The Music Publisher - A greedy bunch !
Was it not at one time - when publishers still printed sheet music -that in that way it made a tune become 'popular' ?
That's what Karaoke could have achieved. Not anymore in the US. The publishers killed that segment of the business.          By Greed !

If one were to try and release a Karaoke CD, there are 4 (four) kinds of licenses involved:

1. The use of the Instrumental version

2. The use of the vocal version

3. Payment for Lyrics

4. Payment for graphics

This mostly totalls a whopping 25 cents per Track + all the other costs. Hence, nobody touches this segment of the market anymore.

THE ABOVE WAS WRITTEN IN MAY OF 2002
Now, in February of 2003, we feel that this site needs an update, because despite the billons of dollars the industry has lost, the shooting match (the one aimed at the foot) still gains in popularity. Recent developments indicate a downward trend and the resulting tendency to surrender to 'each other' by means of planning to either outsource divisions (see BMG /Cdnow /Amazon)or maybe toying with the idea to place the entire music division in other hands (BMG>EMI), or selling that whole division. (AOL-Time -Warner)

Cool Idea ! :)

While it seems that the consumer himself got tired of bending over and the music it was being served along with the artificial images called artists, the industry continues to show the flexibility of a medium sized turtle when staring in the headlights of an approaching freight train.

Don Henley's claims against Clear Channel may be very valid ! But they are only the tip of the Iceberg.

Payola has taken on various forms since the highly publicized scandals of the 1950s and '60s, when rock 'n' roll DJs received direct payments from labels to play songs, prompting federal laws forbidding such direct practices.
In in simpler terms: The players have changed

In its current form, there are two payolalike practices.
1. Radio stations enter exclusive arrangements with independent promoters who guarantee the station a fixed monthly or annual payment. In return, songs "suggested" by such an independent promoter are the most likely to be added to playlists. This practice is allegedly used by Clear Channel and Radio One.
2. The second de facto payola practice occurs when many legitimate independent promoters hired by the labels use the labels' money to pay for airplay.

Ask anyone in the industry about Jeff McClusky & Associates ...

This one is funny:
In October 1992, the U.S. Congress passed the Audio Home Recording Act. Under the AHRA, manufacturers and importers of digital audio recorders (including, for example, DAT, DCC, and MiniDisc recorders) and blank media are required to make royalty payments. The AARC was the first organization to distribute AHRA monies in 1995. The royalty rate was established through arbitration, and is currently at 2% of manufacturers' revenue .

Q: Now, who Collects this Tax?
A: The AARC (Alliance of Artists and Recording Companies)
Q: Where are they ?
A: AARC shares office space with the RIAA.
Q: Who are they ?
A: The RIAA is a lobbying group based in Washington D.C. to promote the agenda of the Major Labels (membership fees are based on sales, so that small labels may be a member but have little clout or say). Still headed by the now outgoing Hilary Rosen.

The AARC claims to represent 20,000 artists and record companies but we have not been able to find one artist that was paid a cent of the money. Still looking though

In addition every CD recorder has a $2.00 surcharge built into the price that goes directly to the RIAA

----

Janis Ian (singer, songwriter and recording artist with nine Grammy nominations) wrote the following article for the Times:

Don't Sever a High-Tech Lifeline for Musicians

The Recording Industry Assn. of America recently won a court ruling that effectively will cut off the recording artists it represents from new listeners.

In RIAA vs. Verizon, the U.S. District Court for the District of Columbia ruled that anyone suspected of downloading so-called "infringing" files on the Internet -- usually an MP3 of a song -- could be sued. No evidence is required. An accuser fills out a form for a court clerk and the machinery is set in motion.

The record companies say this decision will mean more money for musicians, but they have it backward. The downloaded music they're shutting off actually creates sales by exposing artists to new fans.

If this ruling stands, many smaller musicians will be hurt financially, and many will be pushed out of the music business altogether.

I've been a recording artist for nearly 40 years, with top-selling songs such as "Society's Child," "At Seventeen" and "Jesse." Six months ago, I began offering free downloads of my songs on my Web site. Thousands of people have downloaded my music since then -- and they're not trying to steal. They're just looking for music they can no longer find on the tight playlists of their local radio stations.

That's how many artists gain new listeners these days -- through the Internet.

After I first posted downloadable music, my merchandise sales went up 300%. They're still double what they were before the MP3s went online.

I'm not going to make a fortune selling these extra recordings, but it does add up to a few thousand dollars a year. That's a welcome bit of additional income for me and for the vast majority of artists who don't sell as many records as Nelly and Ja Rule.

The Internet means exposure, and these days, unless you're in the Top 40, you're not getting on the radio. The Internet is the only outlet for many artists to be heard by an audience bigger than whoever shows up at a local coffeehouse. The Internet allows people like me to gain new fans; if only 10% of those downloading my music buy my records or come to my shows, I've just gained enough fans to fill Carnegie Hall twice over.

With the court's decision, the RIAA didn't just defeat Verizon, the Internet service provider that the RIAA sued. It damaged the viability of recording artists who don't conform to the mainstream musical tastes of the moment.

Do you like '50s-style acoustic folk? Big band music? European synth? If the decision stands, you'll have to rely on word of mouth to find it -- not the Internet. Because if you get hold of an "infringing" file, you may find yourself on the receiving end of a record company lawsuit too expensive for any individual to fight.

The entertainment industry has a long history of trying to shut down new technology. Most often, it has imagined that new products and services threatened industry sales. It's been proved wrong time and time again; it fought home video tooth and nail, but videotapes and rentals now bring in more money than movie releases. Music history is littered with record industry campaigns against reel-to-reel home tape recorders, cassettes, minidiscs, music videos and MTV.

Verizon is appealing the decision, and it is vital that the judge's ruling be overturned.

The RIAA says it is doing all this to make more money for me and other artists like me, but don't be fooled. Many musicians would lose money, many fans would be denied a universe of new choices and the possibilities of Internet music would be cut off before the revolution even begins.

has this out today:

The Year The Music Dies

Record labels are under attack from all sides - file sharers and performers, even equipment manufacturers and good old-fashioned customers - and it's killing them. A moment of silence, please.

By Charles C. Mann

Not long before his sudden death from a heart attack, I saw Timothy White at a party in Boston, standing by the bar in his usual bow tie and white bucks. When he waved me over, I was delighted: Timothy was not only the editor of Billboard but a respected music critic and biographer. Even the executives he often took to task conceded, with a wince, that he understood the secretive, confusing business better than almost anyone. "How much you want to bet that the entire music industry collapses?" he asked me. "And I mean soon - like five, ten years. Kaboom!"

Truth is, it may happen even sooner. This year could determine whether the music business as we know it survives.

In the first six months of 2002, CD sales fell 11 percent - on top of a 3 percent decline the year before. Sales of blank CDs jumped 40 percent last year, while the users of Kazaa, the biggest online file-trading service, tripled in number. Meanwhile, the labels' new legitimate online music services attracted fewer paying customers than the McDonald's in Times Square.

As recently as 10 years ago, the media conglomerates that own record labels regarded them as cash cows - smaller than Hollywood but more reliably profitable. Now all five major labels are either losing money or barely in the black, and the industry's decline is turning into a plunge. In the next year, whether together or separately, the labels will have to set about totally reinventing the way they do business, a horribly difficult task for any institution.

To leap the hurdles posed by digital technology, the industry must find a way to make money selling downloaded music on a per-track basis, allow in-store CD burning, slash recording costs with cheap software and hardware, and change artists' contracts to reflect the new economic reality. Doing any one of these will be next to impossible. Doing all of them would be one of the more amazing turnarounds in business history.

The record labels blame piracy for their woes. And they're right - in part. Before writing this paragraph, I logged on to Kazaa. At 10 on a Monday morning, hardly peak time, 3.1 million people were on the network - more simultaneous users than Napster ever had in its heyday.

At least a hundred copies of every song on the Billboard Hot 100 were available for download. So were 13 out of 15 tracks on Mariah Carey's new CD, which wouldn't hit stores for another three weeks. And that's not even counting the discs sold on every street corner from the Bronx to Beijing.

The industry rightly believes that if it can make file-swapping more difficult, and legitimate online services easier and less expensive, it can turn the kids on Kazaa into paying customers. Pursuing this two-pronged approach, the companies are spending millions on their own Internet services (pressplay from Universal and Sony; MusicNet from BMG, EMI, and Warner), on lawyers to chase away pirates and peer-to-peer networks, and on anti-piracy ads featuring the likes of Britney Spears.

But this won't be enough. To survive, the industry will need the active assistance of friends it doesn't have. The labels may be able to kill Kazaa, but they won't be able to stop even more decentralized networks like Gnutella without help from Internet service providers, cable operators, and telephone companies. All their efforts to get DVD-like protection for CDs ultimately depend on the goodwill of hardware manufacturers and Capitol Hill. The online subscription services will flounder without cooperation from performers, songwriters, and record stores. And the ability of Britney to change the hearts and minds of music fans depends on public sympathy.

That sympathy is in short supply. Rightly or wrongly, record companies are detested by politicians (for corrupting youth), by webcasters (for demanding royalties), and by their customers (for inflating prices). Musicians and songwriters are famous for loathing the labels, and many have resisted licensing their songs to MusicNet and pressplay. (Both are under investigation for possible antitrust violations.) Radio and MTV aren't in the industry's corner; the labels, through "independent promotion" programs, effectively have to pay them to broadcast music. And the electronics industry's attitude toward the labels is summed up by an Apple slogan: Rip. Mix. Burn. Which, a music executive once told me, translates into "Fuck you, record labels."

Even the music trade's corporate masters are torn. Until the 1980s, most labels were controlled by eccentric, sometimes thuggish entrepreneurs who had their whole lives bound up with selling albums. In the past two decades, every big label has been swept up into one of five major groups: Universal, Warner, Sony, BMG, and EMI, which together control about 75 percent of global recorded-music sales. Despite their dominance, though, the majors are merely duchies in large media empires with other, often conflicting, priorities.

Last year, the Big Five together sold about

$20 billion worth of music. Meanwhile, Sony alone saw about $42 billion in electronics and computer sales. If Sony wants to sell MP3-capable cell phones - a big thing in Japan and potentially worldwide - how much attention will it pay to Sony Music's protests?

Similarly, AOL Time Warner is desperately trying to resuscitate AOL by selling high-speed Internet access. Yet one of the main uses for high-speed connections is downloading free music - something that Warner Music sees as a deadly threat. Bertelsmann, the German media titan that owns BMG Music, cared so little about its music division that the company invested millions of dollars in Napster, accepting along the way the outraged resignation of its two main music executives.

Worse, at a time when bold thinking is required, the industry, once the province of entrepreneurial risk-takers, is increasingly managed by bean counters focused on short-term survival. Too often, the response to problems is throwing lawyers and money at them, then ducking responsibility.

Why, when most industries are using technology to slash costs, is Michael Jackson running up $30 million in studio bills? Or, rather, why is Sony Music letting him? Career protection. By using the hottest producers and recording studios, executives can deflect failure ("We got the Neptunes, what else could we have done?") and allay their fears artists will blame them for a flop ("That track would've got some air, but the Suits wouldn't shell out $50,000 to clear the Zeppelin sample"). Because the costs are billed against the musicians, there's little incentive to save money.
------------------------------------------------------------------------

NOW IT GET'S REAL GOOD:

The Publishers Got The Munchies

Bertelsmann sued for $17 bln for Napster link
Reuters, 02.20.03, 12:08 PM ET

NEW YORK, Feb 20 (Reuters) - The music publishers behind hits such as "Jailhouse Rock" and "Unchained Melody" have filed a lawsuit against media group Bertelsmann AG [BERT.UL] over its investment in music-sharing service Napster, seeking damages of $17 billion.
According to the complaint filed on Wednesday in the Southern District of New York, the music publishers allege that German-based Bertelsmann contributed to the widespread infringement of copyrighted music by users of the now defunct Napster.
A Bertelsmann spokesman in Germany declined to comment, adding that the company could not even confirm that it had been notified of the suit.
Bertelsmann invested more than $80 million in Napster with the aim of launching a legitimate version of the online music sharing service. But Napster filed for Chapter 11 bankruptcy in June 2002 and most of its assets were later bought by CD-burning software maker Roxio Inc. (nasdaq: ROXI - news - people).
Napster became one of the hottest properties on the Internet in the late 1990s by letting music lovers swap songs for free. But the company was forced offline in 2001 after record labels sued Napster for copyright infringement.
Plaintiffs named in the New York lawsuit include songwriters Jerry Leiber and Mike Stoller who defined the R&B and pop charts in the early 1960s, penning such megahits as "Hound Dog" and "Stand By Me," with Stoller supplying the catchy music and Leiber the cheeky lyrics.
Publishers Frank Music Corp. and Peer International Corp., represented by The Harry Fox Agency, also are named plaintiffs in the case. The group is seeking "statutory damages in an amount not less than $17 billion."
The lawsuit also seeks class action status to represent all music publishers whose songs were swapped on Napster.
By throwing Napster a lifeline, the lawsuit claims Bertelsmann "remarkably, did not condition its funding on Napster's stopping its infringement" of music publishers' rights.
Copyright 2003, Reuters News Service
-------------------
Here a word about the current copyright extension turmoil:

If you invent a drug like PROZAC your copyright protection is 15 years ( varies between 12 - 20) - Rightly so , would you not agree ?

But for music 75 years ???

And the other interesing one in cases like Irving Berlin or George Gershwin is that i.e. when the copyright was going to run out , Ira Gershwin came out the woodworks (48 years after the fact) and claimed to have co-written the tunes. Hence, the copyright got extended...

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May 2003

NOW THE INDUSTRY IS GOING TO RESORT TO HACKING AND SPAMMING ! WILL THE RESULT BE AN ALL OUT WAR OF THE HACKERS ?

According to an article in the New York Times by By ANDREW ROSS SORKIN :
Software Bullet Is Sought to Kill Musical Piracy

"Some of the world's biggest record companies, facing rampant online piracy, are quietly financing the development and testing of software programs that would sabotage the computers and Internet connections of people who download pirated music, according to industry executives.

The record companies are exploring options on new countermeasures, which some experts say have varying degrees of legality, to deter online theft: from attacking personal Internet connections so as to slow or halt downloads of pirated music to overwhelming the distribution networks with potentially malicious programs that masquerade as music files.

The covert campaign, parts of which may never be carried out because they could be illegal under state and federal wiretap laws, is being developed and tested by a cadre of small technology companies, the executives said.

If employed, the new tactics would be the most aggressive effort yet taken by the recording industry to thwart music piracy, a problem that the IFPI, an industry group, estimates costs the industry $4.3 billion in sales worldwide annually. Until now, most of the industry's anti-piracy efforts have involved filing lawsuits against companies and individuals that distribute pirated music. Last week, four college students who had been sued by the industry settled the suits by agreeing to stop operating networks that swap music and pay $12,000 to $17,500 each.

The industry has also tried to frustrate pirates technologically by spreading copies of fake music files across file-sharing networks like KaZaA and Morpheus. This approach, called "spoofing," is considered legal but has had only mild success, analysts say, proving to be more of a nuisance than an effective deterrent.

The new measures under development take a more extreme - and antagonistic - approach, according to executives who have been briefed on the software programs.

Interest among record executives in using some of these more aggressive programs has been piqued since a federal judge in Los Angeles ruled last month that StreamCast Networks, the company that offers Morpheus, and Grokster, another file-sharing service, were not guilty of copyright infringement. And last week, the record industry turned a "chat" feature in popular file-trading software programs to its benefit by sending out millions of messages telling people: "When you break the law, you risk legal penalties. There is a simple way to avoid that risk: DON'T STEAL MUSIC."

The deployment of this message through the file-sharing network, which the Recording Industry Association of America said is an education effort, appears to be legal. But other anti-piracy programs raise legal issues.

Since the law and the technology itself are new, the liabilities - criminal and civil - are not easily defined. But some tactics are clearly more problematic than others.

Among the more benign approaches being developed is one program, considered a Trojan horse rather than a virus, that simply redirects users to Web sites where they can legitimately buy the song they tried to download.

A more malicious program, dubbed "freeze," locks up a computer system for a certain duration - minutes or possibly even hours - risking the loss of data that was unsaved if the computer is restarted. It also displays a warning about downloading pirated music. Another program under development, called "silence," scans a computer's hard drive for pirated music files and attempts to delete them. One of the executives briefed on the silence program said that it did not work properly and was being reworked because it was deleting legitimate music files, too.

Other approaches that are being tested include launching an attack on personal Internet connections, often called "interdiction," to prevent a person from using a network while attempting to download pirated music or offer it to others.

"There are a lot of things you can do - some quite nasty," said Marc Morgenstern (Son of Jay Morgenstern, Executive Vice President/General Manager of Warner Chappell Music Inc. in Los Angeles), the chief executive of Overpeer, a technology business that receives support from several large media companies. Mr. Morgenstern refused to identify his clients, citing confidentiality agreements with them. He also said that his company does not and will not deploy any programs that run afoul of the law. "Our philosophy is to make downloading pirated music a difficult and frustrating experience without crossing the line." And while he said "we develop stuff all the time," he was also quick to add that "at the end of the day, my clients are trying to develop relationships with these people." Overpeer, with 15 staff members, is the largest of about a dozen businesses founded to create counterpiracy methods.

The music industry's five "majors" - the Universal Music Group, a unit of Vivendi Universal; the Warner Music Group, a unit of AOL Time Warner; Sony Music Entertainment; BMG, a unit of Bertelsmann; and EMI - have all financed the development of counterpiracy programs, according to executives, but none would discuss the details publicly. Warner Music issued a statement saying: "We do everything we feel is appropriate, within the law, in order to protect our copyrights." A spokeswoman for Universal Music said that the company "is engaging in legal technical measures."

Whether the record companies decide to unleash a tougher anti-piracy campaign has created a divide among some music executives concerned about finding a balance between stamping out piracy and infuriating its music-listening customers. There are also questions about whether companies could be held liable by individuals who have had their computers attacked.

"Some of this stuff is going to be illegal," said Lawrence Lessig, a professor at Stanford Law School who specializes in Internet copyright issues. "It depends on if they are doing a sufficient amount of damage. The law has ways to deal with copyright infringement. Freezing people's computers is not within the scope of the copyright laws."

Randy Saaf, the president of MediaDefender, another company that receives support from the record industry to frustrate pirates, told a congressional hearing last September that his company "has a group of technologies that could be very effective in combating piracy on peer-to-peer networks but are not widely used because some customers have told us that they feel uncomfortable with current ambiguities in computer hacking laws."

In an interview, he declined to identify those technologies for competitive reasons. "We steer our customers away from anything invasive," he said.

Internet service providers are also nervous about anti-piracy programs that could disrupt their systems. Sarah B. Deutsch, associate general counsel of Verizon Communications, said she is concerned about any program that slows down connections. "It could become a problem we don't know how to deal with," she said. "Any technology that has an effect on a user's ability to operate their computer or use the network would be of extreme concern to us. I wouldn't say we're against this completely. I would just say that we're concerned."

Verizon is already caught in its own battle with the recording industry. A federal judge ordered Verizon to provide the Recording Industry Association of America with the identities of customers suspected of making available hundreds of copyrighted songs. The record companies are increasingly using techniques to sniff out and collect the electronic addresses of computers that distribute pirated music.

But the more aggressive approach could also generate a backlash against individual artists and the music industry. When Madonna released "spoofed" versions of songs from her new album on music sharing networks to frustrate pirates, her own Web site was hacked into the next day and real copies of her album were made available by hackers on her site.

The industry has tried to seek legislative support for aggressive measures. Representative Howard L. Berman, Democrat of California, introduced a bill last fall that would have limited the liability of copyright owners for using tougher technical counterpiracy tactics to protect their works online. But the bill was roundly criticized by privacy advocates. "There was such an immediate attack that you couldn't get a rational dialogue going," said Cary Sherman, president of the recording industry association. He said that while his organization often briefs recording companies on legal issues related to what he calls "self help" measures, "the companies deal with this stuff on their own."

And as for the more extreme approaches, he said, "It is not uncommon for engineers to think up new programs and code them. There are a lot of tantalizing ideas out there - some in the gray area and some illegal - but it doesn't mean they will be used."

--- More:

Although it looks as though Morgenstern's OVERPEER, on the payroll of Universal and others to send out corrupt files to downloaders, has gone out of business, Marc Morgenstern now seems to be involved with the COVENANT CORPORATION (http://www.covenant-corporation.com), which claims: "With experience in cyber crime, large-scale information systems, and massive online communities, the technical division of Covenant stands ready to deploy a broad range of anti-piracy utilities and tactics"

Covenant Corporation, 50 West Liberty St. Suite 880, Reno, Nevada 89501, founded in May 2002 by CEO Jim Meier, with goals like: "At various times during the protection contract of the track Covenant will randomly pick a username from the list of people who have downloaded that track." and
"Covenant is not responsible for any problems or technical malfunction of any telephone network or lines, computer on line systems, servers, or providers, computer equipment, software, failure or any e-mail or entry to be received by Covenant on account of technical problems or traffic congestion on the Internet or at any website, or any combination thereof, including any injury or damage..."

Morgenstern: "What we do is to make peer-to-peer a lot less fun..." and
"The files they send out are either silent, looped or designed to make a connection time out"

Covenant is recruiting file traders to post bogus files for them on peer-to-peer networks with the promise of cash and prizes.

READY FOR CYBERWAR ? WILL THE INDUSTRY SHOOT ITSELF IN THE FOOT AND ALIENATE MUSIC FANS FURTHER ?

THE RIAA: Unlike much of the activities that take place on P2P sites, "the spoofing of files is perfectly legal", RIAA spokesperson Jonathan Lamy said. "It's happening and it's just one example of a lawful and appropriate self-help measure available to the labels,"

Are the fake MP3s popping up on file-sharing networks part of the recording industry's war on piracy, or just the latest in music marketing?

Is spamming p2p networks with junk files futile in the end?
The very nature of p2p networking is a built-in-repution system where the valuable files stay on the network, and on peoples hard drives, and the bogus files get deleted. Its an up-hill battlet at best.

The "artists" are either too naive to see the value that mp3 swapping can have to building a fan base, or are contractualy obligated to screw their fans in such a manner.
Major labels cannot agree to let kids devour mp3s of their songs all they want- letting the artists get their money at the shows,
The major label indentured servitude and the ever growing indie label scene:
Indepenent labels are doing just fine in the post-Napster world. Why?
These labels have built up a label fan base! Would you buy a record just because it is Warner Brothers? The label becomes a mark of quality, not a top-heavy brand trying to sell you some 'product'.
The Barenaked Ladies did it years ago on Napster, when they were promoting "Maroon."

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