BMG Eliminates 'Unacceptable' Royalty Deduction, Other Labels Urged to Follow (credit - Billboard PRO)
By Ed Christman - As part of its ongoing review of historic artist and songwriter contracts for anomalies or inequities, BMG says it will eliminate the application of the controlled composition clause which reduces royalty payments for artists that write their own songs, for all releases going forward, regardless of what each artist’s contract says.
The control composition clause is often employed by record labels to insure that when they sign artists that write their own songs, that the labels also can license the publishing for records it plans to issue. But its also has been used to reduce songwriting royalty payments, allowing labels to pay such artists/songwriters only 75% of the statutory mechanical rate, currently 9.1 cents per song; and to limit royalty payments to 10 songs, even if an album has 14 songs.
For example, if an album has 14 tracks on it, applying the statutory royalty rate would come out to $1.274. But the controlled composition clause would only pay for ten songs, which normally would be 91 cents, at a 3/4 rate, or 68.25 cents in mechanical royalties. So, what happens if two of those songs on the album were cover songs or authored by outside songwriters? Songs by outside songwriters would have to be paid at the full statutory rate of 9.1 cents per song, which would further reduce the artist/songwriter overall mechanical royalty for the entire album to 50.05 cents. In this example with the artist writing 12 of the 14 songs on the album, that works out to 4.17 cents in mechanical royalties per song, or less than half the statutory rate.
However, both of those tactics were eliminated with regards to downloads and streaming by the Digital Millennium Copyright Right Act. Consequently, the control composition clause only applies to physical formats, and mainly only to those that occur in the U.S., and not in other countries.
But with vinyl on the rise and the CD still holding on, Billboard estimates the control composition clause potentially short-changed songwriters by $15 million in the U.S. last year.
“It is unacceptable for the record industry to continue to apply deal terms which are solely designed to reduce the incomes of musicians,” BMG CEO Hartwig Masuch said in a statement on his company's stance. “We have heard a lot during the coronavirus crisis of initiatives by music companies to support artists. The best way to support artists is not to subject them to unfair terms in the first place.”
In a statement supplied to Billboard by BMG, Nashville Songwriters Assn. International executive director Bart Herbison applauded the move and then challenged “every record label to follow their lead and fully eliminate controlled composition immediately.”
Likewise, Songwriters Of North America co-founder and music lawyer Dina LaPolt applauded the move saying, “This clause is an antiquated and restrictive provision,” and also urged other record companies to follow BMG’s lead.
Meanwhile, in another statement supplied as part of the announcement, Crispin Hunt, the chair of the Ivors Academy which celebrates songwriting through its awards presentation, labeled the control composition clause one of “many other tricks of the trade,” and added. “BMG’s abandonment of this regressive practice is a huge step on music’s journey to dignity. Music can’t change its past but we can change its future.”
BMG announced in June that it is scouring contracts to suss out other “tricks of the trade,” as Hunt put it, and it has set up a task force, headed by the company’s chief operating officer Ben Katovsky, with the goal of improving fairness in music contracts, including reviewing historic acquired record contracts for signs of racial bias.
Since BMG was re-launched in 2008, the company started from “scratch and [designed] out many of the worst aspects of the old business” for new deals, Katovsky said in a statement. “But the company still “sometimes finds examples of historic bad practice lurking in some of the catalogues we have acquired."
So with its latest move in that direction, this means that even with acquired catalogues that come with contracts that allow BMG to employ the controlled composition clause, going forward, it will not use that provision to reduce songwriter royalties.
Songwriters and publishers have long railed against the controlled composition clause, and when the Digital Millennium Copyright Act was coming into being back in 1998, the National Music Publishers’ Assn. led the charge to ensure that the clause's use to reduce songwriter royalties “would be illegal for digital products,” NMPA president and CEO David Israelite said in a statement supplied by BMG. “BMG deserves enormous credit for eliminating this poisonous practice," Israelite said. "Controlled composition clauses in recording contracts have been one of the most harmful things to ever happen to songwriters....This is a wonderful pro-songwriter move by BMG.”
BMG’s Masuch indicates that the company will continue its work on this front. “The controlled composition deduction is just one of a whole series of ways in which record labels have historically maximized their own profits at the expense of musicians,” Masuch said. “Eliminating this unfair practice is just the latest in a series of measures BMG is taking to make the music industry fairer to artists and songwriters.”
Indie Venues Devastated After Trump Kills Stimulus Talks: 'This Is Real. We Need Help' (CREDIT BILLBOARD PRO)
BY DAVE BROOKS - Congress' most recent aid package included up to $10 billion for concert halls forced to close due to the pandemic. Now their futures look grim.President Donald Trump has ordered Treasury Secretary Steve Mnuchin to end talks with Speaker of the House Nancy Pelosi over a package of COVID-19 relief bills that included more than $10 billion in aid for independent music venues, agencies and music companies indefinitely shut down by the global pandemic. Unless Trump changes his mind soon, it's unlikely that a relief package will be passed before the election.
Trump, who was released from the Walter Reed Medical Center Monday night after being diagnosed with COVID-19 made the announcement via Twitter, writing that he was instructing Mnuchin to end talks over the $2.4 trillion Heroes Act package until after the election.
"It's devastatingly horrible news," says Stephen Chilton with the Rebel Lounge in Phoenix. "More venues are going to close -- I think the reason we haven't seen even more venues shut down is because everyone is holding out hope that Save Our Stages passes. I'm not sure how much longer people can hold on -- there's rent, there's debt obligations and there's a lot of costs. It's already been six months with zero revenue."
Venues Closing Across America: An Updating List (And Why It Matters)The news came as a major disappointment for two major independent arts associations who were encouraged last week when Pelosi announced that the Save Our Stages Act would be included in the $2.2 trillion Heroes Act. Save Our Stages would have provided up to $18 million to any independent music venue forced to close because of COVID-19.
“We have been sounding the alarm since April that if our members don’t get emergency assistance, they will go under forever -- and it’s happening,” says Audrey Fix Schaefer, director of communications for the National Independent Venue Association. For months the group has been warning that without federal assistance, more than 90% of its 2,500 members would go out of business.
“This is real. We need help. We urge Congress and the White House to continue negotiations and reach a deal quickly or there will be a mass collapse of this industry," Fix Schaefer says. "The Save Our Stages Act has already passed the House and has strong bipartisan support with more than 160 Congresspeople cosponsoring because they know independent venues can be part of our country’s economic renewal once it’s safe to welcome people back -- if our venues can survive this pandemic. We're also hoping for the sake of our furloughed employees that the Pandemic Unemployment Assistance will be extended, as people are suffering through no fault of their own."
Neumos in Seattle, in a Pandemic: Passing the SOS Act 'Would Be Such a Huge Win For Us'A representative from the National Independent Talent Organization also released a statement urging Congress and Trump to quickly pass some type of assistance for those impacted by COVID-19.
“We continue to advocate for the needs of our members and the independent live music business community and hope that our government does not abandon us," the statement read.
The Heroes Act had passed the House of Representatives earlier this week and many venue managers were hopeful that the Save Our States Act would be included in a final aid package signed by the President.
Dozens of venues have already closed because of the pandemic, including the U Street Music Hall in Washington D.C., which announced Monday it was shutting its doors after 10 years of operation.
"When we closed our doors to the public this past March, just days before we were to celebrate our club’s 10-year anniversary, none of us could have imagined at the time that we would still be closed nearly seven months later with no return date in sight because of an unrelenting disease called COVID-19,” the venue said in a statement on Twitter. “But due to the pandemic, mounting operational costs that never paused even while we were closed, and no clear timeline for when clubs like ours can safely reopen, we had no choice recently but to make this heartbreaking decision.”
New Study Finds Hollywood Studios Could Lose Money From Movies That Lack Diversity (Credit - DEADLINE)
By Dino-Ray RamosAssociate Editor/Reporter
October 6, 2020 5:00am
It’s been said before, but it is worth saying again: diversity pays — but not in terms of checking boxes and tokenism. In a new report from the UCLA-based Center for Scholars and Storytellers titled “Beyond Checking A Box: A Lack of Authentically Inclusive Representation Has Costs at the Box Office”, researchers found that bringing authentic diversity to film improves financial performance at the box office while a lack of diversity can result in losses for studios.
Films like the Latino-fronted Pixar animated pic Coco, Marvel Studios’ Black Panther and Warner Bros’ Crazy Rich Asians proved that racially diverse casts can bring in highly profitable grosses at the box office, according to UCLA’s Hollywood Diversity Report produced by a group of UCLA researchers including Darnell Hunt, dean of the College’s division of social sciences. However, when it comes to writing and directing jobs, underrepresented voices still have quite a way to go.
The report which was published today analyzed 109 movies from 2016 to 2019 and found that movie studios can expect to lose up to $130 million per film when their offerings lack authentic diversity in their storytelling. Researchers found that large-budget films (a budget of $159 million or more) are subject to a significant cost in the opening weekend box office for a lack of diversity.
They estimate a $159 million movie will lose $32.2 million, approximately 20% of the its budget, in first weekend box office, with a potential total loss of $130 million, 82% of its budget. For a $78 million budget movie will lose $13.8 million in its opening weekend for a lack of diversity, with a potential total loss of $55.2 million, 71% of its budget.
“We asked, what is the cost of lacking diversity? Hollywood is a business, and no business wants to leave money on the table,” said senior author Yalda T. Uhls, a UCLA adjunct assistant professor of psychology and founder and executive director of the Center for Scholars and Storytellers. “While increasing numerical representation behind and in front of the camera is critical, truly empowering people from diverse backgrounds is the key. For example, make sure the writers room is open to dissenting opinions, that a wide net is cast for hiring, and that younger, less-tenured voices are encouraged.”
In order to compile the data, the researchers used a metric for authentic and diverse storytelling called Authentically Inclusive Representation (AIR) that represents the inclusion of diverse voices, people and cultures both in front and behind the camera. Using Mediaversity Reviews, researchers ensured their ratings were comparable to another robust source of diversity ratings that captures numerical race and gender diversity in key cast members and writers, directors and producers. The researchers also compared Mediaversity ratings to the critical acclaim websites, Metacritic and Rotten Tomatoes and found Mediaversity ratings are highly correlated with those of Metacritic and Rotten Tomatoes.
To no surprise, small-budget films lead the charge when it comes to diversity, dramatically surpassing big-budget pics on AIR. The analysis looked at films such as Barry Jenkins’ Moonlight from 2016 (budget: $4 million, total box office: $26 million) and Greta Gerwig’s Lady Bird from 2017 (budget: $10 million, total box office: $48 million).
“Storytelling that lacks AIR in race, gender and sexuality can have immediate and significant costs,” said Gerald Higginbotham, a UCLA psychology doctoral student, and co-author of the report.
The researchers analyzed the first weekend U.S. box office results because these numbers closely capture audience demand before word-of-mouth, reviews and the release of newer films impact attendance. Uhls points out that the first weekend box office, particularly for wide releases, typically accounts for about 25% of total box office. Any reduction in box office in the initial weekend would typically impact the film’s total financial success.
“While our findings are specific to box office, we believe we captured broadly the more immediate costs of lacking AIR, which is relevant to other kinds of releases and types of content,” Higginbotham said.
In the study, researchers offer recommendations, including:
Stephanie Allain, Founder Homegrown Pictures, said of the report: “I hope that executives will seriously consider these findings when deciding what to greenlight. I’ve spent my entire career supporting voices and content that are not often seen on the big screen. But it has always been a struggle and the budgets are typically smaller to validate the absurd fallacy that Black content doesn’t travel internationally.”
She added, “This study demonstrates that studios are leaving money on the table by not showcasing stories that are authentically diverse. Perhaps now is finally the time that Hollywood movies, which shape hearts and minds throughout the world, will start to reflect ALL of us in ways that resonate deeply with the multicultural audiences that make up the USA.”
As the film and TV industry — and the world for that matter — continue to have a reckoning when it comes to the lack of diversity and the silencing of underrepresented voices, the needle is moving when it comes to change and progress. It may be moving at a glacial pace, but it is change nonetheless. We are seeing steps to help achieve equity in film & TV with more programs for marginalized voices in front of and behind the camera as well as an increase in demand for accountability. One of the biggest attempts is from the Academy of Motion Picture Arts and Sciences which announced new standards of representation and inclusion for Best Picture that will gradually be put in place for the 94th (2022) and 95th (2023) annual Academy Awards, with the standards going into full effect beginning with the 96th Academy Awards in 2024.
AMAZON MUSIC PARTNERS WITH UNIVERSAL, WARNER TO EXCLUSIVELY OFFER STREAMING ALBUMS IN ‘BETTER THAN CD QUALITY’ ULTRA HD - MBW
Amazon has inked fresh partnerships with Universal Music Group and Warner Music Group to remaster thousands of songs and albums to Ultra HD streaming audio quality – and make them exclusively available on its Amazon Music HD service.
According to Amazon, Ultra HD offers “better than CD quality” audio, with a bit depth of 24 bits and a sample rate up to 192 kHz. Amazon Music HD already offers 5 million tracks in Ultra HD.
Now, thanks to its fresh deals with Universal and Warner, Amazon says a raft of additional tracks are joining this Ultra HD catalog, “revealing nuances that were once flattened in files compressed for digital streaming or CD manufacturing”.
Hundreds of full albums are being remastered for the format, including Kid Cudi’s Man On The Moon: The End of Day; Nirvana’s MTV Unplugged in New York; Waylon Jennings’ Don’t Think Twice; Diana Ross’ Diana & Marvin; B.B. King’s Lucille; Lady Gaga’s Joanne; Ariana Grande’s debut album, Yours Truly; 2 Chainz’ The Play Don’t Care who Makes It; J. Cole’s KOD; and Bob Marley and the Wailers’ Natty Dread.
Amazon says that all titles resulting from this Ultra HD music partnership will be delivered in 24 bit and 96 kHz or 192 kHz.
In addition, the new Universal and Warner partnership will see Amazon Music add to its catalog of over 60 million lossless High Definition songs (i.e. CD quality) as well as its growing catalog of tracks remixed in 3D Audio.
Amazon says that music from artists including Eagles, Elton John, Linkin Park, Tom Petty, Ariana Grande, Jon Pardi, Shawn Mendes, Lady Gaga, Lil Tecca, Selena Gomez, Post Malone and more has been remixed in 3D Audio formats including Dolby Atmos and Sony 360RA, “offering a truly immersive listening experience for customers”.
Listeners will be able to stream these 3D Audio mixes when listening through Amazon Music HD on Amazon’s high-fidelity smart speaker, Echo Studio, which launched late last year at a $199.99 price point.
“We launched Amazon Music HD last year with a promise to always offer our customers the best quality recording available for streaming,” said Steve Boom, VP of Amazon Music.
“With this partnership, we are building upon that promise by upgrading existing recordings to make the listening experience even better, and preserving artistic legacy for future generations. We are thrilled to have the support from Universal Music and Warner Music to deliver key recordings from their catalogs, exclusively for Amazon Music customers.
“We’ll continue to work with more labels to upgrade the digital quality of even more audio recordings, and provide customers with all of the emotion, power, clarity, and nuance of original recordings across all genres.”
“WITH THIS PARTNERSHIP, WE ARE BUILDING UPON THAT PROMISE BY UPGRADING EXISTING RECORDINGS TO MAKE THE LISTENING EXPERIENCE EVEN BETTER, AND PRESERVING ARTISTIC LEGACY FOR FUTURE GENERATIONS.”
STEVE BOOM, AMAZON MUSIC
Michael Nash, Executive Vice President of Digital Strategy at Universal Music Group, said: “Amazon Music continues to push the boundaries in sound fidelity and innovation, and we’re thrilled to partner with them to accelerate the availability of our catalog in the highest quality formats possible and to provide new experiences in immersive audio.
“Our announcement today is the next big step in an ongoing partnership and music fans on Amazon Music HD can look forward to incredible new ways to experience the latest releases, as well as their favorite songs from Universal Music Group and our labels.”
“AMAZON MUSIC CONTINUES TO PUSH THE BOUNDARIES IN SOUND FIDELITY AND INNOVATION, AND WE’RE THRILLED TO PARTNER WITH THEM TO ACCELERATE THE AVAILABILITY OF OUR CATALOG IN THE HIGHEST QUALITY FORMATS POSSIBLE.”
MICHAEL NASH, UMG
Kevin Gore, President of Global Catalog, Recorded Music at Warner Music Group, said: “We’re always excited about new opportunities for fans to experience music in the highest sound quality available, exactly as the artist intended.
“With Amazon Music HD, 3D Audio, and with the Echo Studio, music lovers are now able to immerse themselves in the original recordings at an unprecedented level of fidelity for a price that had previously been out of range.
“Warner Music is proud to partner with Amazon Music on this initiative and will continue to deliver groundbreaking new music from the world’s greatest artists along with iconic albums and songs from our unparalleled catalog.”
“WITH AMAZON MUSIC HD, 3D AUDIO, AND WITH THE ECHO STUDIO, MUSIC LOVERS ARE NOW ABLE TO IMMERSE THEMSELVES IN THE ORIGINAL RECORDINGS AT AN UNPRECEDENTED LEVEL OF FIDELITY FOR A PRICE THAT HAD PREVIOUSLY BEEN OUT OF RANGE.”
KEVIN GORE, WARNER MUSIC GROUP
Albums including Tom Petty’s upcoming Wildflowers & All the Rest; Eagles Live From The Forum MMXVIII; Linkin Park’s 20th anniversary edition of Hybrid Theory; the Ramones’ eponymous debut album; Lady Gaga’s Chromatica; Post Malone’s Hollywood is Bleeding; and Selena Gomez’ Rare, will soon be available to stream in 3D Audio.
Gregory Porter’s newest album ALL RISE, available from Blue Note Records, was released August 28 in Ultra HD and 3D/Dolby Atmos exclusively on Amazon Music HD.
Amazon Music HD is currently available to stream in the US, UK, Germany, and Japan.
The service, at a higher audio resolution than the standard Amazon Music Unlimited tier, costs $12.99/month for Prime members and $14.99/month for Amazon customers.
Alternatively, Amazon Music HD costs an additional $5/month for existing Amazon Music Unlimited subscribers (Individual or Family Plan).
Obviously enough, there’s one major record company not involved in today’s announcement.
Sony last year announced its own next-gen audio format, 360 Reality Audio, in partnership with the likes of Deezer, TIDAL and Amazon Music itself.
It’s been a busy week for news on audio innovation on streaming services.
On Tuesday (September 29), MBW got hold of a patent filed by Spotify that suggests the service is planning a 3D Audio advertising tie-up, with promotional audio messages pushed to consumers as they pass restaurants, coffee shops etc.