Fair Play, Fair Pay - Foul Play or Much Overdue?

This Act may be somewhat overdue. In law school, I took an entertainment law class. I needed an elective and it seemed like it would be interesting. Little did I know that this one class would be the thing that determined what type of lawyer I would be upon graduation. At any rate, I remember learning the breakdown of the music industry: who the key players were, copyrights in sound recordings versus musical compositions, and basically just how everything flowed together. It was then that I realized that artists were really on the shit (for lack of better terms) end of the stick. It is the artist who spends long days and nights in the studio recording song after song until they produce “commercially satisfactory” music. It is the artist who travels endlessly on tours to perform for its audience. It is the artist that essentially makes us hate or love a song. I mean, think about it. Your average music lover - and I’m not talking music enthusiasts, I’m talking your regular Joe Schmoe who hears a song he likes, buys the CD to play it on repeat a few times, and goes on about their business - is not checking for songwriters or record labels. He wouldn’t be able to tell you who wrote what and could probably care less, and he wouldn’t dare concern himself with what record label is representing artists they like. He will however be able to you what artist sings what song and probably be able to pick that artist out of a line-up. In that sense, the artist is the music. Now this is not to minimize (by far), the importance of the songwriter or the music label or the producer or any of the other players that go into making a song pop; I say it to at least put the artist on equal footing with them. The songwriter and producer are paid for their songs being played on the radio, it only makes sense for the artist to get paid too. I’m sure at one point in time, it made more sense not to pay the artists for radio play because it was a source of free advertising for them. You hear the song on the radio, you go buy the CD. But nowadays, people rarely buy music, especially not when you can get it for free: YouTube, illegal downloading, file sharing, streaming platforms, the list goes on. We live in a day and age where all you really need is your laptop and the Internet and you have access to the world at your fingertips.

Recording deals are essentially investment deals where the label foots the bill on the outset in creating the image and sound for an artist and collecting all of its money and then some once the money starts coming in. So from the label standpoint, they may be putting all this time, money and energy into an artist and then never reap the benefits, which is why their return on their investment is so great. But from the artist standpoint, they’re basically indentured servants, working for master (label) until freedom day...whenever that might be. All the money generated by the artist record sales, goes to his master (label) and now with the advent of 360 deals, the label gets a piece of all the money generated by the artist relevant to his artistry. The artist barely makes any money because he is already limited to certain income streams and now he has to give a piece of all of his revenue streams to his label. It just doesn’t seem fair.

Performance Rights Organizations (PRO’s) were created to protect songwriters, composers, etc. from being cheated in the music industry. It was important for these organizations to ensure that their members received income outside of whatever deals they had with entities that may actually own the copyright in their creations. Sound Exchange was a step in the right direction as far as providing well-deserved compensation for the artist. Sound Exchange is the ASCAP/BMI/SESAC for the recording artist or sound recording owner, but is only limited to digital play and only collects and distributes digital public performance royalties. The other Performance Rights Organizations (PRO’s) are not so limited in this way. What is the logic behind placing so many limitations on the recording artist’s ability to make money? The artist is clearly instrumental to the song. Why shouldn’t they be compensated for their hard work and talent? Needless to say upon learning all of this in law school, I decided I wanted to be an advocate for the underdogs.

I love the idea of artists being compensated for their hard work, talent and efforts. If one of the main purposes behind copyright law is to encourage creativity and promote the progress of the arts, how are we doing that if we’re not providing adequate incentives (money – hello!) for the people to do that? What I don’t love is who is ultimately responsible for paying for it. Should it be the sole responsibility of the radio broadcasting system to ultimately pay for the plays? Because they certainly aren’t the sole entity abusing the artist. I mean technically, they are the entity putting the music out there and that is generally how any licensing scheme works, but somehow that just doesn’t seem right to me. On the one hand, they do pay the other PRO’s public performance royalties, so why not develop a similar scheme for the artists? And now it seems like we’ve moved in a direction where the radio station needs the artists more than the artist needs the radio station because there are so many other platforms for artist’s music to be heard, but if the radio didn’t have music to play, I doubt if it’d have very many listeners. I think I would propose somehow making the record labels responsible for some of the costs, but I’m sure it’d turn around to bite the artist in the ass by being some recoupable expense in fine print in the artist’s recording agreement…unless the law specifically prohibited that as well. But you know us lawyers, we’ll find a way or make one.

I’m very interested to see how this one plays out. I’m glad the guys in Congress are recognizing the need for artists to be adequately paid for their work. It is definitely about time. Stay tuned…

For questions concerning this article please contact lerae@askmusiclawyer.com