Parental Advisory News Report 10.18.09: Videos Didn’t Kill The Radio Star

Posted by Dan Haggerty on 10.18.2009

This week in the PANR: Garth Brooks comes out of retirement, the Senate votes for radio stations to pay more for music, Kazaa to open new subscription service, Perez Hilton’s music tour a bust, labels loose bid to force ringtone royalties, British police to profile hip hop shows, Miley Cyrus and the Powerpuff Girls are NSFW, and we get the final word on Michael Jackson’s estate!

Intro & Feedback!
Sex, Drugs, Rock & Roll
NSFW
Below The Beltway
The Final Word

Greetings, salutations, and a big tall toast to all of my fellow members of the underground - Welcome to what is the pirate broadcast of News Reports as we call out the industry for the good, the bad, and the what the hell. Here at the PANR we don't look at the headlines. We take a walk on the dark side and go for the shit that hides underneath the headlines. Occasionally I find a gem or two that no one covered and I'm happy to report it, but mostly this is the ugly behind the beautiful people. It's the reports from the front lines and the boardrooms, the back alleys to the halls of Congress. It's the nuts and bolts that keep things running. It might be technology, trends, music, or business. One thing is for sure, most of this stuff isn't getting covered on any other pop culture website.

Enough with the promo work. Here at the PANR bunker (I need to photoshop something for that), we've had several weeks off thanks to work issues. I'll save the story for when I cross the finish line this Tuesday and just apologize to the many people (I can dream) that missed my column.

So, after a short vacation of sorts, here is what's going on in the biz!

Video Didn't Kill The Radio Star

The Buggles were wrong!

Several weeks ago I gave a full report on a move by the music industry to force radio stations to pay royalties on a song every time they play it. This would be in addition to the licensing fees broadcasters already pay for the right to play those songs. The idea being that the industry should be getting more money is that the fees now only pay for song writing royalties only. There should be a way to pay artists themselves proportionately for the use of their songs. The closer reality is likely the fact that the industry gets royalties this way from songs played in the internet and wants to expand the formula to every other avenue.

That feature got a good reaction from you guys, and I even got some feedback from some people actually in the radio business, which was helpful in understanding the things news bits leave out. As promised, here is an update on this plan as it moves from idea to possible reality.

This week its back in the news because a Senate committee has approved legislation that will force radio stations to increase the royalties they must pay. As of now, the bill is open to a full Senate vote while a sister bill of similar nature is already set for a floor vote in the House of Representatives. No date for a final vote is on the agenda and with a few issues like Afghanistan, Iran, and health-care on the schedule it might take till the beginning of next year for Congress to get to these bills.

Support for this thing is bipartisan, which is to be expected as property rights or business laws only develop partisan reaction proportional to the number of major news outlets covering it. Opposition is also bipartisan as the radio industry has managed to get 251 House members and 26 Senators to sponsor bills opposing the additional royalties.

Side notes on the bill included with the "pay per play": It has limits on the royalties that small educational and public radio stations would have to pay. It would also delay for three years the payment of any fees for stations with less that $5 million in annual gross revenue. Further, stations that have less than $1.25 million per year in revenue can choose to pay a $5,000 flat rate each year rather than the performance rights fee on individual songs while public broadcasters can do the same for a mere $1,000 a year. Broadcasting religious services incurs no charges.

The bill was passed in the Senate Judiciary committee, because pricing and contract negotiations in America are evidently done by a non-associated judicial oversight body on the east coast now, with the support of both parties. Patrick Leahy is the head of that committee and said the following regarding the law: "This legislation will end a glaring inequity in our intellectual property law".

I wasn't aware that forcing radio stations to pay twice for permission to use a song was fixing an inequity, or that simple business contracts like pricing was determined by law and not the people involved, but there you go. Of course, Leahy is the same brainchild behind the "Pirate Act", which the RIAA paid him to sponsor. That bill would have given the Federal Government permission to file civil charges in downloading cases. So instead of the RIAA suing unemployed moms for millions, the feds would have done it and kept the money.

Why do you people in Vermont keep putting that yahoo back in office? Christ.

Anyway, that bill got shot down at least. This one we'll have to wait and see.

The irony of all of this is two fold. First of all, the idea that is being promoted is that musicians don't get the money they deserve if their music gets played a lot. The implication is that forcing radio stations to pay more based on use will rectify that. The problem? Has any musician received a check from that lawsuit against that unemployed mom? How about that collage kid? The grandma that didn't even use the computer she got nailed on? Did the industry cut the artists that were victimized by these criminals a check for the stolen songs and damages?

I think not. They kept it of course. Going along with that, the music industry collects realties now throw non-profit organizations like SoundExchange. Insider's scoop says that this non-profit organization strangely keeps a cash surplus from unreleased royalties every year. up to the last available reports from 2007. Cash surplus, of course, means positive cash flow which is a politically correct way of saying profits… So much for the artists seeing all that money.

In addition to that, the second issue with this is that the music business is cutting its nose of despite its face. Literally!

The reason the music industry accepted the original method of paying for royalties was because they recognized the inherent free publicity they got from radio play. People hear a song they like and they go buy it. If it wasn't for radio, the labels would have to pay someone to promote the album and play samples to people. Radio does that for free. It was a good deal and they knew it.

Fast forward several decades to today and radio is hurting. More people turn to the internet for music because A) It's easier and on demand, and B) they can find the music they like. Toss in a recession and you have a business that is in big trouble.

Into this walks the music business that says "You need to pay us more, and we're going to have congress force you to do it!"

What do you think will happen?

I'll give you a hint… I hope you like talk radio. You're going to be hearing a lot more of it.

The Man With The Black Hat Is Back

Garth Brooks fans have reason to be cheerful this week. The country icon is coming out of retirement with some limited shows in Las Vegas, which is likely a prelude to greater involvement in music again. Wynn, of the famous Wynn Resort and Hotel (not to mention the dude who built then sold off a slew of other popular hotels on the Vegas strip), has contracted Brooks with a great deal. Basically, Wynn is paying Garth big bucks to fly in (on Wynn's expense) for 15 separate weekends next year to perform, and then fly him home afterwards.

I haven't seen any dollar signs, but I would have to imagine it was a sweet deal. Toss in the cost to put up Brooks for the weekend and the Wynn Hotel (upscale place, great expensive buffet), and fly him back and forth and this is a big deal for sure. Of course Wynn never thinks small. He's like Donald Trump without the sleaze or need to publicize himself because he doesn't loose money.

Brooks said that he was taking his first steps out of retirement because his kids were older now, and while still at home he thought they were old enough to make stepping out for 15 weekends a year no big deal. And really you got to hand it to the man. He stepped away from music and all that money (he's only one of the biggest selling artists of all freaking time) simply because he had three daughters and wanted to raise them properly. How refreshing is that.

When asked about a real tour, he said: "Our youngest (child) is 13. Living here, it took six months to record an album. I can't imagine what it would take not living here and coming back and forth. … As far as a tour, you know me, man. If I can't eat it, sleep it, breathe it, then it ain't me. So I don't see that happening."

I'm not a big country fan, but I've always like Brooks. He seems genuine which is the hallmark of a great artist.

Judge Says No To Industry Royalties Lawsuit

Wrong number for the ASCAP

A lawsuit from earlier this year came to an end this week, but you won't hear it being trumpeted anywhere. The music industry's royalty-collecting arm ASCAP sued AT&T because each time a cellphone ringtone goes off it claimed you're listening to a performance of that song. And of course, since it is a performance, AT&T should pay royalties for each time the phone goes off.

Thankfully, a federal judge (Denise Cote) ruled this week that a ringtone going off does not constitute a public performance, because the carrier has no way to control when a ringtone plays or any expectation of revenue when it does.

She went further as well by saying there was no way to determine whether the threshold for "public performance" could be met for any particular ringtone playback, because it requires a "substantial number of persons outside of a normal circle of its social acquaintances is gathered."

She should run as Senator of Vermont.

So phone carriers won't have to pay royalties on ringtones. BUT, and hear is the real deal, this could set a precedent as well. You might remember the story from over a month ago about the music industry wanting to get royalties for 30 second downloads from iTunes. Go back and reread the last two paragraphs. The judge's words apply to that as well, so this little case could be huge in the long term.

Kazaa Goes from Pirate to Buccaneer!

I couldn't find a good picture for Kazaa
so enjoy this picture of Kate Moss instead.

I wonder how many pirate geeks will get the joke above.

Kazaa, one of the original file-sharing services that started the whole "Property Rights" war, has announced that it is starting a new subscription music-streaming service that will go live by early next year.

It will be based in San Francisco and developed by Janus Friis and Niklas Zennstromand, and already has backing from the venture- capital firm Atomico Ventures. No idea who they are, but there you go. I'm assuming they're one of the many companies that's sole purpose is to manage other companies by risking capital in their new enterprises. Friis and Zennstromand however are well knows for starting the popular and successful Skype, so this is going to get a good push.

Anyway, back to the real deal here, the service will let its user's archive and share music through a Web browser and stream it to certain mobile devices. This is an American answer to a similar company in Sweden called Spotify Ltd. that plans to enter the U.S. market by the end of the year with a service that will be available on Apple Inc.'s iPhone.

"We have watched many ad-supported music businesses come and go," a company rep said yesterday in an e-mailed statement. "We felt the time was right to revisit this space, this time with a compelling offering and a sustainable subscription model." He also added: "The idea is to create a subscription streaming service that's between desktop and mobile… For someone who's interested on a subscription basis, the notion of ownership becomes less important than the idea of streaming on-demand."

The service is still being tested and pricing hasn't been determined yet as subscription versus ads versus user fees are being weighed. What is knows is that the company plans to have licensing deals with all four major music distributors.

Protecting The Innocent Or Profiling?

A dangerous scene?

Form 696: It is used by Metropolitan Police in the UK to gather details of promoters and performers. It was changed last week "so as not to be primarily aimed at live music", but will focus on "large promoted events between 10pm and 4am which feature MCs and DJs performing to recorded backing tracks".

In other words, if you run a hip hop show extra police will be there and watching.

According to police it is necessary to track artists and promoters who have attracted problems, allowing officers to prevent violence by putting extra security in place or shutting down shows. "Detailed research identified which events are most likely to attract crime and disorder," a spokeswoman for the Metropolitan Police told BBC News. "At the end of the day, you've got to say that certain events attract more trouble than others. We're shifting the focus away from live music. Originally the definition of what Form 696 applied to was extremely broad so by narrowing it down, it's thought that we can better tailor it to our requirements."

By "narrowing it down", what she's ignoring was the big controversy in the original version. The original also wanted details of the ethnic groups likely to attend along with the musical styles performed. That was, naturally, branded racist and was tossed out of the final version. According to one club owner: "Reading between the lines, the indie kids are all right but we've got to look out for those black boys with microphones in their hands," he said. "Saying it's over recorded music with DJs and MCs really narrows it down."

Most promoters, performers and venue owners were responsible, he said, but added that "Form 696 was not effective at cracking down on those causing problems: "I'm keen for the dodgy promoters who get a bad crowd and therefore create this impression of evil urban music to be found out because that's the only way we're going to clean things up. Unless we keep our own house in order, we're all going to get tarred with that brush… If Form 696 was effectively closing down parties that had trouble, then I'd be more supportive of it. I'll fill it in when asked to but I don't think it's doing what it set out to."

The police, on defense regarding this measure have responded to critics by pointing out a reduction of serious violence by 11% in licensed clubs in 2008.

This is interesting. It could also be an indication of what could happen here if anyone ever got the idea, but unlikely since overall violence is down here in the States. Personally, I'm mixed about this. On one hand if the police have an indication that a gathering of people is likely to break out in violence, then they need to do their job and try to protect people. Protecting people's rights is the job of police, after all. Well, the proper job, but I don't work in that zone so I'll drop it (They don't like the smell of explosives over there). So the police should keep there eyes out for trouble, but just declaring (in a back handed way) a particular genre of music violent is also wrong. Sure, they didn't say it now, but the fact they tried to link it to ethnic group's means this has profiling all over it. That makes my bullshit meter go off.

This is a tough one. I think the police have the right idea, but they're going about this the wrong way. It's a tough call because they'll have their asses in a sling if violence does go up and they didn't do something about it. I just don't like the idea behind it or the trend.

What do you guys think?

Garage Days Revisited

Garage Inc.

There has been a large shift away from profession studios for recording music to the use of home studios. Inexpensive software is being sited in a new report highlighting the closing (or selling of) professional studios. Industry experts estimate that up to half of the commercial studios in the L.A. area have closed or been sold to artists for private use. Damn. With the advent of software that allows high-end recording from a personal computer, commercial results are now at the tip of anyone's fingers from home, or even the iconic garage!

Although nobody officially tracks the number of recording studios in use before, the consensus among industry experts is that the big commercial facilities have taken a major hit. A key reason is that recording software emulates what old studio consoles and tape recorders used to do for a fraction of the price. Among the most widely used programs are ProTools, Cubase, and GarageBand.

Just plug it into the computer, upload the software when necessary, and away you go!

Another thing, and this was not in the report but just my one man highly biased opinion, is that the mix of free distribution and access on the internet, combined with the fact the big labels wouldn't know quality if they snorted it, has encouraged people to go DIY. I mean why play with the RIAA and the big labels, especially when they may try and force a style on you (everyone wave to Kelly Clarkson). If you want to be a musician likely you want to be a specific kind of musician and why fuck with the suits when you can just do it yourself and get what you want. I firmly believe more people are like Radiohead and not Madonna, and that is why they want to play music. It's natural that trends would reflect that.

Evidently, in large cities like LA that house a significant engineer market for recording studios, many of those guys make money now by consulting or contracting out to people's homes. Said one engineer on why they also contract out to independents: "Going from the analog age to the digital age, going from one song to another on tape used to take 30 minutes, but with ProTools software it takes about a minute… So we just lost 28, 29 minutes of time we could bill a client. So you add that up over a year and tell me how much it is."

There is a real alarm in the recording end of the business that this could be a permanent trend. Big studios cost millions of dollars and even the most technically outfitted home studio "only' cost up to $20,000. Most run cheaper, and that is a huge difference in overhead. Imagine who can offer the cheaper prices to new bands now days that want help recording their first demo?

About the only thing really going for the professional studio is the resources to produce quality. Be it personal, money, or access to key technologies that insure consistency. Add in the fact these places are designed for sound quality, microphone spacing, and control, the big set ups are still the way to go.

But still if you can't afford it or don't mind the Indy feel then home studios are the way to go. I'm sure the quality issues will become a non issue as software companies find ways to keep up with the new demand, and from I see the only demand is from the new breed on independent home studios!

He's His Own Cover Story!

Perez Hilton, the celebrity wannabe who is the delight and bane of internet folk everywhere, is having serious trouble with his music tour. Evidently I don't visit his site enough because I didn't even know he was attempting a music tour. But he did and got a few musicians like Little Boots and Ladyhawke for a tour that he billed as "huge". Hilton really wants to be part of the celebrity biz he loves to dish on and this was his stab at a legitimate business venture. He also wanted to be treated as a credible music promoter as well.

Only problem was out here is the real world we really don't give a shit. Evidently the tour has not only had problems selling tickets but the prices have been slashed down to practically nothing just to save face. According to one reporter on site, and I'm sure she'll be getting slaged soon by Hilton's gossip T&A site for this, commented: "He trumpets things like click-throughs to artists he mentions on his site, but the moment the users have to make any commitment or lay out any money, any ‘influence' he has evaporates."

In other words, the guy tries to buy favorable exposure on his site from celebrities.

This is called just deserts folks. The man spends his time pretending to be important by gossiping people on his website, then when he gets out and tries to peddle his supposed influence the real world shows him the door.

In short…

Michael Jackson's Estate






And that is the final word for October 18, 2009.