Are the new digital music business models already broken beyond repair?
Copyright , Internet / April 2009

COPYRIGHT Internet At the beginning of April an almighty row broke out between Google owned YouTube and the UK’s PRS for Music which was escalated after the online site took down all “premium” music videos saying that it had been unable to reach a rights deal with the main songwriters’ collection society. Youtube said the PRS, who represent British songwriters and music publishers, was asking it to pay “many, many times” more than the previous licensing agreement that has expired. “The costs are simply prohibitive for us – under PRS’s proposed terms, we would lose significant amounts of money with every playback,” the company said in a blog on Monday saying that the move was a “painful decision” as they argue that potential advertising revenues would never be enough to pay PRS’s proposed rate. PRS argue that YouTube are using the licence renewal to try and pay less money, while adding that they are basing their royalty demands on rates set by the UK Copyright Tribunal on digital royalties.  The move is the latest sign of the tension between YouTube and the music industry as both sides try to develop workable business models for the digital age – but also…

US Radio royalty rate row rumbles on
Copyright , Record Labels / April 2009

COPYRIGHT Record labels, radio Traditionally US radio stations, unlike their European counterparts, haven’t had to pay the owners of sound recordings (usually record companies) to play recorded music, arguing that the exposure on radio benefits the recording artists and record labels by stimulating record sales. But moves are afoot to introduce a statutory royalty and Smashing Pumpkins front man Billy Corgan made a rare public appearance in his rock-star-goes-to-Washington suit and tie to face questions by the House Judiciary Committee on Capitol Hill where Corgan spoke out in favor of a bill that would require broadcasters to compensate performers for radio airplay of their songs saying that it was simply unfair that artists, and their labels, received nothing from radio stations which had built their entire businesses around music the labels and artists had, respectively, funded and created adding saying: “I was able to find an audience, in no small measure, because of the long support of my music by terrestrial radio. I am a big fan of radio, and am very interested in its continued health and well being. Terrestrial radio has helped me to discover many of the artists that became influential to my life and artistic pursuits….

Are Universal being shady on digital royalties?
Artists , Contract , Record Labels / April 2009

CONTRACT Artists, record labels By Cassandra Williams, postgraduate student at the College of Law There is currently a battle being fought over the rate of royalties an artist should receive for online sales.    A Los Angeles jury said the record company doesn’t have to pay producers more for songs sold online, upholding the music industry’s business model.  This decision prevents an upheaval of the music industry that would have greatly changed the financial relationship between labels and artists. Mark and Jeff Bass, brothers who own F.B.T. Productions, involved in the rapper’s early works, including his 1999 Grammy-winning album, “The Slim Shady LP,” sued Universal Music Group’s Interscope Records, accusing the music label of underpaying them on royalty payments for music downloads and mobile ring tones. The FBT v Universal case centres on the level of digital royalties that are due to artists and their collaborators. Record companies treat digital sales like physical sales, and pay artists a cut of revenue as a royalty – 12% in this case. FBT argued that digital sales are more similar to licensing deals where record companies licence the use of their recordings rather than selling actual copies. The Bass brothers, said their contract entitled…

French piracy bill accused of ‘Big Brother’ policies
Copyright , Internet / April 2009

COPYRIGHT Internet The French government has been accused of “Big Brother” tactics over an anti-piracy bill which aims to punish people who repeatedly illegally download music and films by cutting off their internet access for up to a year. The proposed law, championed by President Nicolas Sarkozy, will be debated in parliament this week, will create a new state surveillance agency to monitor internet users online. Web surfers illegally downloading music, films or video games will be identified and they will first receive an email warning, then a registered letter, and if caught again they will see their web access cut off for up to a year. The culture minister, Christine Albanel, has argued that France is “the world number one” in illegal downloading. In 2006, an estimated 1bn pirated files were shared in France. A recent poll found 57% of 18-24 year-olds admitted they had made illegal downloads and one in three French internet users admitted to online piracy. Although the senate has passed the bill, a heated row over civil liberties is expected as parliament debates the law this week. Christian Paul, a Socialist MP leading opposition to the law, said it would create a precedent for “massive…

Canada looks at the legality of torrent sites
Copyright , Internet / April 2009

COPYRIGHT Internet As the Swedish courts consider the Pirate Bay case a judge in British Columbia has refused to rule in favour of a major BitTorrent tracker without a full trial to consider the legalities of what the service does after the owner of one of the most popular Torrent indexing services, isoHunt, which provides links to over 1.5 million BitTorrent sources of content, much of it unlicensed, went to court himself to ask for a ruling that his operation did not contravene the country’s copyright laws. Such a ruling would, of course, stop the record companies from taking action against him, and would presumably help him raise investment and sell advertising. The defence raised in Sweden was that a BitTorrent site hosts no illegal content itself, only potentially linking to illegal (and legal) content. The British Columbia Supreme Court Judge Victor Curtis has not ruled that Fung is acting illegally, but refused to provide the declaration the Torrent man requested, saying a full trial would be required to assess the legal status of isoHunt. Judge Curtis also raised some concerns regarding the service, comparing isoHunt to a gun seller saying that Fung, like a gun dealer, isn’t liable whenever…

Disappointed Miley Cyrus fanclub members win lawsuit
Artists , Contract / April 2009

CONTRACT Artists Miley Cyrus’ fanclub has been ordered to extend the memberships of 700 Pennsylvanian fans free of charge as part of a settlement relating to complaints that they were not given promised priority access to tickets for a sold out show in Pittsburgh in January 2008, despite possibly being led to believe they would be. Nashville-based Interactive Marketing will also have to pay a $20,000 fine and put a notice on the fanclub’s website explaining that paying for membership does not guarantee early access to tickets. Although it agreed to the settlement, the company maintains that it did nothing wrong. CMU Daily

Reznor has his say on ticketing (as does almost everyone at the ILMC)
Artists , Live Events / April 2009

TICKETING Artists, live music industry The secondary ticket market (or scalping, or dynamic pricing, “lateness tax” or whatever you want to call it, basically the re-sale of tickets at marked up prices by one method or another) was much discussed at ILMC (see our news pages from the ILMC) and one on which Trent Reznor has had a lot to say too writting a long rant on the issue making some very interesting claims about how some promoters, managers and maybe even artists are using the secondary market themselves so they can make more money from ticket sales without being seen to hike up prices too much with Reznor sayiong “The ticketing marketplace for rock concerts shows a real lack of sophistication, meaning this: the true market value of some tickets for some concerts is much higher than what the act wants to be perceived as charging”. Because artists don’t want to come across as “greedy pricks” by charging higher prices, he claims, “the venue, the promoter, the ticketing agency and often the artist camp (artist, management and agent) take tickets from the pool of available seats and feed them directly to the re-seller … there is money to be…

Guns n Roses uploader could get six moths jail
Copyright , Record Labels / April 2009

COPYRIGHT Record labels Kevin Cogill, who leaked Guns N Roses’ ‘Chinese Democracy’ onto the internet ahead of its release last year, could get a six month jail term if the FBI get their way. Wired magazine report that federal prosecutors want Kevin Cogill to get a six month prison sentence with prosecutor Craig Missakian saying “Making a pre-release work available to the worldwide public over the internet where it can be copied without limit is arguably one of the more insidious forms of copyright infringement”. Cogill could also face a $371,622 fine. Sentencing is set for May 4th.

Lily gets pap protection
Artists , Privacy / April 2009

PRIVACY Artists Legal firm Carter-Ruck have been awarded two injunctions from the High Court under the Protection From Harassment Act in a bid to stop the paparazzi from following Lily Allen following an incident when one photographers’s car collided with Lily’s own car as she left her London home. The injunction orders two photo agencies, Big Pictures and Matrix Photos, and one specific photographer to make undertakings in court to not harass Allen in the future. Mr Justice Eady also issued an injunction “restraining further harassment” by other paparazzi photographers meaning that anyone considered a paparazzi cannot approach Allen within 100 metres of her home, photograph her at her home or the houses of her family and friends, or pursue her by road.

AEG may have to ‘self insure’ Jackson dates
Contract , Live Events / April 2009

CONTRACT Live music Industy The insurance industry is taking a pragmatic view of Michael Jackson’s 50 date sell out run at London’s O2 (which may be extended) with a near universal reluctance to insure against cancellation and the £300 million resultant bill from a full cancellation. The Daily Telegraph quote AEG chief Randy Phillips as saying: “We would be prepared to self-insure to make up the dates. It’s a risk we’re willing to take to bring the King of Pop to his fans”.

Crosstown Music Company v Rive Droite Music Ltd and others [2009] EWHC 600 (Ch)
Copyright , Music Publishing / April 2009

COPYRIGHT Music Publishing From the IP Kat “Here’s a tricky case”:  A couple of songwriters assign their copyrights to a company that is obliged to exploit those copyrights commercially.  The deal contains a clause that enables the songwriters to get their copyright back if the company is in material breach of its obligations.  The company then assigns the copyrights to another company, following which the songwriters want their copyright back. Do they get it? Yes, according to Crosstown Music Company v Rive Droite Music Ltd and others, a decision of Mr Justice Mann (Chancery Division, England and Wales) on Wednesday, Crosstown took an assignment of 119 copyrights owned by Rive Droite. Some of those copyrights related to songs written by Taylor and Barry, who assigned the copyright in their compositions to Rive Droite so that the latter could exploit the copyright and pay them royalties under an agreement which provided (in clause 18(a)) that, if Rive Droite were to be in material breach of its terms and failed to take all reasonable action to remedy that breach within 45 (in Taylor’s case) or 60 (in Barry’s case) days of written notification of a ‘cure notice’, the assigned copyright would revert to…

Exotic dancers fees are dramatic performances for tax purposes
Artists , Licensing , Taxation / April 2009

LICENSING / TAXATION Artists ARTICLE LINK:  A US judge has held that pole dancing does constitute a dramatic or artistic performance and thus cover charges imposed by an Albany-area strip club are not subject to state sales taxes. Administrative Law Judge Catherine M. Bennett determined that Nite Moves in Latham, N.Y., qualifies for the “dramatic arts” sales tax exemption under state Tax law 1105(f)(1) after reviewing DVDs of exotic dancers, including material taken from the Internet site, and hearing testimony from a University of Maryland dance scholar. The article in full can be found at