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A Curated List Of My Thoughts On The Music Modernization Act (And Related Topics)

music-modernization-act

I am a very vocal music creators’ rights advocate and copyright purist. Often, I have the opportunity to share my *opinions* on topics within and circling the music industry that impact the ways in which music creators — especially DIY musicians — navigate and thrive in the United States.

Over the last ten months I have been especially vocal about the Music Modernization Act. I’ve been quoted in Billboard, Rolling Stone, Pitchfork and Digital Media News. I’ve been invited to panel discussions at music industry conferences and keynotes at universities. And I have written several think pieces (and rants) on the bill, which is now law, and related issues.

Still, I am asked what my thoughts are on the MMA.

I’ll summarize my thoughts by saying that I believe the intent of the MMA is good and admirable on its surface — that is, to improve the way rightsholders are accounted to and paid for the use of their music. I believe there is some good stuff in the MMA; particularly, the entirety of Title 2 (The CLASSICS Act) and Title 3 (The AMP Act). However, I feel that there is still work to be done. I also feel that some compromises, at the expense of DIY music creators, were made too easily (this is partially based on private discussions that I’ve had with individuals with privileged knowledge of the negotiations and dealings that took place during the drafting and subsequent amending of the MMA). That being said, I also believe that the soon to be formed Mechanical Licensing Collective has the opportunity to prove to songwriters that this law was truly about them.

Only time will tell.

Here’s a 2018 curated list of my “thoughts” on the Music Modernization Act (and related topics):

  • (Oct 16, 2018) Here Are 10 Ways That The Music Licensing Collective (MLC) Can Set The Bar As A Collective Licensing Organization In The 21st Century – https://bit.ly/2RW9kW2
  • (Sep 14th, 2018 in Pitchfork) Why So Many Hip-Hop Producers Are Putting Business Before Beats – https://bit.ly/2PEsi1x
  • (Aug 19th, 2018) Another Music Modernization Act Opinion Piece – https://bit.ly/2NLp9LC
  • (Aug 15th, 2018 in Rolling Stone) Why More Pop Songwriters Are Stepping Into the Spotlight – https://bit.ly/2ClAuAc
  • (Jul 24th, 2018) Songwriters Are Owed Nearly $2B In Unclaimed Royalties!!! — Maybe More — I’ve Been Saying This For Some Time Now (Against Pushback), But Finally The Press Has Confirmed It – https://bit.ly/2CMR6Sp
  • (May 15th, 2018 in Billboard) Black Box Royalties Myths, Common Misconceptions Debunked at Music Biz 2018 – https://bit.ly/2q4dhLD
  • (May 7th, 2018 in Digital Music News) Is the Music Modernization Act Enabling ‘Legal Theft’ Against Smaller Artists? – https://bit.ly/2IugrCS
  • (Apr 25th, 2018) 5 Ways The Music Modernization Act Could Be Fairer To ALL Music Creators – https://bit.ly/2Jzn1tb
  • (Apr 20th, 2018) I Was Interviewed By The Congressional Budget Office Regarding The Music Modernization Act, And Now I’m Even More Concerned For DIY Musicians – https://bit.ly/2AdwpN0
  • (Jan 17th, 2018) – My Thoughts On The MMA In Light Of The CRB Mechanical License Rate Decision – https://bit.ly/2P6bT98

Where do you stand on the MMA?

Here Are 10 Ways That The Music Licensing Collective (MLC) Can Set The Bar As A Collective Licensing Organization In The 21st Century

music licensing collective dae bogan

If you work in the music industry and own a radio, TV, smartphone, or computer then you’ve probably already heard that the The Orrin G. Hatch–Bob Goodlatte Music Modernization Act (MMA) has been signed into law. At this point, every major music rights organization has published their praise of the legislation, which will create a blanket streaming mechanical license for Spotify, Apple, Amazon, Google, Tidal, and other on-demand music streaming companies; bring pre-1972 sound recordings under federal copyright protection and open up a flow of royalties from digital services to the artists (or their estates) and copyright owners of those recordings; and codify an allocation of digital radio royalties to music producers.

Title 1 of the MMA, also called Music Modernization Act, sets out  provisions and guidance for the formation of a collective mechanical licensing body to be called the Mechanical Licensing Collective (MLC). The MLC will administer a safe harbor blanket license for the streaming of musical works, collect licensee fees from licensees, prepare and remit statements of earnings to songwriters and music publishers, and make royalty payments to the same.

The MLC will join the ranks of SoundExchange, ASCAP, BMI, and SESAC in the sense that it will become a powerful representative of the collective rights of thousands of music creators and rights-holders in the United States. However, unlike its counterparts, the MLC will be born in the 21st century. And as a 21st century collective licensing organization, the MLC has the unique opportunity to implement, at inception, 21st century business practices utilizing 21st century best practices and technologies.

Here are 10 ways that the Mechanical Licensing Collective can set the bar as a 21st century collective licensing organization:
 
1.) Provide its members with a data BI (business intelligence) dashboard to better visualize their mechanical royalties data and dive deeper into their statements. The dashboard could enable forecasting based on projected streaming activity (maybe offer scenario planning, which makes it possible to attract loans against future royalties). They could ingest data from a service like BuzzAngle to offer estimated royalty accrual in real-time so that members who are artists can see the net effect of playlist streaming campaigns on their bottom line and choose to invest more into campaigns in virtual real-time.
 
2.) Maintain a public and accessible unclaimed royalties database. Deploy artificial intelligence to evaluate unmatched usage reports as opposed to relying solely on exact name and ISWC matches. And expand the statute of limitations on unclaimed royalties to 10 years
 
3.) Require DSPs who take advantage of the safe harbor streaming mechanical license to recommend (and provide guidance) to aggregators and labels to provide composition ownership information in their metadata when uploading releases to the DSP. This can be done with custom parameters in DDEX ERN or via the new DDEX MWN (Musical Works Ownership) message schema.
 
4.) Work with the U.S. Copyright Office to create an integrated musical works registrations process so that works are simultaneously registered with the MLC and LOC.
 
5.) Expand the statute of limitation period on unclaimed royalties to 10 years and hold funds in an interest-bearing escrow account from which 25% of the interest flows to the general fund of the MLC and 75% of the interest is paid to the payee, along with the balance of unpaid royalties, once the payee has come forward or have been found.
 
6.) Commission an annual audit and publish the findings to members.
 
7.) Use blockchain, where applicable.
 
8.) Remit statements and payments monthly when a member opts to receive direct deposits and electronic statements.
 
9.) Display assessed administration fees on royalty statements.
 
10.) Do not implement high usage weights or bonuses.

How Blockchain And Cryptocurrency Can Speed Up Spotify International Publishing Royalty Payments To US Songwriters

cryptocurrency and music

There’s been a lot of talk about applications of blockchain technology and cryptocurrency payments in the music industry. In fact, there isn’t a single major music industry conference that doesn’t dedicate some programming to related topics. There are several projects and startups currently underway to address licensing, discovery, attribution, remuneration and more with blockchain, smart contracts, and cryptocurrency.

For those of us who aren’t blockchain developers, simply keeping up with the many applications of blockchain in the music industry is the closest we’ll get actually knowing how this all (could) works.

I’ve been thinking about how blockchain and cryptocurrency could speed up the process of paying U.S. songwriters, who wait upwards of 1.5 years to get paid for the use of their songs on Spotify outside the U.S.

The current state of the flow of international publishing income to U.S. Independent Songwriters who own their publishing and use traditional publishing administrators to collect in the U.S. is quite depressing.

As an example, Tommy released a song on Spotify in January 2018. In the United Kingdom, the song earned $100 “publisher share” Spotify UK digital public performance royalties.

Here’s the breakdown:

START: $100 “publisher share” of Spotify UK digital performance royalties in January 2018.

1. PRS collects Tommy’s publishing income in the UK ($100) in January 2018.

2. PRS retains 10% admin fee and remits the balance ($90) to ASCAP in October 2018.

3. ASCAP retains 12% admin fee and remits the balance ($79.20) to the Publishing Administrator in February 2019.

4. Publishing Administrator retains 20% admin fee and pays Tommy ($63.36) in July 2019.

END: Tommy is paid $63.36 for his Spotify UK “publisher share” income (earned $100) after waiting 1.5 years and experiencing a reduction of 37% of his royalties. Imagine $1,000 reduced to $633.60 or $10,000 reduced to $6,336.00.

Had Spotify used blockchain technology to dynamically identify Tommy as the rightsholder in his song and paid him instantly at the close of the month with cryptocurrency, Tommy would have already spent his $100 on studio time!

Why So Many Hip-Hop Producers Are Putting Business Before Beats

I shared my thoughts on music business for Hip-Hop producers in this piece by Cherie Hu for Pitchfork:

“The way many of these companies are trying to match and verify their data? Hundreds of emails,” says Dae Bogan, founder and CEO of TuneRegistry, a rights management platform for indie artists. “Many labels are still using old software and systems to manage their digital catalog, and their rights department is different from the one responsible for metadata, which is different from the one responsible for collecting royalties. There’s a lot of bureaucracy involved.”

Read the full piece here.

Dae Bogan Included In Bobby Owsinski’s ‘The Music Business Advice Book: 150 Immediately Useful Tips from the Pros’

bobby owsinski dae bogan

Bobby Owsinski is one of the music industry’s greats. His ability to curate music industry knowledge into easy-to-ready texts across his over 20 books has helped thousands of music creators and music industry professionals in their careers. I’ve had the pleasure of being on Bobby’s podcast, Inner Circle, and participating on several music conference panels with Bobby. He is truly an inspiration. In fact, it was partially my participation in the making of his book “Music 4.0: A Survival Guide for Making Music in the Internet Age” that inspired me to write my first, very short, ebook “The DIY Musician’s Starter Guide To Being Your Own Label & Publisher.”

I am honored, once again, to have been included in Bobby’s latest book, “The Music Business Advice Book: 150 Immediately Useful Tips from the Pros,” available on Amazon.

About the book:

The music business can prove to be a difficult career road when you’re first starting out, but it can be traveled a lot easier with some helpful guidance from a pro who’s willing to share a few hard-earned hints. The Music Advice Book is a compilation of the pearls of experience from 130 top music pros from various segments of the industry who have previously shared their most important tips on Bobby Owsinski’s Inner Circle Podcast over the course of almost 5 years.

These 150 tips cover everything from following your passion, learning to network, and working well with your musical team, to owning your own content and even figuring out how much to charge for your services. Also included are even some useful music production words of wisdom, as well as the indispensable “10 Rules Of Networking.”

The insights in The Music Business Advice Book are essential for those new to the music industry but valuable to seasoned pros as well.

Songwriters Are Owed Nearly $2B In Unclaimed Royalties!!! — Maybe More — I’ve Been Saying This For Some Time Now (Against Pushback), But Finally The Press Has Confirmed It

Over the last few years, I’ve been researching and sounding the alarm on the growing problem of unclaimed music royalties or so-called “black box” royalties.

I’ve estimated the value of the collective black box to be nearly or above $2B. I’ve presented research, have written extensively and have spoken publicly about this problem, which disproportionately affect independent and legacy songwriters.

Despite my fanfare, industry insiders and stakeholders have shrugged or have blatantly called my estimates a gross overstatement and have held that unclaimed royalties are at best a few hundreds of thousands of dollars and mostly owed to “long-tail artists” who do not quite understand how the music industry works. This is a very myopic, company-focused view. These talking heads tend to speak from their position of administering one right for some music licensees. My estimates are looking at multiple rights administered by multiple entities, which would make the collective black box exponentially greater than the escrow account of a single entity.

Also Read: State of Unclaimed U.S. Music Royalties and Licenses

Yesterday, Variety published an article on the Music Modernization Act where a very important fact was tucked away on a single sentence in a paragraph near the end of the piece:

The DSPs are holding some $1.5 billion in unmatched mechanical royalties. If the MMA passes, that money would be passed through to the MLC which would match it to the songwriters and publishers. [bold and underline added for emphasis]

via Variety

https://variety.com/2018/music/news/music-modernization-act-blackstone-sesac-congress-senate-1202881536/

$1.5B of royalties (I still believe this number is higher) is sitting in, probably, interest-bearing escrow accounts while songwriters and small-to-medium sized music rights holders struggle to understand how and why.

Last year I founded RoyaltyClaim, the world’s first search engine of unclaimed music royalties and licenses, which has recently been acquired by Made In Memphis Entertainment. We’ve helped DIY musicians and rights-holders identify thousands of unclaimed entitlements in just a few months, with one paricular music producer uncovering nearly $150k in unclaimed royalties due to him.

The problem is huge. The system is not transparent. And the people in charge could do a better job communicating these things to rights-holders.

Also Read: I’m Working On A Side Project Addressing ‘Black Box’ Royalties

I’ve been on many panels at music industry conferences where I’ve maintained my position that DIY musicians and small-to-medium sized rights-holders are owed hundreds of millions of dollars, if not several billion, and often my co-panelists have taken a position that my claims are sensational and overstated.

I disagree.

When those on the panel talk about black box we are talking about the aggregate of unclaimed royalties that occur because of any number of factors,’ and not just limited to one service or one collection society, explained moderator Dae Bogan, CEO of TuneRegistry.”

via Billboard

Source: https://www.billboard.com/articles/business/8456271/black-box-royalties-myths-panel-music-biz-2018

Read the Variety article here.

Check out my commentary on black box royalties here.

Coexisting Music Ecosystems

music

ICYMI, here’s a wonderful piece by Vickie Nauman on the notion of coexisting music ecosystems. I think it offers a fresh and nuanced look at how elements and traces of overlapping music industries — what Nauman calls Music Industry 1.0, Music Industry 2.0, and Music Industry 3.0 — shape our experiences as music industry professionals and consumers. 

Have a read and lets discuss in the comments.

The music industry careens fast down the highway, stacked high with cargo and shiny objects. Think of the old CD business as the flat bed, the current digital industry as its loosely tethered, bulky freight, and artist-driven initiatives as sparkly crates hitched on top. Failed startups litter the rearview mirror. Yet all are tied together in a zigzag of relationships and common building blocks.

In practical terms, we’ve got three different music industries operating simultaneously.

Continue reading here.

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