Royalty Fraud

From cheating managers and promotors to IRS issues and straight up financial mismanagement, there are many reasons the list of music legends who have lost it all is a long one.  David Acosta, CPA is an expert in helping music artists navigate and protect themselves from the financial downside of the music industry. Here’s what he has to say regarding royalty fraud.

How does royalty fraud happen?

There are many variables when it comes to royalty distribution and the calculation of rates. It is an extremely complex and controversial process.  Not only do rates vary by type (CDs, digital, streaming, television and film, video games) but the calculation of royalties is different for songwriters, publishers and the recording artist. As Courtney Love pointed out in her letter to music artists, “Record companies also reduce royalties by “forgetting” to report sales figures, miscalculating royalties and by preventing artists from auditing record company books.”

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How Artists Should Deal with Auto-Renewing Contracts

It’s easy to fall into the routine of scrolling past terms conditions agreements without thinking much about them. However, they can often affect the future of your music, where it can be released, who controls it, and how it can be distributed. For example, a licensing agreement can change how future revenues are received (or waive future royalties entirely); a contract with one distributor might limit future opportunities with another; some sponsorship agreements will bind you/your band members to one specific type of product. These are all instances when you are limited by the choices made without full consideration of long-term effects.

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The Artist Compensation Storm

As sure as dark clouds gather in hurricane season, a storm is brewing around artist compensation. Art and technology are at odds. However, it wasn’t always that way.

From the advent of cassette multitracks in the ’80s, to the arrival of digital multitracks in the ’90s, to the maturation of digital audio workstations in the ’00s, affordable, cutting-edge technology enabled recording artists to seize the means of production. The rise of the internet enabled them to marshal the means of distribution. Without those home studios, without a free internet, artists would still be trying to catch the ear of some well-connected impresario who could foot the bill for commercial studio time and old-media publicity. It’s a plain fact: thanks to technology, producing and distributing music is a lot easier than it used to be. And artists have reaped the benefits.

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An Open Letter to My Senator, Ron Wyden, Regarding the Internet Radio Fairness Act

Senator Wyden,

I am writing regarding the Internet Radio Fairness Act. I am a musician, registered Oregon voter and participant in the Future of Music Policy Summit on November, 13 2012. In fact, I played the role of Oregonian #1 during your speech. I volunteered my time to contribute to the event and involved myself by managing the stage for the presentations, an activity I receive 20-35 dollars/hour for in Portland, placing me in a front row seat for the event. We met immediately before you began your speech. I am fairly certain you don’t know my name, it is Graham Smith-White. Given the nature of the government in these United States, I am not surprised by this. I most certainly do not think it positive, however. It is this discontent which moves me to write to you on the matter of the Internet Radio Fairness Act which you introduced to the United States Senate and supported in your presentation at the FMC Policy Summit.

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How PROs Collect & Distribute Royalties (Part.1)

Authors, composers and publishers have the right, but not the obligation, to register with Performing Rights Organizations (a.k.a Collection Societies, internationally) for the collection of royalties.
The primary function of PROs is the intermediation between copyright holders and entities who wish to use their music publicly (ex. a business establishment that broadcasts background music).

They can take the role of your lobbyist, your “agents”, and most importantly, your royalty collectors.

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Free peek at broken system of music reporting rights

Dirty secret: Musicians and songwriters all know that if their music is being played commercially, the reports they are getting back are more than likely wrong. Cue sheets and affidavits are routinely entrusted to interns to fill out – sometimes by hand. One misspelled song title and the artists wave goodbye to their royalties.  In fact, over 80% of music played commercially is either unreported or misreported.

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Big Machine's Deal with Clear Channel: A Win for the Music Business?

At the beginning of June, it was announced that Big Machine Label Group struck a groundbreaking deal with Clear Channel that will provide payment of royalties to artists and record labels for terrestrial radio play. What does this mean for the music business? Let’s break this down:

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SongTrust: “We need more people to pay attention to their publishing”

Songtrust is a music publishing organization that helps indie artists and working songwriters register their songs with agencies around the world while collecting royalties for radio play, television play, online play and other sources.

For a flat yearly fee of $50 for a solo act and $100 for a band, Songtrust will register 15 songs, create exposure for sync licensing opportunities, collect on U.S. and Canada royalties, while the artists keeps 100% of their copyrights and royalties. I first heard about Songtrust a few weeks ago, as I started to notice that they are doing some pretty heavy online campaigning with banners on just about every music related website on the web. So, curious me decided to reach out to them via email and I was able to have a brief interview with Songtrust’s Marketing Manager James Aviaz.

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Let's get real about streaming!

Okay streaming is here and very soon Joe + Jane Doe consumer will know all about it. The majority, as some predict, are honest and will subscribe to a service paying a minimal monthly fee. And they’ll love how cheap music is for them to get. 

But who gets the money? Labels and songwriters are the beneficiaries of the royalties paid, but it hardly compares to revenue generated from sales. And what about Johnny and Jeannie who are the non-writing part of the band and get two points each from the group’s record deal? They are screwed! 

try the free beta of Kollector, a realtime worldwide radiobroadcasts tracking system

free beta on www.kollector.com/en

Kollector is an online application telling in REAL TIME when (date and hour) and where (country, radio station’s name) a specific song is played on radio. The end result is then displayed and detailled with several lists, diagrams and graphics, allowing for important groundbreaking possibilities in the management of musical repertoires FOR ALL IN THE MUSIC COMMUNITY.

AUDIO WORKS MANAGEMENT TOOL/ ROYALTIES MANAGEMENT HELPING TOOL

• Tracking of albums/single airplays and discover trends before it’s gone public.

• Follow-up of promotions.

• Planning of tours and evaluate the potential of regional markets.

• Immediate feedback on efficiency of singles.

• Comparative watch.

• Realtime vital and worldwide datas that can be shared with partners.

• Help forecast airplay royalties for publishers and collecting societies.

Discover the new opportunities of realtime online airplay tracking and try the free Beta version on www.Kollector.com/en

The Real Reason You Fail To Make Money From Your Music

I’m going to keep this one short and straight to the point. The music industry is a hard one to make money from, we all know that. When it’s all said and done however, if you’re talented, have been making music for a while and don’t make any money from it, you’re doing the wrong things!

For a lot of people, their idea of promotion is adding people on Facebook and Reverb Nation and messaging them about their music. In all honesty, this is doing next to nothing for your music career. How much money do you ever make from doing this? My guess is none, at most you’ll get a small ego boost when the odd person replies saying your music’s good.

The thing is, this type of marketing is very short term and a big waste of your time. While social media should be a part of your strategy, looking for fans one by one isn’t the best use of your time. If you stop and analyse your results in terms of sales from this promotion, I’m sure you’ll come to the same conclusion.

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Why the RIAA needs to be put down

I agree heavy downloaders and especially uploaders of copyrighted content should be punished. I agree drastic measures need to happen. But the RIAA, with the wonderful aid of the majors, got us in to this mess with no evident progressive steps since.

Its an old governing dog incapable of learning any new tricks. RIAA (Recording Industry Association of America) is that stereotypical Chinese mother smacking her child round the head every time a hand goes in to that cookie jar. There is one way of educating and one way only. Punishment.

I understand why they have to do this. Music is dependent on money from its intellectual property. Artists need to eat. Royalties put food (and often coke) on the table. It’s how the music industry has always functioned. And it always will be - surely?

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WebCeleb Thinks Fans Should be Paid to Listen to Music They Like

WebCeleb is a social music marketplace with a great business model for music fans.

If you’re a musician…not so much.

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Make Music, Make Money: Upcoming Artist Development Series

The Rights Workshop Presents Artist Development Seminar Series: Make Music, Make Money

Series runs September 29-October 1, 2009

San Francisco — In response to the growing interest in music placement and promotion, The Rights Workshop is hosting Make Music, Make Money, a series of career development seminars for artists, musicians, composers and other content creators beginning Tuesday, September 29 through Thursday, October 1, 2009. Each Make Music, Make Money seminar will be held from 7:00pm to 9:00pm. Seminar attendees will learn about the mechanics of the music business and develop strategies to earn more money from their creative work. In each Make Music, Make Money session, panelists will address commonly asked questions about the rapidly changing music industry in a comfortable, artist-friendly environment.

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