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Entries in Music Industry (80)
Just a few years ago the headlines in the music business trades were touting the story that Prince had returned to Warner Brothers Records after 18 years with a revolutionary new deal that would see him regain ownership of his back catalog of recordings. As with all things Prince, it was cutting edge. This Prince/Warner Brothers deal marked a new era as the ability to terminate master recording copyright after 35 years was granted in the Copyright Revision Act of 1976 and became effective in 1978, the year that Prince’s debut album came out.
It seems that just as the record business has been staggering back to its feet after the digital assault started by Napster over a decade ago, another hard blow to the record industry business model is starting to have ripple effects. Recording artists and songwriters from 1978 and after are now entitled to start terminating their contractual transfers and demanding back their copyrights. The 1976 Copyright Act, in a provision that has generally been overlooked until now, provides for the termination of copyright transfers. Even if an artist or songwriter signed a contract with a record company or music publisher that purports to transfer all rights in a work in perpetuity, the Copyright Act provides that the author can terminate that grant and demand that the rights revert to the author in a shorter period of time. This is a great opportunity for artists and songwriters to get a second bite at the apple, so to speak, and get a better share of the income earned from their creative works.
Prince was on top of his game. Generally speaking, for copyright grants made on or after January 1, 1978 (the effective date of the 1976 Copyright Act) the termination period is 35 years under Section 203 of the Copyright Act. For pre-1978 works the termination period is 56 years after copyright was originally secured under Section 304. For grants on or after 1978, termination may be exercised anytime during a 5 year period beginning at the end of 35 years from the execution of the grant or, if the grant concerns the right of publication of the work, then the period begins on the sooner of 35 years after publication or 40 years after execution of the grant. Although there are certain formalities which must be complied with to effectuate transfer, this essentially means that recording artists and songwriters can start exercising their right of termination as soon as 2013 – which may effectively decimate many record company and music publishing catalogs.
Back when the 1976 Copyright Act was drafted few could envision a world where the artists might not need the record companies to finance, manufacture, promote, store and distribute their records. Back then the expectation was that, although any particular artist could exercise the termination right, what would effectively happen is that the label and artist would simply be forced to renegotiate a deal to continue working together. Now in the digital age, however, this is no longer true. Any artist can demand back their masters and then simply offer them on their own website or license the rights to an online aggregator with little or no expense. This is particularly true in the case of catalog recordings since the artist would not even need the record company to finance the recording costs. The more digital the music business becomes the more obsolete the large record labels become for established artists. High profile artists with already established fan bases and large catalogs such as Prince, Blondie, the Cars, Bruce Springsteen and others probably have no need for much in the way of advertising and marketing of their recordings, and certainly no need for manufacturing, distributing or warehousing of the product. Simple ownership and possession of the digitized masters would be sufficient.
There is one scenario that does bode well for record companies in that it may steer even established artists to follow the renegotiation route as Prince has done. Those familiar with record contracts know that, unlike song publishing contracts which generally provide for the assignment and transfer of a song copyright to the publisher, most record contracts provide that the sound recording is created as a “work for hire” for the record label. Under the 1976 Copyright Act the termination provision is not applicable to a genuine work for hire grant. However, this does not preclude recording artists from exercising their right of termination. Just a few years ago I litigated a case where the Court held that a sound recording does not qualify as a work for hire. Without getting into all the applicable legal employer/employee issues involved, there is a great deal of case law which addresses the subject of “work for hire” and holds that whether a work created by an employee is a work for hire or not depends on various factors other than just the language of the contract. This area of law is ripe for litigation by recording artists who want to exercise their termination rights where the facts suggest that no genuine work for hire relationship ever existed. Although the landmark case has yet to be fought, from what I have seen it appears that in most cases the artist would prevail over the record company on this point. However, artist like Prince as well as label executives have also realized that the wiser course may be to negotiate the reversions and retain control of issuing artists’ catalog eligible for copyright terminations.
The termination rights of an artist or songwriter are generally subject to a 5 year window. Termination must be made effective within the termination window or the right to terminate the grant is forfeited. To be effective, the artist or songwriter must serve a written notice of termination on the original record company or publisher (or its successor) no more than 10 and no less than 2 years prior to the effective date stated in the notice. The notice of termination must state the effective date of termination. Perfection of the termination requires that a copy of the written notice also be filed with the U.S. Copyright Office prior to the effective date of termination
Although the termination rights of an artist under the 1976 Copyright Act would only be effective for the U.S. territory, the size of the U.S. consumer market for recorded music still makes this a valuable right to reclaim. However, what is good for the artist might further erode the influence of the major record labels and prove detrimental to the industry in the future, so labels would be well advised to start planning for the onslaught and try to forge deals like Prince has done with Warner Brothers.
Wallace Collins is a New York lawyer specializing in entertainment, copyright, trademark and internet law. He was a recording artist for Epic Records before attending Fordham LawSchool. T:(212) 661-3656 / www.wallacecollins.com
The perceived value of recorded music is free, and always has been! When we pay for music in any format, what are we actually buying?
We’ve all seen the ads, spam comments from random accounts, and posts that look oh so tempting to check out or even try. Increase your followers!, Gain more followers! Blah! Blah! Blah!…but of course it comes with a cost…literally. Now, we can’t discredit the supply/demand business savvy that is being used here. These fly by night business pages/companies are aware that people are now desperate to get their follower numbers up. With this in mind, they’ve set up a way to manipulate the social media numbers to create the illusion of a large following. It’s smart, in a way, because when one person sees that an artist has a large number of followers on their page, they tend to check it out to see what the hype is all about. However, at the end of the day, the numbers just don’t add up.
As an up and coming artist it’s hard to break out and get recognized in the music industry, let alone reach big enough audiences to earn a good living but when push comes to shove, if you have no marketing budget, you have to find another way.
Atlanta, GA – August 18, 2015 - BRASH! – A Music Marketing Blog began in August of 2011 with the notion of providing new/independent artists with music marketing knowledge to help advance their careers.. Since its beginnings, BRASH! has made a grand name for itself by sticking to its original notion along with giving independent artists exposure and displaying how the music industry is gaining innovation. Now celebrating its fourth year, BRASH! is looking to gain more ground to reach a broader audience, provide more content, and fulfill the vision of music marketing in the Indie music industry. “I remember sitting in an office cubicle writing blogs for this corporate company that I had no interest in. Then, I got the idea of writing my own, I wanted it to be helpful, I wanted it to be about music & entertainment, and I wanted it to be BRASH!” says founder/editor-in-chief E. Alexcina Brown. “My goal was to provide an outlet for great artists who were not fortunate enough to have that mainstream exposure.”
BELOW IS AN EXCERPT FROM http://www.latimes.com/entertainment/music/la-ca-ms-motley-crue-20150809-story.html#page=1
“Mötley Crüe’s longtime manager, Allen Kovac, sees Led Zeppelin, which disbanded in 1980 after the death of drummer John Bonham, as the ideal precedent. “No one has left more money on the table than Zeppelin, and yet they have one of the highest-selling catalogs and merchandising lines in the world because they didn’t go out and diminish the brand like so many bands have,” Kovac says. “Mötley Crüe recognized that part of the puzzle.”
Perhaps Kovac has a point about branding? Cut to… http://www.rollingstone.com/music/news/on-the-charts-led-zeppelins-in-through-the-out-door-back-in-top-10-20150809
Why Taylor Swift is wrong about online music
Where can we find quality music today?
It’s a no-brainer that the music industry has DRASTICALLY changed since some of our favorite mainstream artists began. These changes have created a domino effect on how music is made, distributed, marketed, and handled business wise. A lot of our beloved artists who were once signed to major labels have now started their own or joined independent labels. On the other hand, technology changes have had a grand effect on new indie artists who have hopes on getting picked up/signed by major labels OR continue their growth on the independent route
Billy Corgan, Smashing Pumpkins frontman, believes that the music business model is outdated and takes advantage of artists. Corgan said, “The music business is mostly run by feckless idiots who do not subscribe to the normal tenets of capitalism which when they do, the business tends to work out well and stars tend to rise to the top, everybody benefits, but it is still a parochial business. It is run by thiefdoms way behind the times technologically.”
In our last blog about Music & Fashion, we highlighted how these two elements can come together to make a powerful force in the entertainment and fashion industries. You can take that on and allow yourself as an indie artist to be a part of that force. Today, music artists are setting the latest fashion trends. Consumers are being inspired by what today’s hottest artists are wearing on red carpets, interviews, appearances, concerts, and even on their social media during random outings. Some wardrobe choices are only meant for the stage however, fans are constantly wondering, “What are they wearing? How can I get it?” This blog can go for up & coming fashion moguls as well. You want your clothes to have more exposure in your industry, team up with a great artist to help build that brand. Gain their fans as future customers.