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Collecting Royalties - Good or Bad?

Agents of copyright holders such as BMI and ASCAP in the US and SOCAN in Canada license venues that host live and recorded performances, collecting royalties, based on guesstimates of whose songs get played, how often. Music broadcast on radio and TV are also monitored and payments for performances are collected. While these organizations appear to represent musicians, they benefit only small groups of people who own music copyrights. They offer no benefit to musicians who perform the music nor any benefit to all the other people that turn a song into a money making hit. I want to emphasize my view that a hit song is developed as a group effort with different talents and skills merging in the final result. Not infrequently, a song passes through many performers, recordings, and marketing efforts before it reaches the right team with the right combination of talents to turn it into a hit. The audience also plays a creative role, and audience networking is essential to marketing success. The songwriter plays a relatively small role in creating the monetary value of a song.

The existing performance monitoring systems are at best approximations (aka distortions) of just reward, but inevitably inequities develop and not everyone is happy with the control that copyright holders exert over the music business. Take ASCAP, for example: this society is owned by members and began as way for composers (songwriters) to collect royalties from performances of their compositions. ACSAP describes itself:" The American Society of Composers, Authors and Publishers (ASCAP) is a membership association of more than 390,000 U.S. composers, songwriters, lyricists, and music publishers of every kind of music. Through agreements with affiliated international societies, ASCAP also represents hundreds of thousands of music creators worldwide. ASCAP protects the rights of its members by licensing and distributing royalties for the non-dramatic public performances of their copyrighted works. ASCAP's licensees encompass all who want to perform copyrighted music publicly. ASCAP makes giving and obtaining permission to perform music simple for both creators and users of music."

ASCAP distributes money from a variety of sources, in the best case directly to the original authors of compositions.   Licensing fees earned by ASCAP, BMI and SESAC come from television, radio, public performance rights, and websites that download music and offer satellite radio. Sampling the number of plays favors pop, R&B and rock and roll and may underestimated plays for other genres such jazz, instrumental music, and indie music in general. This sampling bias assured that the rich get richer and the poor get poorer. Night clubs, restaurants, and bars pay according to their size, frequency of music performance, and the number of musicians playing live. The license fee is established before the fact, regardless of the actual income enjoyed by the venues. Many small club owners and  musicians who want to perform in these clubs suffer from ASCAP control of performance rights.

For a lucky few who create popular songs ASCAP acts as a source of regular income, sometimes for life. Problems arise when original authors sell the rights to their works to publishing and recording companies who then collect the royalties. Four large and international companies control the publishers rights for most of the songs that have made big money in the past century. These companies want to collect money each time one of their songs is performed in public, recorded, played or sold as printed music. ASCAP is now one big business acting in the interests of other big business. In 2009,  they collected $995 million, $48 million more than 2008. Despite this impressive display of wealth generation, awards to individual members were cut. Film music magazine reported: " ASCAP has declined to specify the amount of the cuts, however ASCAP members in online music forums discussing the issue have reported cuts in their payments ranging from no reduction to a 20% – 30% reduction compared to previous amounts... ASCAP did not respond to multiple requests seeking a further explanation for the payment cuts."

I was unable to get any real data on ASCAP money distribution. Real data would clarify who gets most of the money. An ASCAP critic will recognize that commercial music is dominated by a few writers, a few performers and a diminishing number of corporations that promote and receive income for music performance. Mike Masnick wrote a dissenting opinion:" ASCAP feels like the gift that keeps on giving to those of us covering it. If you're an artist... not so much. We've covered many examples of how ASCAP's aggressive efforts to shut down venues from hosting up-and-coming singers is harming local musicians. And, we've also pointed out how they use a system to overpay large acts at the expense of small acts. Now it's getting even worse. Just as ASCAP is attacking groups like Creative Commons, EFF and Public Knowledge who help artists find  new ways to control their own careers, it's also cutting back on payments to many of its artists." 

Smart countries have laws against monopolies for good reason. Smart musicians, music scholars, and legal experts  have identified serious antisocial properties of corporations that are of concern to anyone who values creativity and personal freedom.  These problems are manifest in the music business but apply everywhere, at all times, to all lucrative businesses. Bowe reviewed BMI and the other copyright enforcers in the US. BMI  developed software,  Blue Arrow, to  identify music played on  Internet sites, radio and TV stations. (A similar system Gracenote is also used to identify copyrighted tunes.) Their sampling is still limited, but may be able to recognize more composers  whose works are played infrequently.  He referred to "Lawrence Lessig, a Harvard law professor  who " worries about the slippery slope created by new technologies. If technology creates efficient ways to charge commercial users of copyright, then that’s good, but what I fear is that we evolve into a permission culture, where every single use of music creates an obligation to pay. I wish the line could be as clear as commercial exploitation — you’re running a dance club, using it in a movie. The author ought to have the right to be paid for that. But I don’t think that that right should translate into the right to control whether my kid uses the music for a collage he makes for a class!” 

In a perfect world, creativity would be nurtured, generosity would prevail over greed, intellectual content would be shared freely, and authors of original works would be rewarded appropriately.

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  • Topics presented at Persona Digital Studio are from the book,
    The Sound of Music
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    Persona Digital Studio is located on the Sunshine Coast, Sechelt, British Columbia, Canada.

    Persona Music Recordings: Our Music Catalogue includes recorded performances under the names P2500 Band, Em4U, and the Persona Classical Consort. Some music online is offered to illustrate music history, advance music education and appreciation. The recordings presented online demonstrate Persona Studio's composing, arranging, recording and mastering techniques. All the recordings are completed in house by Stephen Gislason.

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