Category: Uncategorized

Pandora at War with Musicians???

So this one keeps getting more and more interesting and worrisome (depending on your viewpoint).  Check out this article from The Verge:  http://www.theverge.com/2013/6/13/4428106/bmi-sues-pandora-calling-radio-station-purchase-a-stunt

We’ll continue to monitor and let musicians and rights holders know what it means for them (other than lower streaming rates).

 

Fiscal Cliff Averted and Section 181 Renewed!

The big news of the day is the narrow escape the country had from falling off the Fiscal Cliff.  Buried within the passed legislation is the long-awaited renewal of Section 181.  The film and television production incentive that has been in limbo since December 31, 2011 was officially renewed and extended through December 31, 2013.

For Hollywood and all independent film and television producers, this marks a huge victory.  Those soliciting investments into qualifying projects such as garcinia cambogia growing and export will be able to offer incentives to investors on top of the remaining state tax credits making film and television productions much safer (obviously still risky) investments.

We imagine that productions that began in 2012 will be grandfathered into the new renewal, but will find out and post any info we get here.  In the meantime, if you or your project need help or have questions about how to implement Section 181 when seeking investment into your qualified film or television project, please contact us at josh@lawyer4musicians.

Here is a link to the American Taxpayer Relief Act of 2012, scroll to Section 317 for the renewal of Section 181.

SOUND EXCHANGE: THE MYSTERY REVEALED

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This Mysterious Castle is said to house all uncollected Sound Exchange Royalties.  Enter at your own Risk!

We here at L4M often make reference to a somewhat mysterious organization known as: Sound Exchange.  However, many people are still confused as to exactly what Sound Exchange does.  We constantly receive questions regarding Sound Exchange so we thought we would give a little primer here.

Prior to 1995 artists and labels did not receive a performance royalty for sound recordings.  On L4M we have stressed the importance of receiving your publishing performance royalties from ASCAP, BMI and SESAC.  However, these organizations only deal with the underlying compositions.  Since 1995 artists and labels, in limited circumstances, are now able to receive royalties for the actual sound recordings.   This has been the norm in most of the rest of the world for a long while now.

The main areas where royalties are available for artists and labels are: 1. satellite radio (think Sirius), 2. internet streaming radio (think Pandora), and 3. cable music only channels (music with no video, think satellite radio delivered by your cable or satellite provider).  Unlike the underlying composition where you have a choice of three performance rights organizations, Sound Exchange is the only organization for your sound recording performance royalties.

So, if a song is played on terrestrial radio only the writers and publishers are entitled to a performance royalty.  If the same song is played on one of the above mentioned avenues, the writer, publisher and now, artist and label will receive a royalty. 

If you are an independent artist that owns your own master recordings it is important that you sign up as both an artist and as a sound recording copyright owner.  This is important because Sound Exchange divides the money as follows: 50% to the copyright owner (usually a label), 45% to the featured artist and 5% to background musicians.  As an independent artist where every dollar counts it is imperative to sign up correctly.  

For some reason there are a lot of artists and labels which are owed money that have not yet signed up with Sound Exchange.  There is no cost to sign up and royalties are paid quarterly.  If you think you may be one of these artists or labels you can search here and check: http://www.soundexchange.com/performer-owner/does-sx-have-money-for-you

We hope this helps clarify what Sound Exchange does.  Now, go check if you are owed money and sign up.  Good luck. 

L4M @ SXSW: The “Interactive” Experience

It’s off to another SXSW for us at L4M.  This year will be the first in 5 where we will not hosting a showcase.  Without necessarily meaning to, we seem to be have identified with a global trend:  Is Southby really worth it anymore? 

There have been numerous editorials, blogs, tweets etc. that have dismissed SXSW as washed up, too corporate, EXPENSIVE, and too cluttered.  I think I agree with the last three.

In preliminary discussions with our partners in Austin it became painfully clear that if we wanted to continue with the L4M showcase at the same magnitude as the years past, we would have to partner (i.e. get money from) several companies and probably become an “official showcase”.  While that was a possibility, partnering and becoming official means that you cannot choose your roster, venue or time slot.  Not sure why we would host a showcase with artists we don’t work with at a location we have not selected ourselves.  If we were just hosting a party to host a party it would make sense, but our purpose has always been to showcase our artists and give them a platform to express themselves in front of an audience of fans and industry folks.  With the number of large companies and sponsors and limited quality venues, our goal seemed unattainable.

This year we are heading down for interactive to see if the popular claim: “You can actually get business done at Interactive” rings true.  So far (after two days) it has become apparent that interactive really means plugged in; as in plugged into any electrical outlet.  While there are amazing entrepreneurs here, it is hard to have an actual conversation with anyone as the vast majority of attendees are “interacting” with their handheld devices, laptops (L4M is guilty of this) or other new dew hickey.   Definitely some cool stuff here, but hard to really feel connected (other than to an outlet).

More to come…

The Spotify Conundrum

Update:  Check out what Coldplay’s Manager has to say about the Spotify Conundrum:  CLICK HERE FOR DIGITAL MUSIC NEWS ARTICLE

To stream or not to stream?  That is the .0007 cents per stream question.

Recently top name bands like Coldplay, The Black Keys and Arcade Fire have spoken out against streaming.  Citing the “gross underpayment” to artists per stream, bands are pulling their music from sites like Spotify or simply prohibiting the placement of their songs altogether.

Let’s look at some projected numbers from streaming on Spotify (courtesy of Digital Audio Insider):

Spotify Per-Stream Payouts August 2009 to March 2011

Smallest: 0.02056 cents
Largest: 1.1456 cents
Average: 0.2865 cents

These numbers are strictly estimates and we have heard that some of the deals that major labels have entered into with Spotify have the per stream at a MUCH lower number then those above.  Regardless, to make some actual money through Spotify, an artist will need millions of streams.  No problem for Justin Beiber and Lady Gaga, but what about the little guy?  Apparently, it’s not just the little guy that is worried/pissed.  As mentioned above, Coldplay and The Black Keys have been very vocal about their overall disdain of streaming providers.  In a recent VH1 interview, The Keys drummer said the following:

“We decided for this album, to not allow streaming services to stream the entire album,” Keys drummer Patrick Carney said.  “It’s becoming more popular, but it still isn’t at a point where you can replace royalties from record sales with royalties from streams.  So it felt unfair to those that purchased the album to allow people to go on a website and stream the album for free whenever they want it.”

Independent labels and artists are outraged with the seemingly enormous underpayment to artists and there are consistent stories of indies pulling their music and catalog from the site.  The question remains however, will their protest pay off or are they really missing out on a new untapped method of reaching millions of fans?

The founders of Spotify continuously hammer home the message that their’s is a music discovery tool.  By having all the published music in one spot, fans will be able to discover deeper cuts or new artists or even new genres of music that they didn’t already appreciate.  Following their logic, once you discover these things your are more apt to actually go out and purchase your new discoveries or better yet, go to a show the next time the “new” band is in town.

From personal experience, I actually tend to side with Spotify (probably not the most popular opinion on this site).  You can stream virtually every song known to man somewhere on the Internet.  Whether it is on YouTube (the new radio for kids), Pandora, blogs, hacker/torrent sites or on artists’ websites, you can typically find a song if you really work Google over for a while.  Spotify puts it all in one handy dandy place for you.  Then it takes it a step further.  In its recently updated version the artists’ radio stations suggest similar music to that of the artist, album or track you originally searched.   I have found this to be a great way (much better than Pandora) to discover new music that I like and then support.

This is not the first time that the music industry has had to deal with a game changer (not even close to the first time).  As we have mentioned ad nauseum on this site, the Internet fundamentally changed the music industry.  Moving at a painfully slow pace, the label infrastructure was not ready for the shift.  Look what happened to them.  Now that the Internet is out of its infancy and new and creative ways to bring music to fans are being created on a daily basis, will the existing labels and, more significantly, the independent artists be ready to play ball?  Or will they stamp their feet and and cry “UNFAIR, DO OVER!”?

Rather than complaining about the system in place and the uber small price per stream (which we agree is way to small and should be changed a bit), we suggest that bands get creative with streaming networks.  Give fans extras and incentives to stream.  Be discovered and it should lead to better results for your music.

Back to Business: Lessons From SXSW and What You Should be Doing

The month long hangover that accompanies SXSW is now, for the most part, lifted.  After successfully schmoozing, networking, hosting events and eating/drinking our way through Austin, we have now had time to compile our notes, compose our thoughts and share with you what we learned from SXSW.  Rather than try to compete with every other industry expert that attends the event by laying claim to which band will be the next one to break or which new music based tech company finally has the equation to success, we found that what has and can set apart a band from the nearly 2000 other bands in attendance is again quite simple:  talent and the band’s “team”. 

Le’t s assume you have the talent part handled (big assumption, but let’s go with it).  Your focus then should shift to making the most of that talent by creating the best team possible.  

Back in what we like to refer to as the “dinosaur age” bands would look to create a team by signing with a separate label, booking agent,  publicist, manager and label.   They hoped this poo-poo platter would lead to a long successful career.  Sometimes it would and sometimes it would not.  However, here in the modern era, things aren’t so simple.  Label staffs are smaller and budgets are next to nothing; thus commissions and profit margins are smaller.

So, what is one to do?  This question not only affects artists but also everyone working in the music industry.  Publicists are often asked to link a band with another band to trade shows.  Lawyers, managers and labels are asked to do the same.  “Hey, can you ask xxxx band if we can trade shows or if they know someone who can redesign our website or shoot a video or do some graphic design work…” are all questions that come across our email boxes, text screens and phones every day.    “Why yes, we may know someone who can help you with that” is the response we hope to give and the artist hopes to receive.

Roles are crossing over.  In what was once a very defined career (I do publicity only, I only book shows, I only know how to review and negotiate contracts, etc) has all been jumbled together.  Artists as well as the music industry professionals have all had to review and revise the way things are done.  Many who started in the “dinosaur age” have yet to grasp this concept and are learning an ugly truth–extinction sucks. 

So what do artists need?  It seems that terms “multitasking” and “Where’s the beef” have made a comeback.  Artists need everyone to step up and help in areas not before contemplated.  It makes sense after you ponder on it for more than a moment.  We all have lots of connections and access to creative and hard working people and companies.  A publicist knows the best magazines and websites but also may know the best booking agent in town or even the best sound engineer.  A lawyer who drafts agreements with and for labels will know the decision makers at a label, the best distributors and the key producers to employ to get a band to where it needs to be.   Back in the “dark ages” people held their contacts close to the left pocket;  but, it benefits everyone if we would open up.  Some of us are and some aren’t.  

To us it is a no brainer that what is good for the band/client is good for us.  If we are able to get a band distributed through one of our connections or have one of their songs licensed, why wouldn’t we help out?  It means more work (and therefore more money) to us as well.   We are continuously baffled when we run into a dinosaur that, when pressed for a referral or even advice, retorts with “We don’t do that” or “I’ve never thought of connecting the band with my best friend at WILLIAM MORRIS”!

The point is, as an artist with talent, you need a team that truly opens its doors to you.  As important as it is to hire experts that can handle each need of a band, the lines are so blurred at this point that your team must consist of utility players that can handle more than one task.  There just isn’t enough money to go around anymore to pay 20 experts what you can pay 1 expert multi-tasker. 

A tight community with everyone working together, and the best getting referred the most often.   So, who could be against such a thing?  No comment.  But, we here at L4M have been doing more and more of this and no one could be happier.  Nothing excites us more than new and fruitful relationships.  There are many examples we could share but choose not to out of privacy and anonymity.  The future is now…find the right team.

Chicago Rocks!

We at L4M represent musicians from all over the country.  Yet, deep down, we have a special affinity for Chicago musicians.  Is it because we live in Chicago?  Well…yes, duh.  Anyway, some of the best music at some of the best venues happen here in the Second City.

The time has come (again) for Chicago artists to get the attention that they deserve.  L4M and the Bottom Lounge has teamed up to present a “This is Chicago” music series featuring many of our clients at one of the best Chicago music venues in the city. 

The first concert will be SEPTEMBER 16, 2010 at 8:00pm (doors) and feature Blah Blah Blah, of1000faces (featuring Matt Walker), The Blind Staggers and DJ Yours Truly.  It’s five bucks online with code:  Blah or eight bucks at the door.  Please come out and support goood music, a good musical venue and some decent lawyers.  We want to make this a regular event, so let’s pack the first one.

Here’s the Bottom Lounge’s Promo Page:

BLAH BLAH BLAH • THE BLIND STAGGERS • of1000faces

CHIRP RADIO WELCOMES: Thursday, September 16, 2010 – 9:00pm

BOTTOM LOUNGE AND LAWYER4MUSICIANS.COM PRESENT

 

Doors 8:00 PM / 9:00 PM.

17 & Over

L4M and Friends Make a Move


Exciting news from L4M headquarters.  After following the recent trends in film and music, the L4M team (basically yours truly) decided that independent is, in fact, better.  While we have always brought an unfettered view of the industry and have not exactly been held back by the “establishment”, we have officially started practicing what we have preached.

Along with a couple of other former partners and one new music guru, a new firm was formed.  Troglia Kaplan Holzman will be the law firm behind the L4M crew for the foreseeable future.  We are a general business law firm that specializes in helping creative individuals and their businesses navigate through the turbulent legal and business world that surrounds them.  Our new firm will give us even more flexibility and availability to help musicians, film makers and artists to treat their particular craft as an actual business.  Basically this move will allow our Left Brain Guide to the Right Brain Thinker grow and improve.

Contact us if you have questions or issues that you would like to see tackled by us and this site: josh@lawyer4musicians.com or info@tkhlaw.com.

To find out more about our newest L4Mer, click here and discover the man, the myth, the legend: Ajay Gosain.

Unique Methods to Fund Records and Films

Websites that serve as independent fund raisers for artists are not new.  Over the past decade several sites using the fan funded model have popped up (some have subsequently disappeared).  The sites are natural offspring of some entrepreneurial and creative musicians and film makers realizing that the label/studio system probably is not going to work form them.

The basic premise is that you offer your friends, family and fans (the 3f’s)  an opportunity to participate in the creation of your new album or film.  In exchange for buying a piece of the project the 3f’s will get extras that the general public will not get.  Examples of the extras that participants get are: exclusive tracks, t-shirts, signed copies of vinyls, screenings with the cast and crew, etc.

Some models have tried to take it to the next step and share income with the 3f’s who go from participants to investors when they provide money to a project.  Sellaband.com is probably the most well known band investment models (now in bankruptcy, this concept obviously has some issues to figure out still).  On the film side of things sites like kickstarter.com and indiegogo.com have had success in getting independent movies with fairly small budgets into production via fan participation.

But what happens when you want to raise more than $5,000 or even $50,000?  I guess it depends on how wealthy your 3f’s are.  For most of our clients we are trying to raise money in the several hundred thousands or millions for their projects.  Their 3f’s are typically not looking to get a t-shirt or dvd out of their participation when they are putting that much money into a project.  In most scenarios a participant becomes an investor and will want to see a monetary return on his investment.

Equally as important, the method for raising money with the promise of a financial return on investment follows very strict rules and regulations.  When you try to raise significant funds for your project you are essentially selling securities or stock in your product.  The Securities and Exchange Commission governs these type of transactions and you must follow their guidelines or risk serious consequences.  Unfortunately, the legal fees for setting up an Offering (offering of a financial interest in your project) are high and you definitely cannot create an Offering on your own (even if you find an example on line).  Oftentimes, musicians and film makers must go to their 3f’s just to get the money to pay for the Offering.

So with all of these barriers why to musicians and film makers go through the trouble?  Several reasons.  First, the old days of being discovered are over.   The quantity of product is simply too high and the methods for finding talent are too vast.  A&R departments are decimated and studio budgets are tighter than ever.  Risks are averted on all levels.  It is now a necessity for the independent to truly be independent and make their own way in the industry.  Further, most musicians and film makers feel that if they get their first project produced and into commerce, the sky is the limit.  This sentiment is justifiable.  Film makers who are able to get a movie made and actually distributed immediately create a brand for themselves and their production company.  It is far easier to sell the second feature as compared to the first.  Same for musicians.  A musician who has released countless EP’s and singles may not be interesting to an investor until she produces and distributes a full length album.

So as the annoying saying goes, you have to spend money to make money.  Whether it is strictly as a participant structure or through an Offering, a lot of work, time and money goes into the process.

I am interested to hear from those of you have used this method; whether it is through a website or on your own door to door fund raising effort.  Here are some of my friends who are using the participant method.  Check out and if you like them, PARTICIPATE!

Film maker Carey Bruce and Road’s End Films are producing Forests of Mystery and using Kickstarter.com:

Talented Singer/Songwriter Levi Weaver has funded his own projects through 3f participation.  Check him out here: