Royalties

Discussion in 'Music Corner' started by thnkgreen, May 23, 2020.

  1. If I build a successful business I can leave it to my Children. If I write a book my Children can benefit from future sales. If I buy up apartment buildings my children can benefit from future rentals or sales.

    What’s mine goes to my son if I choose to leave everything to him.

    works for me. Why do you care ? Go write your own music.
     
  2. Timmy84

    Timmy84 Forum Resident

    Location:
    North Carolina
    It's like every other thread is a chance to hate on a Beatle or Elvis. :)
     
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  3. Dillydipper

    Dillydipper Space-Age luddite

    Location:
    Central PA
    Um..."Elvis"...? :wtf:

    See the very first post, before you quip...
     
  4. George Blair

    George Blair Senior Member

    Location:
    Portland, OR
    Why should an artist physically earn their keep? I always thought one of the great things about living an artistic life would be to escape the labor market. Sounds great to me.
     
  5. Paper Wizard

    Paper Wizard Forum Resident

    Location:
    U.S.A.
    I don’t begrudge anyone who has been successful in life. If someone can make a lot of money so be it. McCartney has written some timeless classics and people love his work. More power to him.
     
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  6. Bassist

    Bassist Forum Resident

    Location:
    London
    The answers to your questions can vary wildly from artist to artist but I will try and help.

    People who you might assume are full members of a band from the marketing / promotion / album artwork / stage positioning might only be being paid a session fee for studio work plus a share of the touring and merch money. There is no hard and fast rule.

    However, in the case of a relatively democratic band structure, songwriters will usually benefit individually from the publishing income but band members will benefit collectively and from equal shares of the income derived from the master recordings. So a band member or their estate will usually see a share from record sales, streaming and other licencing of the recordings but it all depends on their deal within the band's own business "empire". Leaving members of an active band are often bought out of future royalties. Some aren't. Bands that split up generally continue to split income on the basis under which it was divided when the band was still active. Bill Bruford tells a story where he had to buy himself out of Yes in order to join King Crimson.

    Session musicians do have a secondary income stream but it is a very small percentage of a very small percentage. These are called neighbouring rights and is primarily derived from broadcasts of recordings that they appeared on. IIRC they get 10% shared between them of what the featured artist receives. It is something but nothing like as much as the publishing income derived from the same uses. Also, depending on the strength or otherwise of their national union, session musicians can see repeat money when recordings they have played on are used in a new context or when live recordings of performances they appeared on are released later for public consumption - film soundtracks for example, archival recordings in box sets etc

    Back in the day publishers might expect to keep half the income from a song. Some of course grabbed the lot though I believe those to be a minority. As recently as the 90s there were publishers doing deals for near to 0% with star writers because of the value of having the money "resting" in the bank for six months. This was when savings attracted a measurable interest rate. Otherwise an 80/20 or 90/10 split with the writer is not unusual at that level. 70/30 is more the level for a starter deal - new signing. Keep in mind that writers are to some degree protected in that they receive 25% of the money from streaming and 50% of the money from broadcasts and performances of their songs in concerts directly via their local writer's society and those income streams never touch the publisher's account. All in all any problems in the publishing industry are rooted in unfair heritage deals, in some of the rates that have been struck with streaming services (something that is in the process of being corrected) and in the foibles enshrined in the international collection system itself. Otherwise I think the music publishing system is not unfair on writers. As an aside, truly democratic bands will also split some or all of the publishing income between the non writing members so as to keep the peace.

    The last question is impossible to answer. Depends on the streaming platform and depends on the country but if you think of a general ballpark of $5k per million streams and $7 per full price download album you wont be far off. When it comes to retail how long is a piece of string? On a sale via a major retailer if you take the retail price, break out the sales tax and then take 40% - 50% of what is left then that is in the range of what the label might see after distribution and the massive retailer discounts being demanded. Lets say £4.50 on a £12 album. On a direct to consumer sale of course the numbers are considerably different. Out of that £4.50 ish they have to pay the artists (around 20% of wholesale depending on the deal), the publishing (around 6.5% of retail price depending on the country), manufacturing, promotion and overheads. Plus in many cases the cost of recording and producing artwork for the record in the first place. You can see why labels with big heritage catalogues love streaming and love mail order.

    People who don't see why writers should still be getting paid on works they created decades before are people who don't like capitalism though are unlikely to apply the same thinking to the broader economy. Somehow songwriting is not seen as work or in essence entrepreneurial.

    Hope that helps a bit!
     
    Last edited: May 24, 2020
  7. Campaigner

    Campaigner Too late to cause a stir

    Location:
    Australia
    Brilliant - thanks!
     
  8. Safeway 1

    Safeway 1 "mad, bad, and dangerous to know"

    Location:
    Manzanillo, Mexico
    Good article from a good website. Try some of this gentleman's views on wealth, royalties etc.
    Anand Giridharadas: Speaking Truth to Billionaires | Doha Debates
     
  9. wildstar

    wildstar Senior Member

    Location:
    ontario, canada
    None of that is even *remotely* true. Actually it's pretty much all the polar opposite of the truth!

    1 - Epstein was very inexperienced (if not incompetent) at making business deals, regularly securing for his clients far less that they deserved given their level of fame/success.

    2 - The Apple label was an empty facade as far as The Beatles were concerned - an illusion. They were ALWAYS a Parlophone/EMI act, and were signed to EMI until (IIRC) Jan 1976. The Beatles/Apple *never* owned the Beatles masters - EMI did. Apple was a record company owned by the Beatles, but ONLY to release music by other acts that they discovered/signed. Apple owned the Badfinger, Mary Hopkin et al records which all went OOP when Apple folded in the mid-70s, and which all stayed OOP (for roughly a decade and a half) until Apple resumed operations in the early 1990s. The Beatles albums didn't go OOP between the mid 70s and early 90s. When Apple folded, EMI simply changed the labels on the Beatles records from Apple back to Parlophone/Capitol on future pressings.

    3 - Northern Songs was primarily owned by Dick James, who also screwed the Beatles. He retained a controlling share of Northern Songs (at least 51%). The others split the rest between them: Lennon/McCartney + Epstein - and even George and Ringo were given a very small percent each (something like 2% each or thereabouts). With Dick James owning AT LEAST 51% does that sound like The Beatles really owned/controlled their publishing? After Epstein, Harrison and Starr got their cut, Lennon and McCartney couldn't have owned more than 20% of the company each. Which explains why Dick James was able to sell the company more or less behind their backs in the late 60s. They fought the acquisition and when they failed they were compelled to then sell their minority shares to the buyer who had bought the majority share from Dick James.

    From that day on, the Beatles owned ZERO % of their publishing! Not just for their Beatles songs either, because their Northern Songs publishing deal lasted until IIRC 1973. So the in the early years of their solo careers they were still tied to their Lennon/McCartney/Northern Songs songwriting contract. McCartney was sued by the new owner of Northern Songs who disputed the Linda co-writes that McCartney registered with them, claiming/insisting that those co-writer credits were fraudulent and meant to deprive Northern Songs of one half of the publishing on those songs, since Linda was never signed to Northern Songs and as such was able to register her half of those songs with her (and Paul's) own newly formed publishing company, thus allowing them to own her half of those songs.

    Also I don't think there was an actual lawsuit (but rather a negotiated settlement) but there was definitely a several months delay in the release dates of Happy Xmas and the STINYC album between the US and UK due to Yoko's co-writer credits being disputed in the same way/for the same reason.
     
  10. BDC

    BDC Forum Resident

    Location:
    Tacoma
    I'm a union man too making good wages, and hate when underpaid workers think the solution is bringing others wages down.
    High taxes on income after the 1st few million inspires reinvestment that creates jobs, that's how it used to be in the US.
    Low taxes on big incomes does nothing for anybody except the guy making the money. The solution to the OP's question is higher marginal tax rates. Paul probably paid too much taxes in the 60s and probably doesn't pay enough now.
     
  11. Rick Bartlett

    Rick Bartlett Forum Resident

    I on the other hand, think this is a GREAT thread idea to discuss.
    Some good information here shared by those who know the happenings of the 'music business'.
    Others also have no idea what they are talking about here.....

    Like McCartney, a chosen at the top take 'the cream'.
    Dare I say, Ed Sheeran or Taylor Swift?
    Ed is 'reportedly' worth about 200 Million Pounds, and he isn't even 30 yet.
    Taylor Swift, something like US$360 Million.

    As discussed earlier, the clever operators make their money 'work for them'.
    Investments, Property etc etc
    With Power and Success, they can sway their record contracts, own their masters, publishing/royalties for better deals.
    If it were that easy, every artist would be doing it....
    Back to one of the OP's questions, how much is enough or too much?
     
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  12. old school

    old school Senior Member

    It’s none of your business what musicians make. If their billionaires good for them. That’s why there’s no business like show business. You sound like a socialist putting limits on what people can make. Some people pick up a guitar others a shovel there choice’s lead to what they make. At least their free to make as much money as they are able to.
     
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  13. Old Fart At Play

    Old Fart At Play He won't eat it, he hates everything

    Location:
    Los Angeles
    I didn't mean to be rude when I repeated the assertions that this thread is ignorant. The problem is that it seems to be conflating about ten different concepts.

    I believe that the OP's fundamental, root position is that there shouldn't be excessively wealthy individuals. Fair enough. But for some reason that belief is randomly and inexplicably applied to musicians. I don't see any reason to single out extremely wealthy musicians from any other extremely wealthy people.

    And then the argument is defined as being based on "royalties," when it seems like what it's really about is copyright protection. But we don't know OP's thoughts on copyright - does he/she not believe that there should be any copyright, or that the term is too long, etc.? Regardless, why should extraordinarily wealthy copyright owners be treated differently from any other extraordinarily wealthy individuals? I'd say Paul McCartney (or Elvis) deserves his wealth more than Jeff Bezos does.
     
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  14. Bassist

    Bassist Forum Resident

    Location:
    London
    For the record socialistic policies, as actually practised in real functioning and successful economies (the Nordic Model for example), don't put a limit on what an individual or a corporation can make.

    It does seek to redress structural imbalances to ensure that resources flow in a supportable fashion to ensure a minimum standard of living overall. This will be reflected in universal standards of state funded health care and education etc. Personal and corporate tax rates will be commensurately higher as a result but personal expenditure in key areas (especially health and education) will be substantially lower and often zero. No structure is without its issues and problems but the top 7 places in the World Happiness Report are occupied by northern European countries broadly following that kind of economic model. Sweden, Norway and Denmark all run substantial surpluses. Non socialistic economies such as the UK and US run the largest deficits.

    Socialism rooted in Marxism as practised in non-functioning, unsuccessful economies is something else entirely. Freedom of artistic expression is not generally welcomed and artist and writer royalties are unlikely to be collected or paid at all!

    China is a hybrid of capitalism and communism where, currently at least, Marxist thought is "discouraged". They are paying music royalties, in a fashion at least.
     
    Last edited: May 24, 2020
  15. Howard Bleach

    Howard Bleach Imperial Aerosol Kid

    Location:
    green bay, wi
    Bingo. This a million times.
     
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  16. chervokas

    chervokas Senior Member

    It's also worth noting -- like when you bring up the examples of Ed Sheeran and Taylor Swift (both of whom are terrific, IMHO), but also McCartney too -- songwriting royalties aren't the only revenue streams for performing songwriters. Touring income is a big source of a lot of their revenue. Plus, as the name performing act on a recording contract, they get money from recorded music sales and streams and licenses unrelated to their songwriting royalties.

    For example, Ed Sheran did a tour where he played 258 dates and the tour grossed $777 million dollars -- I bet that that tour was way more lucrative that the album it was nominally in support of (does the tour support the album or the album support the tour, if the tour is the big money maker?), which I doubt generated anything close to the three quarters of a billion dollars in gross revenue. The album did extremely well, the hit songs from it will be generating income for Sheeran for the rest of his life (and beyond) because they'll be used in movies and commercials and played on oldies stations for decades. Yup, people will be dancing to "Perfect" at weddings for a generation or two. But I don't know if all in the recorded music will ever generate $777 million in songwriting payments.
     
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  17. Rick Bartlett

    Rick Bartlett Forum Resident

    That's right, also why tour merchandise is expensive too.
    Things that only cost a dollar to produce like posters, keyrings, caps, stickers etc etc, are sold at a premium price for such reasons.
     
  18. thnkgreen

    thnkgreen Sprezzatura! Thread Starter

    Location:
    NC, USA
    Very good answer. How many do, I wonder...
     
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  19. Pizza

    Pizza With extra pepperoni

    Location:
    USA
    I’m not baffled at all. They wrote the music. Of course they should get royalties. I’m more ticked at record companies that still want me to pay top dollar for decades old albums.
     
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  20. Beattles

    Beattles Senior Member

    Location:
    Florence, SC
    Including Happy Birthday! I believe the publishing royalties in the US now extend to 75 years.

    The Kennedy's, a husband and wife duo that have a folk, rock, power pop pedigree showed their Spotify check on their Sunday Quarantine stream last week. $0.01 for several thousand streams.
     
  21. And McCartney bought songs. Lots of songs. He bought the publishing to some wonderful catalogs of music that generates income.
     
  22. old school

    old school Senior Member

    The Nordic countries pay the highest taxes and the healthcare is terrible. You wait months to get any procedure done. In the United States you pay way more for healthcare but it’s way better than socialized medicine and you have a choice of doctors to pick from. You get what you pay for free healthcare is lousy if you don’t put nothing in what do you expect to get?
     
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  23. Beattles

    Beattles Senior Member

    Location:
    Florence, SC
    Roger McGuinn testified before Congress that he never received a royalty check from a record company. He did receive advances but no matter what a record sold they always deducted enough returns, promos, dead stock to cancel out any sales over the advances he received. He did receive publishing royalties on his compositions.
     
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  24. dubious title

    dubious title Forum Resident

    Location:
    Ontario
    You know there was a reason. Two extremes were chosen, Paul and an imaginary coal mining father. If it were say....... Ian Curtis or Robert Johnson and an accountant father it wouldn't play quite as well.

    I'd be surprised if the Beatles haven't been connected to global warming at this point.
     
  25. JM Jones

    JM Jones Forum Resident

    Location:
    ohio
    Why not? He earned it.
     
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