Courtney Sounds The Alarm...
> This is the most cogent and lucid speech I have read in a long >time. Courtney Love describes the corruption, loss of freedom and >ownership, and secret laws being passed every day in the organized crime >dominated world of music and the Internet. > >Please read it all as we all have a responsibility to ourselves and others >to improve the world and our lives. I know it's long, but take the time, >it's worth it. The end is the best part. Without further ado. . . > >-=-=-=-=-=- > >Today I want to talk about piracy and music. What is piracy? Piracy is the >act of stealing an artist's work without any intention of paying for it. I'm >not talking about Napster-type software. > >I'm talking about major label recording contracts. > >I want to start with a story about rock bands and record companies, and do >some recording-contract math: > >This story is about a bidding-war band that gets a huge deal with a 20 >percent royalty rate and a million-dollar advance. (No bidding-war band ever >got a 20 percent royalty, but whatever.) This is my "funny" math based on >some reality and I just want to qualify it by saying I'm positive it's >better math than what Edgar Bronfman Jr. [the president and CEO of Seagram, >which owns Polygram] would provide. > >What happens to that million dollars? > >They spend half a million to record their album. That leaves the band with >$500,000. They pay $100,000 to their manager for 20 percent commission. They >pay $25,000 each to their lawyer and business manager. > >That leaves $350,000 for the four band members to split. After $170,000 in >taxes, there's $180,000 left. That comes out to $45,000 per person. > >That's $45,000 to live on for a year until the record gets released. > >The record is a big hit and sells a million copies. (How a bidding-war band >sells a million copies of its debut record is another rant entirely, but >it's based on any basic civics-class knowledge that any of us have about >cartels. Put simply, the antitrust laws in this country are basically a >joke, protecting us just enough to not have to re-name our park service the >Phillip Morris National Park Service.) > >So, this band releases two singles and makes two videos. The two videos cost >a million dollars to make and 50 percent of the video production costs are >recouped out of the band's royalties. > >The band gets $200,000 in tour support, which is 100 percent recoupable. > >The record company spends $300,000 on independent radio promotion. You have >to pay independent promotion to get your song on the radio; independent >promotion is a system where the record companies use middlemen so they can >pretend not to know that radio stations -- the unified broadcast system -- >are getting paid to play their records. > >All of those independent promotion costs are charged to the band. > >Since the original million-dollar advance is also recoupable, the band owes >$2 million to the record company. > >If all of the million records are sold at full price with no discounts or >record clubs, the band earns $2 million in royalties, since their 20 percent >royalty works out to $2 a record. > >Two million dollars in royalties minus $2 million in recoupable expenses >equals ... zero! > >How much does the record company make? > >They grossed $11 million. > >It costs $500,000 to manufacture the CDs and they advanced the band $1 >million. Plus there were $1 million in video costs, $300,000 in radio >promotion and $200,000 in tour support. > >The company also paid $750,000 in music publishing royalties. > >They spent $2.2 million on marketing. That's mostly retail advertising, but >marketing also pays for those huge posters of Marilyn Manson in Times Square >and the street scouts who drive around in vans handing out black Korn >T-shirts and backwards baseball caps. Not to mention trips to Scores and >cash for tips for all and sundry. > >Add it up and the record company has spent about $4.4 million. > >So their profit is $6.6 million; the band may as well be working at a >7-Eleven. > >Of course, they had fun. Hearing yourself on the radio, selling records, >getting new fans and being on TV is great, but now the band doesn't have >enough money to pay the rent and nobody has any credit. > >Worst of all, after all this, the band owns none of its work ... they can >pay the mortgage forever but they'll never own the house. Like I said: >Sharecropping. Our media says, "Boo hoo, poor pop stars, they had a nice >ride. Fuck them for speaking up"; but I say this dialogue is imperative. And >cynical media people, who are more fascinated with celebrity than most >celebrities, need to reacquaint themselves with their value systems. > >When you look at the legal line on a CD, it says copyright 1976 Atlantic >Records or copyright 1996 RCA Records. When you look at a book, though, >it'll say something like copyright 1999 Susan Faludi, or David Foster >Wallace. Authors own their books and license them to publishers. When the >contract runs out, writers gets their books back. But record companies own >our copyrights forever. > >The system's set up so almost nobody gets paid. > >Recording Industry Association of America (RIAA) > >Last November, a Congressional aide named Mitch Glazier, with the support of >the RIAA, added a "technical amendment" to a bill that defined recorded >music as "works for hire" under the 1978 Copyright Act. > >He did this after all the hearings on the bill were over. By the time >artists found out about the change, it was too late. The bill was on its way >to the White House for the president's signature. > >That subtle change in copyright law will add billions of dollars to record >company bank accounts over the next few years -- billions of dollars that >rightfully should have been paid to artists. A "work for hire" is now owned >in perpetuity by the record company. > >Under the 1978 Copyright Act, artists could reclaim the copyrights on their >work after 35 years. If you wrote and recorded "Everybody Hurts," you at >least got it back to as a family legacy after 35 years. But now, because of >this corrupt little pisher, "Everybody Hurts" never gets returned to your >family, and can now be sold to the highest bidder. > >Over the years record companies have tried to put "work for hire" provisions >in their contracts, and Mr. Glazier claims that the "work for hire" only >"codified" a standard industry practice. But copyright laws didn't identify >sound recordings as being eligible to be called "works for hire," so those >contracts didn't mean anything. Until now. > >Writing and recording "Hey Jude" is now the same thing as writing an English >textbook, writing standardized tests, translating a novel from one language >to another or making a map. These are the types of things addressed in the >"work for hire" act. And writing a standardized test is a work for hire. Not >making a record. > >So an assistant substantially altered a major law when he only had the >authority to make spelling corrections. That's not what I learned about how >government works in my high school civics class. > >Three months later, the RIAA hired Mr. Glazier to become its top lobbyist at >a salary that was obviously much greater than the one he had as the spelling >corrector guy. > >The RIAA tries to argue that this change was necessary because of a >provision in the bill that musicians supported. That provision prevents >anyone from registering a famous person's name as a Web address without that >person's permission. That's great. I own my name, and should be able to do >what I want with my name. > >But the bill also created an exception that allows a company to take a >person's name for a Web address if they create a work for hire. Which means >a record company would be allowed to own your Web site when you record your >"work for hire" album. Like I said: Sharecropping. > >Although I've never met any one at a record company who "believed in the >Internet," they've all been trying to cover their asses by securing >everyone's digital rights. Not that they know what to do with them. Go to a >major label-owned band site. Give me a dollar for every time you see an >annoying "under construction" sign. I used to pester Geffen (when it was a >label) to do a better job. I was totally ignored for two years, until I got >my band name back. The Goo Goo Dolls are struggling to gain control of their >domain name from Warner Bros., who claim they own the name because they set >up a shitty promotional Web site for the band. > >Orrin Hatch, songwriter and Republican senator from Utah, seems to be the >only person in Washington with a progressive view of copyright law. One >lobbyist says that there's no one in the House with a similar view and that >"this would have never happened if Sonny Bono was still alive." > >By the way, which bill do you think the recording industry used for this >amendment? > >The Record Company Redefinition Act? No. The Music Copyright Act? No. The >Work for Hire Authorship Act? No. > >How about the Satellite Home Viewing Act of 1999? > >Stealing our copyright reversions in the dead of night while no one was >looking, and with no hearings held, is piracy. > >It's piracy when the RIAA lobbies to change the bankruptcy law to make it >more difficult for musicians to declare bankruptcy. Some musicians have >declared bankruptcy to free themselves from truly evil contracts. TLC >declared bankruptcy after they received less than 2 percent of the $175 >million earned by their CD sales. That was about 40 times less than the >profit that was divided among their management, production and record >companies. > >Toni Braxton also declared bankruptcy in 1998. She sold $188 million worth >of CDs, but she was broke because of a terrible recording contract that paid >her less than 35 cents per album. Bankruptcy can be an artist's only defense >against a truly horrible deal and the RIAA wants to take it away. > >Artists want to believe that we can make lots of money if we're successful. >But there are hundreds of stories about artists in their 60s and 70s who are >broke because they never made a dime from their hit records. And real >success is still a long shot for a new artist today. Of the 32,000 new >releases each year, only 250 sell more than 10,000 copies. And less than 30 >go platinum. > >The four major record corporations fund the RIAA. These companies are rich >and obviously well-represented. Recording artists and musicians don't really >have the money to compete. The 273,000 working musicians in America make >about $30,000 a year. Only 15 percent of American Federation of Musicians >members work steadily in music. > >But the music industry is a $40 billion-a-year business. One-third of that >revenue comes from the United States. The annual sales of cassettes, CDs and >video are larger than the gross national product of 80 countries. Americans >have more CD players, radios and VCRs than we have bathtubs. > >Story after story gets told about artists -- some of them in their 60s and >70s, some of them authors of huge successful songs that we all enjoy, use >and sing -- living in total poverty, never having been paid anything. Not >even having access to a union or to basic health care. Artists who have >generated billions of dollars for an industry die broke and un-cared for. > >And they're not actors or participators. They're the rightful owners, >originators and performers of original compositions. > >This is piracy. > >Technology is not piracy > >This opinion is one I really haven't formed yet, so as I speak about Napster >now, please understand that I'm not totally informed. I will be the first in >line to file a class action suit to protect my copyrights if Napster or even >the far more advanced Gnutella doesn't work with us to protect us. I'm on >[Metallica drummer] Lars Ulrich's side, in other words, and I feel really >badly for him that he doesn't know how to condense his case down to a >sound-bite that sounds more reasonable than the one I saw today. > >I also think Metallica is being given too much grief. It's anti-artist, for >one thing. An artist speaks up and the artist gets squashed: Sharecropping. >Don't get above your station, kid. It's not piracy when kids swap music over >the Internet using Napster or Gnutella or Freenet or iMesh or beaming their >CDs into a My.MP3.com or MyPlay.com music locker. It's piracy when those >guys that run those companies make side deals with the cartel lawyers and >label heads so that they can be "the labels' friend," and not the artists'. > >Recording artists have essentially been giving their music away for free >under the old system, so new technology that exposes our music to a larger >audience can only be a good thing. Why aren't these companies working with >us to create some peace? > >There were a billion music downloads last year, but music sales are up. >Where's the evidence that downloads hurt business? Downloads are creating >more demand. > >Why aren't record companies embracing this great opportunity? Why aren't >they trying to talk to the kids passing compilations around to learn what >they like? Why is the RIAA suing the companies that are stimulating this new >demand? What's the point of going after people swapping cruddy-sounding >MP3s? Cash! Cash they have no intention of passing onto us, the writers of >their profits. > >At this point the "record collector" geniuses who use Napster don't have the >coolest most arcane selection anyway, unless you're into techno. Hardly any >pre-1982 REM fans, no '60s punk, even the Alan Parsons Project was >underrepresented when I tried to find some Napster buddies. For the most >part, it was college boy rawk without a lot of imagination. Maybe that's the >demographic that cares -- and in that case, My Bloody Valentine and Bert >Jansch aren't going to get screwed just yet. There's still time to >negotiate. > >Destroying traditional access > >Somewhere along the way, record companies figured out that it's a lot more >profitable to control the distribution system than it is to nurture artists. >And since the companies didn't have any real competition, artists had no >other place to go. Record companies controlled the promotion and marketing; >only they had the ability to get lots of radio play, and get records into >all the big chain store. That power put them above both the artists and the >audience. They own the plantation. > >Being the gatekeeper was the most profitable place to be, but now we're in a >world half without gates. The Internet allows artists to communicate >directly with their audiences; we don't have to depend solely on an >inefficient system where the record company promotes our records to radio, >press or retail and then sits back and hopes fans find out about our music. > >Record companies don't understand the intimacy between artists and their >fans. They put records on the radio and buy some advertising and hope for >the best. Digital distribution gives everyone worldwide, instant access to >music. > >And filters are replacing gatekeepers. In a world where we can get anything >we want, whenever we want it, how does a company create value? By filtering. >In a world without friction, the only friction people value is editing. A >filter is valuable when it understands the needs of both artists and the >public. New companies should be conduits between musicians and their fans. > >Right now the only way you can get music is by shelling out $17. In a world >where music costs a nickel, an artist can "sell" 100 million copies instead >of just a million. > >The present system keeps artists from finding an audience because it has too >many artificial scarcities: limited radio promotion, limited bin space in >stores and a limited number of spots on the record company roster. > >The digital world has no scarcities. There are countless ways to reach an >audience. Radio is no longer the only place to hear a new song. And tiny >mall record stores aren't the only place to buy a new CD. > >I'm leaving > >Now artists have options. We don't have to work with major labels anymore, >because the digital economy is creating new ways to distribute and market >music. And the free ones amongst us aren't going to. That means the slave >class, which I represent, has to find ways to get out of our deals. This >didn't really matter before, and that's why we all stayed. > >I want my seven-year contract law California labor code case to mean >something to other artists. (Universal Records sues me because I leave >because my employment is up, but they say a recording contract is not a >personal contract; because the recording industry -- who, we have >established, are excellent lobbyists, getting, as they did, a clerk to >disallow Don Henley or Tom Petty the right to give their copyrights to their >families -- in California, in 1987, lobbied to pass an amendment that >nullified recording contracts as personal contracts, sort of. Maybe. Kind >of. A little bit. And again, in the dead of night, succeeded.) > >That's why I'm willing to do it with a sword in my teeth. I expect I'll be >ignored or ostracized following this lawsuit. I expect that the treatment >you're seeing Lars Ulrich get now will quadruple for me. Cool. At least I'll >serve a purpose. I'm an artist and a good artist, I think, but I'm not that >artist that has to play all the time, and thus has to get fucked. Maybe my >laziness and self-destructive streak will finally pay off and serve a >community desperately in need of it. They can't torture me like they could >Lucinda Williams. > >You funny dot-communists. Get your shit together, you annoying sucka VCs > >I want to work with people who believe in music and art and passion. And I'm >just the tip of the iceberg. I'm leaving the major label system and there >are hundreds of artists who are going to follow me. There's an unbelievable >opportunity for new companies that dare to get it right. > >How can anyone defend the current system when it fails to deliver music to >so many potential fans? That only expects of itself a "5 percent success >rate" a year? The status quo gives us a boring culture. In a society of over >300 million people, only 30 new artists a year sell a million records. By >any measure, that's a huge failure. > >Maybe each fan will spend less money, but maybe each artist will have a >better chance of making a living. Maybe our culture will get more >interesting than the one currently owned by Time Warner. I'm not crazy. Ask >yourself, are any of you somehow connected to Time Warner media? I think >there are a lot of yeses to that and I'd have to say that in that case >president McKinley truly failed to bust any trusts. Maybe we can remedy that >now. > >Artists will make that compromise if it means we can connect with hundreds >of millions of fans instead of the hundreds of thousands that we have now. >Especially if we lose all the crap that goes with success under the current >system. I'm willing, right now, to leave half of these trappings -- fuck it, >all these trappings -- at the door to have a pure artist experience. They >cosset us with trappings to shut us up. That way when we say "sharecropper!" >you can point to my free suit and say "Shut up pop star." > >Here, take my Prada pants. Fuck it. Let us do our real jobs. And those of us >addicted to celebrity because we have nothing else to give will fade away. >And those of us addicted to celebrity because it was there will find a >better, purer way to live. > >Since I've basically been giving my music away for free under the old >system, I'm not afraid of wireless, MP3 files or any of the other threats to >my copyrights. Anything that makes my music more available to more people is >great. MP3 files sound cruddy, but a well-made album sounds great. And I >don't care what anyone says about digital recordings. At this point they are >good for dance music, but try listening to a warm guitar tone on them. They >suck for what I do.