's Working Knowledge, John A. Quelch has a post titled "Long-Tail Economics? Give Me Blockbusters!" Quelch is the Lincoln Filene Professor of Business Administration at Harvard Business School. Quelch explains the benefits and lures of blockbusters and offers five characteristics that define a blockbuster. His bottom line is this:
More risky than pursuing blockbusters is not to pursue them, to condemn your enterprise to a lifetime of slave labor harvesting the long tail of micro-opportunities rather than imagining, pursuing, and marketing the global solution to an important, widely shared problem." [Coolfer]

EU Public Affairs Monitor - 04/06/08

YouTomb: A YouTube takedown May 20, 2008
"Some enterprising MIT students are raging against the machine. In this case, they are targeting YouTube, the video-sharing website run by Internet giant Google.

The students' website, YouTomb, documents which videos are removed from YouTube for alleged copyright violations or other reasons, so they don't disappear unnoticed. You can't watch the videos on the site, but you can find out what happened to them." [LATimes]

The (knife) fight over Internet radio royalties continues June 4, 2008
"Joe Kennedy, chief executive of Pandora, carries a weapon in his battle over Internet radio royalty rates that he says could kill his popular online music site: a Stiletto.

Not the old-fashioned, sharpened-steel knife popular with mobsters and dancing street gangs in "West Side Story." This is the high-tech Stiletto 100 Portable Satellite Radio from Sirius. Kennedy brandishes it when he meets with members of Congress to highlight what he calls the inequity of the royalty rates.

The Stiletto has two antennas. One picks up Sirius' satellite signal and the other connects via Wi-Fi. But songs played over those connections pay different performance royalty rates." [LATimes]