Life on the Row Archives

New Talent Agency on the Row

Early in October, Joey Lee, former CEO at Buddy Lee Attractions , left that agency to form 360 Artist Agency, a full-service talent agency. This ends a very long tenure for the namesake’s son at the helm of the famous Nashville agency.

Mr. Lee took several of his clients with him to the the new agency, including Lee Ann Womack, Miranda Lambert and Heartland, but 360’s final roster has not been published. In addition to these three artists, Lee was the responsible agent at Buddy Lee for Bo Bice, Mark Chesnutt, Jared Nieman, Rhett Akins, and Thomas Martinez. Tony Conway remains as president of Buddy Lee Attractions. You can check out his current MySpace for more information.

Lee can be reached at 903 18th Ave. S., Nashville, Tennessee 37212, (615) 360-0911. Email: [email protected].

Copyright Issues, Entertainment Industry News, Life on the Row, Music Row News

Vanderbilt Students to receive a round of RIAA Letters

vuLogo2 Fueled in part by its success in Virgin v. Thomas, the RIAA (on behalf of EMI Music, Sony BMG Music Entertainment, Universal Music Group and Warner Music Group) issued a new round of pre-litigation letters to college students across the country Thursday of last week. This is its ninth such round of letters since beginning the campaign against downloaders nearly two years ago. This round included letters to 32 students at Nashville’s prestigious Vanderbilt University. Vanderbilt received the third greatest quantity of letters in this round, behind University of Southern Florida, with 43 and Southern California with 37.

In addition to those three institutions, the RIAA also sent letters to these 16 schools (quantity in parentheses): Drexel University (17 pre-litigation settlement letters), Indiana University (23), Northern Illinois University (25), Occidental College (19), State University of New York at Morrisville (18), Texas Christian University (20), Tufts University (15), University of Alabama (14), University of California, Berkeley (19), University of Delaware (18), University of Georgia (13), University of Iowa (18), University of Michigan – Ann Arbor (20), University of Nebraska-Lincoln (13), University of New Hampshire (30), University of New Mexico (17).

As with the more than 3,500 letters previously sent to college students at other schools, the letters gives students the opportunity to resolve copyright infringement claims against them at a discounted settlement rate before the threatened lawsuit is filed against them. The letters are accompanied by instructions to the university administrators to forward the letter to the appropriate individuals the give them the opportunity to promptly resolve the matter and avoid a lawsuit. So far, the RIAA has filed over 26,000 lawsuits, with more than 8,000 students settling out of court at for average penalty of $3,000 each.

While most unversities simply forward the letters as requested by the RIAA, some, like the University of Kansas, have taken the stance that they are not a legal agent of the RIAA and that forwarding the letter would be a violation of the students’ privacy and the Digital Millnnium Copyright Act (the “DMCA”). They refuse to relase information with a court order or subpoena legally requiring them to do so. The safe harbor provision of the DMCA protects Internet service providers, in this case the University, from liability for users’ online activity if they immediately remove or disable a access to identified material in a copyright infringement complaint.

It is uncertain what position Vanderbilt University will take with regard to this issue.

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Entertainment Industry News, Life on the Row, Music Industry, Music Row News, RIAA Litigation

The Future of the Music Industry – the continuing dialogue

There is a very well written blog entry by McQuinn on the blog MCQESQ entitled The Future of the Music Industry. You can read the article in its entirety here, and it is well worth the effort. Crossroads copy2 It attempts with acute perception and finesse to dispel the rampant rumors that the music industry conglomerates are are a dying breed of dinosaurs. The essence of the authors opinion are as follows:

It’s popular to bash the labels (especially the majors) and to celebrate their apparently imminent demise. For me, there is no pleasure in seeing people get laid off and large companies go bankrupt in any industry. But I also dispute the idea that labels (in general) have been a bad thing for music. . . . Without record labels recording and promoting music, we would never have heard of most of the artists that we now recognize as music legends.

I wrote similar sentiments back in 2000 when Courtney Love bashed the very industry which gave her soap box any credibility at all. In the article by Mcquinn, the author is not attempting to defend all record labels nor the actions of all record industry professionals, but successfully points out that without the music industry moguls’ promotion and even love of music, there would be no “superstars” for us to download! There would only be garage bands. Ugh! (no disrespect to any particular garage band intended, but we must realize there is a reason why some bands “make it” and some don’t).

I tell my clients that they should consider the major label to be not only their marketing arm, but a bank! The fact is, a major label will customarily spends upward to 3–5 million dollars to record, advertise, market and promote ONE act. Granted, much of that investment is recoupable from the artists’ royalties (meaning that the artist must pay it back the money back of earned royalaties – the artist doesn’t pay it back if the label cans them), however, it still garners the artist a very valuable commodity: name recognition. How many superstars can you name off the top of your head? Madonna. McCartney. Garth. Prince. Dolly. The Eagles. Elvis. Elton John. I may be dating myself a bit here, but you get the idea – without the record labels, these artists would not have what they have today – the ability to annouce a concert date and sell it out a 200,000 seat venue within hours, for example. Is it totally fair to denounce the industry that helped these artists become the superstars that they are? Is it fair to expect that industry to take no profits from the product we so much enjoy?

So, what about the rumor that the major labels are heading for an imminent demise? A recent article in the September 2007 issue of Country Aircheck entitled Music Sales at a Crossroads – Labels Face the CD’s Swan Song gets a little more specific. The article cites RIAA-compiled data that illustrates that the gross sales of the CD format have diminished by almost one third since 1999, when it was over 14 billion, to 9 billion last year. In the country genre, where the CD format is still a popular one, total sales through September 2007 were 31 million units, whereas the genre tallied a total of 75 million units last year. Overall, total sales of CD for all genres is down 20% over the same time last year, a very significant drop. While I do not believe the music industry is going away, I do believe that the CD format will ultimately be gone. Tower’s demise was a forecast of this inevitability.

In the past, loss in profits from one format meant a rise in profits from another format, as, for example, when the CD format replaced records and cassettes, or when cassettes replaced 8–tracks (for those of you old enough to remember tape-based product). But in today’s market, the sell of digital downloads is not generating enough profilt to offset the loss of profits from the demise of CDs. Why, you might ask? I think all of us know that the reason for this is that the majority of songs being consumed today are either ripped from somone else’s CD or iPod, or they are obtained over the P2P networks. Those methods of obtaining music do not profit the artist, the songwriter, or, of course, the record labels.

McQuinn’s article points out that the label must find alternative methods of making profits, and mentions touring, merchandising and expanded licensing. This is not a new concept as, in fact, I have already started seeing contracts from labels taking an interest in more of the revenue streams than they have in the past. As Joel Galante, chairman of Sony BMG Nashville, points out in the Country Aircheck article, “you can’t have the label engine driving everything and being compensated the way it was before. We are taking most of the risk and there are a lot of revenue streams making money.” The trend in the music industry is for more independent-type deals with the artist in which the artist actually becomes a partner with the label. I also believe that we will see a resurgence of the “single” concept and/or the “mini-album” and a shift away from the 10–12 song album idea.

The music industry will also find reprive in the form of direct-to-retail marketing. The Eagles release through Wal-Mart is only one in a long chain of well-known artist who have found their own path to the retail market — Prince, McCartney, Radiohead, Nine Inch Nails — circumventing the Big Four: Song BMG, Warner, UMG and EMI. These artists are certainly blazing new trails and have been successful. The major labels, however, still maintain that they have the edge when it comes to developing and promoting artists and/or distributing their product. In view of the success of the aforementioned artists, however, this point is certainly not a given anymore.

We are, as I said in earlier articles and blogs, facing a new paradigm in the music industry. The major labels have yet, in my opinion, found the holy grail of digital downloads. What can the labels do to move into the 21st century? The answer cannot be yielding 90% of the market to iTunes. Labels have to take the lead of EMI and UMG and offer their music without any digital rights management — after all, the music on CDs is DRM-free! They must abandon the misplaced trust in “subscription-based” services which require monthly fees. As I have maintained in my ten years of analyzing and thinking about this issue, I believe that they must do what all good entrepreneurs have done: find a price point that will make it foolish for people to download music through a P2P and risk litigation. Sell the product at a reaonsable price. Most people, myself included, want to pay for their music — they just don’t want to overpay for their music. The first configuration of label and online distributor that finds that right combination of value and profit — i.e. the right price point — will be the significant winner in my opinion.

Tags: Digital+Downloads, Music+Industry, Major+Labels, Record+Labels, Entertainment+Industry

Copyright Issues, Life on the Row, Music Law

Tricks of the Trade

The “Star Power” theory of damage reduction in copyright infringement actions

Most consumers instantly recognize brand names such as Coca-Cola®, Nabisco®, Frito-Lay®, and Sony®. As a result of their prior purchasing experience with these brands, a consumer is much more likely to purchase a new brand of cookies bearing the Nabisco®® label than they are a bag of “Fred’s” cookies. This phenomenon is generally Magic known as brand name impact, or brand name recognition, and is the essence of trademark law.

When applied to the entertainment industry, an artist’s brand name impact is often referred to as “star power.” More specifically, star power refers to that portion of an artist’s earnings generated by a particular entertainment product which can be attributed to the entertainer’s success, fame, and the expectations of the artist’s fan base, as opposed to the specific content of the particular entertainment product, e.g., a musical composition. The theory is that a large percentage of consumers who purchase a popular artist’s entertainment product do so on the basis of the artist’s reputation, and on their past experience with that artist, rather than on a preference for any one particular song on that artist’s latest release.

The more astute reader may now be wondering how this principle applies in a copyright infringement action. The answer lies in the text of §504 of the Copyright Act, which deals with the calculation of actual damages in a copyright infringement action. The plaintiff, if he or she proves liability, is “required to present proof only of the infringer’s gross revenue.” Once the gross revenue is established, the burden shifts to the defendant infringer, who is required — and this is where it gets tricky — “to prove his or her deductible expenses and the elements of profit attributable to factors other than the copyrighted work.” 17 U.S.C. 504(b) (emphasis added).

Star power is one of the more important “elements of profit attributable to factors other than the copyrighted work” used by defendant-artists who have significant “brand name impact” to reduce the amount of damages to be awarded in a successful copyright infringement action against them. If the jury finds, for example, that the actual damages in a copyright infringement action involving an internationally known artist total $1 million, and further finds that fifty percent of the profits generated by the infringing song are attributable to the artist’s “star power,” then the copyright owner would only be entitled to $500,000.

One of the first applications of this sort of reduction for star power of an entertainer was in the case involving George Harrison’s subconscious infringement of the Chaffon’s 1963 classic hit He’s So Fine with his equally successful composition, My Sweet Lord. For more information, see, ABKCO Music, Inc. v. Harrisongs Music, Ltd. (1981, SD NY) 508 F Supp 798 (apparently 1909 Act), mod on other grounds, and remanded (CA2 NY) 722 F2d 988, 221 USPQ 490, later proceeding on other grounds (CA2 NY) 841 F2d 494. In that case, the court held that 75 percent of the success of the infringing song was attributable to the plagiarized music, while 25 percent was attributable to other factors including, among other things, the popularity and stature of Harrison in the pop music industry.

In order to calculate the percentage of sales attributable to star power, a defendant usually will hire a damages expert to apply elaborate formulas to the sales data of the infringing artist in order to derive an applicable percentage. The expert may, for example, perform nonlinear regression analysis to compare the sales of the more recent album containing the infringing musical composition to the sales from one of the artist’s earlier album, usually the first release, over an extended period of time (as many as 4-5 years). We’ll call this percentage the “Star Power Percentage.”

So, you might think to yourself, the calculation is simple. If a court determines that the gross profits from sales of the infringing album are 2 million dollars, and that the Star Power Percentage is 50%, then the copyright owner would be entitled to 1 million dollars, right? Wrong!. Just when you think you’ve got the trick figured out, the infringing artist has one more trick up the sleeve!

Instead of applying that Star Power Percentage to the gross profits from the sale of albums containing the infringing composition, the defendant will apportion out only those portions of profits that are directly attributable to the infringed musical composition and then apply the Star Power Percentage only to that apportionment. Again, you might think this calculation is straight forward. If there are 10 songs on the album, one manner of calculation would be to apply the Star Power Percentage to 1/10th of the earnings from the album. In the example given, 1/10th of 2 million is $200,000, and the plaintiff would be awarded 50% of that, or $100,000. Wrong again!

A typical damages expert will base the apportionment of earnings from an album on the performance royalties generated by each musical composition. The expert will apply the respective performance royalty total for each musical composition to the total earnings to derive the allocated percentage of profits attributable to each individual musical composition. If the infringing song happens to be a very popular song, that might be beneficial to the plaintiff. If, however, the infringing song is less popular, it probably means that the Star Power Percentage will be applied to less than 1/10th of the total earnings from an album containing 10 songs.

The good news is that the infringer bears the burden of proving these types of deductions. One factor that weighs heavily in favor of a lesser deduction is the degree of popularity of the infringing musical composition. If the infringing musical composition is extremely popular, a good argument could be made, through the use of plaintiff’s expert testimony, that the musical composition itself contributed a great deal to the success of the album.

Another important factor is the popularity of the musical composition that has been infringed. In the Harrison case, for example, He’s So Fine was an extremely successful musical composition in 1963. The inference is that even though George Harrison’s star power may have attributed some percentage to the sales of the infringing composition, the familiarity of the melody could arguably be said to have contributed as much or more to the sales and, therefore, the effects of star power are diminished.

When calculating damages, the defendant will most certainly make use of every means available to reduce the amount of damages to which the songwriter/plaintiff is entitled. The songwriter, therefore, should make use of a good copyright infringement attorney and a reputable musicologist to make certain that his or her rights are protected and to make certain that he or she gets the full extent of the damages to which he or she is entitled.

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Internet Law, Life on the Row, Music Industry, Music Row News

The Digital Lowdown: What’s a good deal?

The author, Steven Corn is the co-founder of Big Fish Media, a digital music distribution company working with all the major download music services like iTunes, eMusic and Napster. He is the author of the blog, The Digital Lowdown. This article appeared in Issue 32 of Royalty Week, dated October 9, 2007 and is reprinted here with the permission of the author.

Recently the CEO of Vivendi, Jean-Bernard Levy, called the deal between Apple and its music providers “indecent” and complained about the lack of a differentiated compensation structure. His simple, yet bold, comment reflects the primary complaint that the major record labels have with the iTunes business model. They feel that they are not getting paid enough and they want a better deal from iTunes. As a provider of over 50,000 tracks to iTunes (and other services), one might think that I would agree with his viewpoint. However, his statements are flawed and represent a desperation that pervades the music industry today.

Referring to the iTunes deal as “indecent” is nothing short of a hyperbole. When a UMG CD is sold for $13.99, the distributor generally receives about $9.99. The record label would probably receive $5 – $6 per CD. (Note: these figures vary greatly from album to album and distributor to distributor. This estimate is admittedly rough but serves merely to give a general idea of the revenue splits for selling CDs.)

If the CD being sold is a Universal Music Group artist and the distributor is Universal’s own company, then Vivendi can claim to earn about 70% of retail sales. This is remarkably similar to the wholesale price of an iTunes sale. If a particular CD is an older catalog item, the distributor might offer it at a discounted price. This is reflected in CD sale prices ranging from $9.99 – $11.99. The wholesale on such sales will still remain about 70%.

So, it is unclear how Mr. Levy is calculating his math when he calls the splits on iTunes “indecent.” In many industries, a 70% wholesale price would be considered quite good.

I suppose that a counterargument would be that iTunes makes a lot of money selling iPods and the labels do not share in those revenues (not for any lack of trying on their part). And yet, a supplier of socks to Wal-Mart does not make money when Wal-Mart sells shoes. I suspect that the wholesale price for goods in Wal-Mart, a company notorious for having very slim margins, is no better than 70% and quite possibly much worse.

The battle between iTunes and Vivendi is certainly heating up. The labels are, no doubt, greatly concerned with the large market share that iTunes has and relinquishing control has never been a trait of the majors. For many labels, iTunes is becoming their number one retailer topping even Wal-Mart and other big box stores. If the digital marketplace was more diverse with less concentration in one retailer, then it is likely that the labels would be less critical of the wholesale pricepoint on iTunes.

It is interesting to note that Mr. Levy’s comment occurred on the same day as the beta launch of Amazon’s eagerly awaited download store. While Amazon does offer a multi-tiered pricing structure, their wholesale percentages still closely resemble iTunes. Furthermore, the revenue split on competing services like Napster, Rhapsody and Zune are even less favorable than iTunes. These services appear to escape Mr. Levy’s wrath due, I would presume, to their small market share when compared to iTunes.

So, is it the deal that is indecent? Or is it the fact that Vivendi can’t seem to find effective ways to counteract the decline in physical goods? Perhaps it is the basic fear of the power that iTunes wields.

When a market is declining, as CD sales are, it is natural for large companies to maximize their other revenue streams. Consistent with the Wal-Mart analogy, many companies feel the pressure of meeting their targeted price points and margins. And yet, it is very hard to ignore such a major retail outlet, regardless of what products you manufacture. If Vivendi decides to pull out of iTunes, I am sure that most any indie label would be happy to step in and offer their albums for the same banner slots that UMG has secured in the past. Perhaps some consumers will be upset that they cannot buy both a Nine Inch Nails (UMG) and an Artic Monkeys (WMG) track on the same store. But I doubt that it would greatly affect the general appeal of iTunes. Mr. Levy’s comments sound like a game of “chicken” where no one really cares who wins.

Tags: Digital+Downloads, MP3, music+law, copyright, music+industry, universal+music+group, vivendi, record+distributors

Life on the Row, Music Industry, Music Row News

The Eagles release new album and slated to appear on CMT Awards

-EaglesLongRoadOutOfEden After almost thirty years, my favorite band of all time, The Eagles, have recorded a new album entitled Long Road out of Eden, which features the single “How Long.” The song is climbing the Billboard country chart and currently resides at No. 26. The new single was originally written and recorded by J.D. Souther in 1972 on his self-titled album, Long Road is scheduled for release on October 30, 2007, exclusively through Wal-Mart and online at musictoday.com. To quote another seventies powerhouse band, Led Zepplin, it’s been a long time, been a long time. . . .

In connection with the success of the band’s single on country music radio, The Eagles are slated to perform during the 41st Annual Country Music Association Awards airing Wednesday, November 7 on ABC at 7 p.m. CST. The awards show, back in Nashville after a controversial hiatus in New York. The band is also premiering at the new Nokia Theater L.A. Live with the Dixie Chicks on October 18 and 20.

The Eagles’ country-flavored rock style has always appealed to country audiences, as witnessed by the fact that one of their notable hits, “Lyin’ Eyes” reached No. 8 on the country charts in 1975. Don Henley has recorded in Nashville, and was nominated for a CMA award in 1992 for his duet with Trisha Yearwood on the song “Walkaway Joe.” In addition, a 1994 tribute album, “Common Thread: The Songs of The E Eagles2 agles,” won CMA album of the year.

The Eagles in their various configurations have sold more than 120 million albums worldwide, earning five No. 1 U.S. singles and four Grammy Awards. Their “Greatest Hits 1971-1975” is the best-selling album of all time, exceeding sales of 29 million units. In 1999, RIAA honored the album as the The Best Selling Album of the Century. Their album, Hotel California, has sold over 16 million units since its release in 1976.

The Eagles currently consists of Don Henley, Joe Walsh, Glenn Frey and Timothy B. Schmit, who replaced Randy Meisner after the blockbuster Hotel California album. Other past members of the band include Bernie Leadon, one of the original members from 1971–1975, and Don Felder, from 1974–1980.

Tags: The+Eagles, music+industry+news, music+row+news, entertainment+industry+news, CMA+Awards

Life on the Row, Music Industry, Music Row News

New independent label on Music Row

Radiance

Florida businessmen, David Lowman, Bobby Land, and William Whitacre have announced the establishment of Radiance Records, a new independent country record label.

Lowman’s music industry experience includes fifteen years as a recording and performing artist. Land grew up in Tennessee, graduated from Belmont University, and was signed as an artist with Hickory Records in Nashville before going on to become a producer. William Whitacre is an entertainment attorney based at Universal Studios in Orlando. His client list includes film, television, and record producers, artists, and Internet/multimedia clients. Whitacre launched Cheetah Records and has produced films starring Ernest Borgnine, Mickey Rooney, and Danny Glover.

Mr. Lowman is serving as Radiance’s president, alongside music business veteran Billy Holland, who will be the general manager. Land will act as vice president of the label.

Holland’s background includes development and management of sales territories for Fortune 500 and Global 1,000 companies including Simplex/Tyco and Minolta Corp. Most recently, Holland was Executive Vice President of Cupit Records.

“I am thrilled and excited to be part of Radiance Records. I look forward to many great things to come,” Holland said.

The first act signed to the new label is BlackHawk, a country music band from the 80’s known for such hits as “Goodbye Says It All” and “Postmarked Birmingham.” The group includes original members Henry Paul and Dave Robbins. They have just completed work on their new album with Nashville-based producer Dale Oliver which is set for release in 2008.

Lowman and Land formed Radiance Records to take advantage of current opportunities for independent labels. Lowman noted ,”We feel the time is right for another aggressive independent label to make its mark in the country music format. We’re really excited to be involved with Country music, and especially thrilled to be starting off with a proven hit-maker act like BlackHawk.”

The label’s offices are located at 38 Music Square East, Nashville, TN 37203. The telephone number is 615-255-8404. For more information about Radiance Nashville, please visit www.RadianceNashville.com.

Tags: Music+Row, music+industry+news, entertainment+industry+news, nashville+news

Entertainment Industry News, Life on the Row, Music Industry, Music Row News

The new paradigm of music has arrived!

Law on the Row used to be a periodic newsletter in the physical world that I would send to my clients and mailing list. In the first edition of Law on the Row, published September 9, 1999, I published an article on digital downloading entitled “To MP3 or not to MP3? The catalyst for a paradigm shift in the recording industry.” That article was a harbinger of the paradigm which is still melding in the music industry even now. The focus of this blog is where are we now?

There is a lot of discussion on the web and in the print press these days about the overall health of the music industry, including an article entitled “What’s the future of the music industry” published just last week in the New York Times. The article points out the Nielson statistics for albums sales which indicate that sales have fallen 18% from 2000 to 2006. Certainly, everyone in the music industry appreciates the downturn in sales, however, as the article also points outs, sales in other industries are also proportionately down , such as new cars which have declined 22% over the same time period. Also, downturns in the music industry are certainly not atypical, and the digital download phenomenon is not the culprit of our current downturn.

I have always believed, as I still do, that people are essentially honest and want to pay for things they enjoy. I believe that people do not mind paying for something of value, including music! The success of iTunes, emusic.com, and all of the Russian download sites are indicators of the validity of my belief. Yes, there is illegal activity. Inevitably there will be people who abuse the system and will seek to get something for nothing. But the average person just wants value.

I support the artists and songwriter’s rights to be paid for their time. I even believe that a record label should recieve financial remuneration, even profit, for the marketing, promotion and distribution efforts involved. The simple fact is that people will not work if they do not get paid. If people stop getting paid for music, music as an industry will cease to exist.

Returning to the idea of value for effort, the author the NYT article reminisces about the historical “single,” an idea which deserves some consideration. I remember going to a record store and looking at all of the singles displayed on the wall and picking one or two of my favorites. The beauty of that system was that you got value for your money — you selected the music you for which you were paying. In contract, with the industry’s current “record album” paradigm, you have to pay for 8–9 songs for which you don’t care. Credit digital downloading for bringing back the “single” paradigm.

But again, people want value even for this paradigm. Most people I talk to insist that 99 cents for a single may be too much money. Most people feel that somthing along the lines of 25–40 cents is an appropriate price point. So, in essence, in considering everyone’s interest, including the songwriter, publisher, distributor (and/or record label) and artist, the question become how much are people willing to pay for a digital single to compensate the varying parties for their considerable effort.

The second component, in my opinion, of value for my money is DRM-free music. People want their music to be free of any restrictions. Any form of digital rights management has to be incorporated into this new paradigm. Finally, selection is imperative. People want variety. Apple has only around 500,000 or so songs in their current catalog. This may seem sufficient until you realize that peer-to-peer networks generate catalogs in the millions!

So, how will the new paradigm work? The Electronic Frontier Foundation proposes voluntary collective licensing, which is to say that “the music industry forms a collecting society, which then offers file-sharing music fans the opportunity to “get legit” in exchange for a reasonable regular payment, say $5 per month.” This is, of course, similar to the current method of collecting performance royalties by such giants as BMI, ASCAP and SESAC, as well as a multitude of foreign performance rights organizations.

The collective licensing system is certainly a valid model, however, there are some disadvantages to consider: first, with the risk of overgeneralizing, I note that these models typically favor, again, the players with the most power, i.e., the mega-conglomerates – not the independent artists and songwriters. Secondly, the subscription method favors the supplier, not the demand. Like most consumers, I personally do not like the “subscription-based” model. I don’t like being obligated to a monthly fee, even if I can cancel it. I want an ad hoc pay-as-you-go system — more like iTunes and less like eMusic.

My personal prediction of how the new music paradigm might shake out is dependent upon the efficiency of search engines and indices on the Internet. As the online community of music lovers grows, so does the online community of music providers. Independent producers can sieze the day in many ways. Myspace.com is evidence of this phenomenon. but as anyone will tell you, the old addage of “build a better mousetrap” does not apply in the online world. It less like looking for needle in a haystack and more like trying to find a dime on the ocean floor.

There are certainly headways being made in this arena: take the free Internet radio service, Pandora, as an example. At this innovative site, people find new music similar to the music being played by Pandora’s web-based radio that is based on their selection of favorite music. Another innovative search site is LivePlasma, which displays a graphical sytem of color-coded bubbles that are more or less related to your favorite artists. As more of these types of search engines become available and intergrated into the Web, it will be easier for independent artists and producers to get their music heard. For a much more detailed analysis of this idea, read Chris Anderson’s important book, The Long Tail. Once that happens, the paradigm shift from major labels to independents will be complete.

Tags: Entertainment+Law, Digital+Downloads, MP3, Music+Law, Music+Row, DRM

Life on the Row, Music Row News

UMG to move off of Music Row

Suntrust

Luke Lewis, Chairman of Universal Music Group here on Music Row, announced yesterday that the company will be relocated to the new SunTrust Plaza at 401 Commerce Street in downtown Nashville, right next door to the famous Ryman Auditorium.

UMG follows Other Nashville labels that relocated to locations in Nashville other than Music Row: Lyric Street Records, located on Demonbreun, and Capital Records, located on West End.

Reactions of other Music Row residents to the exodus of this powerhouse are reported as being mixed in the Tennessean article entitled Universal will leave Music Row for downtown. Harold Bradley, president of the musician union, is credited with the formation of Music Row in 1954 together with his brother Owen. Mr. Bradley describes the move as “sad news” and as “breaking the ranks.” He remembers a Music Row where walk-about traffic was the way business was done.

Mr. Bradley knows first hand that the country music industry has always been a tight-knit community, somewhat segregated from the “suits” downtown. Not that we aren’t an integral component of Nashville’s business community, but we always did business differently – in a more lay-back fashion. The standard line when making an appointment was, do you want my morning slot or my afternoon slot?

But the country music industry has changed tremendously over the last ten years or so. Nashville is no longer a handshake town. It’s a subisidiiary town. No longer are most of the major decisions about potential artists made on Music Row – the chances are they are made in New York, Japan or Germany. Perhaps this trend to move off the Row is just a reflection of how business is done these days. So, I agree with Harold, it is sad.

Tags: Entertainment Law, Music Law, Music Row, Nashville

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Life on the Row, Music Row News

SpiralFrog continues to expand catalog

Spiral Frog

The New York-based online music site, SpiralFrog is continuing to grow its catalog of freely downloadable songs. SpiralFrog describes itself as “a Web-based advertising-supported music experience that combines music discovery tools with free and legal downloads of audio and video content.”

Music Row’s own Frances Preston (see my earlier blog regarding her recent award) sits on SpiralFrog’s Board of Directors.

In the past several months alone, SpiralFrog has inked deals with the likes of Universal Music Publishing (8/30/07) and more recently INgrooves, a subsidiary of Isolation Network, Inc. (9/12/07), a digital media distribution and publishing company.

The aggressive expansion gives SpiralFrog subscribers free access to approximately 900,000 songs and videos. Although free, the music has severe limitations, namely, it cannot be played on either the iPod or the Zune, cannot be played on an Apple computer, cannot be burned to a CD, and can only be transferred to up to two of the Windows DRM-approved devices. Finally, NO MP3 format!

This business model proves once again that many executives in the fledgling online music industry do not understand how the consumer wants to use their music. The music must be unfettered! The average consumer is more than happy, in my humble opinion, to pay a fair price (no, not 99 cents Apple!) to purchase and download a song provided that it is not restricted in any way.

While I’m on the subject of restrictions, I might point out that music downloaded to iTunes often falls into this category. The popular software from Apples is quirky, buggy and bloated. Again, if I purchase music, I want it unfettered. I don’t want to be locked in to a really bad piece of programming such as iTunes.

Until a company finds a business model that really provides such unfettered access, they will not succeed. The closest solution I’ve found so far is eMusic.com. All music downloaded from eMusic is MP3 and DRM-free. Of course, because of its business model, eMusic is unable to ink licensing arrangements with most major distributors.

I’d really like your comments and opinions on ths issue.

Tags: Entertainment Law, Frances Preston, Music Law, Music Lawyer, Music Licensing, Music Row, Nashville, SpiralFrog