Not too long ago, I had an opportunity to work on a project alongside a large, big-name consulting firm. Here was an army of highly-educated wunderkids, all who came bearing one hundred questions, but rarely even one conclusive answer. As the project grew longer and longer, and the answers increasingly elusive, I decided that these people were simply not very good consultants. After all, where were the solutions the client needed?

One day, I shared my concerns with a friend, who herself is one of those sought-after, big-name consultants. She smiled. “Ah… they sound like they’re very good at their job,” she said admiringly. “If they accomplish the objective, everyone goes home. Smart consultants never solve a problem. At least, not before they’ve uncovered a new one.”

This came to mind recently, when I saw NMPA President David Israelite’s recent comments about the need for blanket licensing, bravely made in front of the publishing masses at the NMPA annual meeting, and also reiterated in Billboard:

http://www.billboard.biz/bbbiz/industry/publishing/david-israelite-nmpa-president-s-guest-post-1005250672.story

David Israelite

On the face of it, Israelite’s primary point is unassailable. The current system of licensing, particularly in regards to mechanical and synchronization licenses, doesn’t work and must be fixed. Who could dispute it? As Israelite quite honestly points out, after all the legal sturm und drang about YouTube, if Google came to the publishing community tomorrow and completely acquiesced to all demands, offering to pay whatever it took to license the rights they needed, the publishers would be completely incapable of actually doing the licensing necessary. On a legal, practical, and PR level, that doesn’t put the publishers on particularly solid ground.

Especially when it comes to licensing synchronization uses, music publishers have always insisted that the use of a song in “synchronization” with a moving picture (like a video, film, advertisement or game) requires the licensing approval of each owner of the copyright. That’s a number that as recently as the 1980s
meant potentially three or four songwriters and their publishing representatives, but can now often mean up to ten or twelve writers, some with different publishers in each territory of the world, some of whom may control as little as 1 or 2% of the song.

Needless to say, this could require weeks of phone calls and research, and that’s just to find out who controls the necessary rights. After that, the poor music supervisor, film studio, TV producer or advertising agency still has to come up with a sync fee number and legal terms that will satisfy all parties involved—all of whom of course insist on favored nations status with each other. Now multiply all those headaches by several hundred thousand.

Why several hundred thousand? Because in the internet age, that’s the way companies are interested in licensing music. The focus now is not on one specific featured use in a movie or advertisement. It’s not even on ten songs all needing mechanical licenses to appear on an individual album. Rather, services like YouTube, iTunes, Spotify, and others need to license the whole of popular music, en masse, in order to be able to offer the variety and selection that the consumer demands. In that context, one by one is a little impractical. Like having to obtain permission to use each individual word in your novel.

Needless to say, the need for blanket licensing is pretty obvious, particularly to those who spend each day trying to work through the morass of the current system. Historically, music publishers have not stood out for their foresight and boldness. Yet even they will acknowledge that the crisis has arrived, and something has to change.

In the area of mechanical royalties, Israelite suggests an approach that grew out of an attempt to reform the compulsory license section of the US Copyright Act (Section 115). This would provide for a series of mechanical licensing agents (similar to the PRO’s like ASCAP and BMI). Publishers would have the right to choose among the agents, or change agents, but these designated agents would represent the one-stop, or maybe three or four-stops for anyone seeking a mechanical license. Further, these same agents could also license synchronization rights, on a pre-set, “blanket” rate basis. The blanket licenses would cover everyone and everything, eliminate the back and forth negotiation over each individual permission, and hopefully bestow that warm and fuzzy feeling for which blankets are known.

It sounds more efficient for the publishers as well as for the people seeking to license music or to build services around music. And while it certainly takes away some of the possibility of demanding a king’s ransom for that 7.5% share of the classic copyright that you own, the increase in the number of small wins, on a global basis, will probably more than make up for the loss of the occasional jackpot. Not to mention, it might keep folks like YouTube from just tossing in the towel and taking the music without any licensing at all.

So why hasn’t it happened?

As I said up at the top—not everyone loves a problem-solver. If the consultants fix what’s broken, everyone goes home. Likewise, music publishers don’t necessarily want to remove the logjams in the licensing system. Those logjams are largely the reasons publishers exist in the first place. Simplifying a system is rarely good news for the middle-man. And publishers are the ultimate middle-men between songwriters and the people who actually use the music the songwriters create.

If one agent is responsible for issuing all of the mechanical and sync licenses according to a pre-set fee structure for a particular composer’s catalog, why would that composer need a publisher? After all, the agency is presumably already taking some sort of fee for its role in the process. Why would a songwriter also give a publisher a 25% share of the income for the next 15 or 30 years? To do what? In a more precise example—if the whole music licensing world worked in roughly the same way as ASCAP and BMI do with performing rights, would future songwriters have any real need for a publisher?

Skeptical music weasel that I am, I don’t anticipate that the NMPA membership will be rushing out immediately to champion the cause for blanket licensing. Still, realist that I am—it’s probably worthwhile for those in the publishing game to take a glance at the inevitable and ask, in our customarily self-interested way:

What does this mean to us?

Three quick things to ponder, as our livelihood passes before our eyes:

1. Age before beauty.
The older publishing catalogs, particularly those built in the Fifties, Sixties and even Seventies, when you could still manage to obtain a full-publishing share for life of copyright , are looking even better. They won’t be doing deals like that no more.

2. Quantity over quality.
It’s hard to see how a blanket licensing system will not in some way reduce the viability of building a successful business around a few isolated “big copyrights”. While the sync fees may come down for any one individual copyright, the theory is that the money will be made up in volume. It may well be true, but it’s a system that favors the major publishers, who own thousands of licensable songs, rather than a small independent with one classic in the catalog.

3. The end of the paper tiger.
If licensing problems disappear, administration is no longer a service for which songwriters will pay. That means it’s all about advances (as if it weren’t already) and creative services. Songwriters may still need a bank, at least to keep them alive in the early stages of their career. They may also still need someone to help them jump-start their career and keep it moving—pitching songs, setting up collaborations, and finding opportunities for their music. At least, I hope they will.

Otherwise I’m going back to my consulting business.

Follow me on Twitter @EricBeall

Life in the Slow Lane

Aug 12 2010

While I was walking home tonight, I passed by a museum and something in the window caught my attention. It was a display of a small antique pipe organ from the late 1700′s– it looked like a very early attempt to create a miniature Wurlitzer that could be played at home. A rather odd, “Chitty Chitty Bang Bang” type of contraption, it reminded me of the homemade time travel machine rigged up by Doc Brown in “Back to the Future”. In its day, it probably looked as cool as the iPad. Now, it’s not something that anyone uses to get the job done.

The sight of this awkward, ungainly invention brought me back to an analogy made by one of my colleagues earlier in the day, as we discussed the current challenges of copyright licensing. “I feel like we’re trying to drive some old unrestored 1950′s clunker” he said, “the kind that only the old guy that owns it can actually drive, because you have to know just how to wiggle the gear shift and how many times to pump the brakes to make it all work”. I heard almost the same sentiment at a lunch with one of the industry’s most respected copyright lawyers. Everyone in the music business knows it’s true, though few will say it publicly, since it directly undermines our demands to get paid for what we own. But the old copyright system just ain’t working anymore. The truth is:

The process of licensing copyrights has to change drastically and fundamentally, if the whole concept of copyright is going to survive at all.

Right now, we’re driving down the Information Superhighway in that old 1950′s jalopy– we’ve got it floored and we’re doing about 35 miles an hour. Copyright holders are not only being run over, we’re also being passed by, as young entrepreneurs from the Google, YouTube, Spotify generation create global empires built on providing immediate, free access to entertainment and information. Meanwhile, the copyright community is still back somewhere on the side of the road, trying to figure out who owns the rights in which territory and for how long, and who has the right to issue the license, and how many licenses will be necessary, and what should the license cost. At best, we’re an impediment. At worst, we’re irrelevant.

Consider:

At a family wedding, the bride and groom do a crazy dance to a medley of big pop hits– it’s all relatively harmless (at least from a copyright standpoint) and clearly covered by the principle of “fair use”. After all, this is kind of what music was made for. But not too surprisingly, the dance is captured on videotape by the people filming the wedding. It’s then posted on YouTube, probably as a simple, cheap way of sharing the moment with family and friends. Again, it’s all still covered by fair use, since it’s largely a private activity and there’s no attempt to sell anything.

But suddenly, the family wedding video becomes a viral phenomenon, and millions of viewers go to YouTube to watch the silly dance, generating plenty of tangible economic benefit to YouTube in the process. At this point, clearly the copyrighted material contained in the video (that is the medley of recorded music to which the dance is performed) should be licensed, and the labels, artists, publishers and songwriters should be compensated. But how? Just a guesstimate would indicate that there could be 15 different artists, all of the major labels (some of which might no longer own the master recordings in question), probably at least fifty songwriters, and twenty different music publishers, each of whom would have to grant permission, and then play a role in determining the appropriate sync fee for each song. It would take months for a two minute home video, and probably cost in the six figure range. Ridiculous.

Here’s another:

A video collector owns outright some archival footage of a big star performing on a TV variety show from years ago, which a new mobile entertainment provider now wants to license and sell as a download to mobile phones in Asia. But within this short segment, the big star performs a song, which would have been licensed under a sync agreement that covered only that particular performance, in that territory, during a specific window of time. In order to use the footage in a different medium, territory and era, a new sync license will need to be negotiated with all of the publishers (many of whom have sold their catalogs or allowed the copyrights to revert to the songwriters). And then there’s the matter of union fees. Several of the performers on the show may have been members of the American Federation of Television and Radio Artists (AFTRA), Screen Actors Guild (SAG) or the American Federation of Musicians (AF of M), which means there might be residual payments due for any reuse of the show. Good luck figuring that one out.

A last example:

A music fan in Japan wants to purchase the new CD by an American act signed to Columbia/Sony Records in the US. The CD has never been released by Sony in Japan. The fan logs on to Amazon, locates the CD, and purchases it. But Amazon can’t fulfill the transaction, due to a copyright infringement lawsuit initiated by Sony Japan. As the local distributor of Sony product in that territory, Sony Japan owns the rights to sell that product in their region. By allowing the consumer to purchase directly from Sony in the US, Amazon is infringing on the copyright. And it’s true, even though Sony Japan has no intention of making the record available in Asia. As the copyright holder, the local company has the right to distribute the product or not, at their discretion.

In part, this explains why a consumer in the US who wants an album by a French artist released only in France can’t simply go on iTunes and purchase it. He or she can go to iTunes France and see the album or hear samples of the music. Certainly, the consumer can steal the record on any number of illegal sites. But purchase it? Nah. That would be copyright infringement. Go figure.

Anyone who reads this blog regularly knows that I’m a staunch defender of copyright. I’m not a believer that information wants to be free. I am however realistic enough to know that information wants at least to be available, at some generally reasonable price. Right now, our copyright laws are a hodgepodge of political compromises and outdated principles, all changing from country to country. In a global world, they are structured territory by territory. In a society based on instant access and immediate gratification, they are restrictive and reliant on step by step negotiations with half a dozen different parties for a single use. They can’t survive like this.

Unfortunately, there are no attractive solutions. Clearly, any reform needs to be done on a global level. The web is worldwide after all. That should be easy. We can take it up right after we solve the problem of world hunger and get everyone to agree on global warming.

Even worse, the only viable answer to the internet-related problems seems to lie in some kind of system of blanket licensing, similar to that used by the performing rights organizations to collect on music being used in public venues. In some form or another, a tax or surcharge would need to be assessed on electronic equipment or computer technology, or directly on internet service providers, mobile phone networks and other “distributors”. The money collected would then be shared among the entire creative community, from publishers and labels to artists, writers and union members.

If that seems like a simple and clean resolution, it’s not. The problem is that all of the money would go into a fund, and then be distributed to the copyright holders without any clear way of attributing it to a specific use. Worse, the ability of each individual copyright holder to negotiate fees on his or her own behalf and to collect them would be lost– thus eliminating two of the major functions of a music publisher in one fell swoop. In essence, such a move would make much of the music publishing role obsolete. If only for reasons of self-interest, it’s not a proposal I relish.

The only thing worse is the alternative, which is what’s happening now. We are already becoming obsolete, simply because people are ignoring us. Sure, we can still make things grind to a halt with a major lawsuit here or there, or exact our revenge with a jumbo copyright-infringement settlement–after about ten years in court, fighting appeal after appeal. But the judges are getting less sympathetic, the law is seeming less and less just to society at large, and the internet generation is moving ahead without us. Most importantly, we’re leaving stacks of money on the table every day, by not being able to take advantage of licensing opportunities for our music. There’s no value in owning copyrights if no one has the time, patience or money to license them. Already, more and more creators are simply making new product which they own in its entirety, and licensing it directly to individual services.

There was an article in the New York Times today, about an inmate who after having been wrongfully imprisoned on death row for twenty years had just been set free. His one request to a benefactor had been a Walkman, only to be informed that no one used them any more, and handed an iPod. As the surprised ex-con acknowledged, it’s painful sometimes, but things change. You have to move on.

Otherwise, you’re an artifact in a museum window.

Alright– I promise. This is the last YouTube diatribe at least until the end of the summer. But since the most recent call to arms on this blog, I actually wound up doing a NPR radio interview for a story about the growing influence of YouTube in the music biz. The prospect of being on the firing line prompted me to do a bit more homework about the licensing battles involving YouTube at the moment– and the more I read, the more angry I’ve become. So now, I’m really fired up.

Yes, I know that YouTube provides a very valuable service to unknown and developing artists in helping to expose them to a wider audience. I know that YouTube can be a useful A&R service, helping to draw label and publisher attention to particularly reactive songs or artists. But for active or aspiring songwriters and music publishers, I think it’s worthwhile to understand how YouTube has approached rate negotiations with publishers, record labels, and copyright owners. It certainly presents a pretty clear picture of the level of seriousness they are bringing to the negotiating process and to complying with copyright law. It also makes very clear the actual monetary value they attach to music.

In a nutshell, here’s the situation:

With the record labels, YouTube is currently in negotiations to renew licenses made several years ago. While the labels thus far have fared better than anyone else with YouTube, the actual income generated under these early license agreements is negligible. YouTube income has certainly not done much to break the free-fall in which labels now find themselves, nor has it softened the blow to the artists, most of whom are still wondering when that elusive YouTube income is going to show up on their accounting statement.

But on the publishing side, it’s even uglier. For the performing rights organizations, led by ASCAP, the last three years of negotiation have proven extremely disillusioning. Back in 2005, YouTube agreed to make performance payments, based on an understanding between ASCAP and YouTube that both parties would eventually settle on a reasonable rate. Unfortunately, it’s easier to agree to agree than to actually agree. After years of negotiations, YouTube and ASCAP have failed to reach an agreement upon a reasonable rate, and YouTube has paid nothing to the PROs while that fruitless negotiating was going on. If you want to know why those talks fell apart, here’s one clue:

Just last week, a judge from the US District Court ordered YouTube to pay 1.4 million dollars for the unlicensed use of ASCAP’s material from 2005-2008. Then, the judge ordered YouTube to pay $70,000 a month, beginning in January of 2009. To put that in proper perspective, consider that Imagem Music recently purchased the Rodgers and Hammerstein song catalog for somewhere around $20 million dollars. So while the purchase of one song catalog from one writing team (granted a pretty good one) will set you back $20 million, the judge is granting YouTube unlimited access to HALF OF THE ENTIRE SONG CATALOG IN AMERICA FROM THE LAST 100 YEARS for $1.4 million dollars. Even the judge acknowledged the measly nature of the sum, saying:

“Even considering that the fees paid to ASCAP will represent only about one-half of the total fees that YouTube pays to music performing rights, the contemplated interim fees are clearly reasonable, even conservative, in comparison to those called for in other licenses for the performance of copyrighted content on the Internet,” Judge Connor said.

Well, he got that right. $1.4 million dollars is scraping the bottom of the barrel, given the extent of unauthorized use of copywritten material over the past four years. But get this– YouTube thinks even $1.4 million its too much! How much would it like to pay for access to the entire ASCAP catalog, which includes thousands of classic songs from every era in modern music history? Uh, maybe about $80,000?

Huh? Did someone forget a zero or two on that number? No. YouTube has proposed that they will pay $80,000 to cover the last three years, and then about the same amount annually in 2009 and beyond. That’s a pretty sweet deal. It’s also a pretty revealing one, in case you’re wondering what YouTube and Google think copyrighted music should be valued at. Basically, less than the annual salary of one mid-level executive in their office.

Of course, YouTube and Google claim that since YouTube has proven woefully unsuccessful at actually making any money, they shouldn’t be saddled with the hindrance of having to pay fees for use of the material that is at the core of at least fifty percent of their most popular programming. The flaw here is that YouTube was never actually designed to make any money.

Like many internet businesses, the strategy from its conception seems to have been to create a site that was immensely popular rather than income-generating. Of course, this was done with the knowledge that such a popular destination could then be flipped for a massive financial payout to its creators, despite the fact that there were no actual earnings. Not surprisingly, this is exactly what happened when Google purchased YouTube for $1.65 billion. How convenient for the creators that they didn’t have to share any of that $1.65 billion with the people that created the material upon which their “network” is based. They probably would have sent over a check for 80 grand.

When one considers the financial burden of paying ASCAP royalties upon a company like YouTube, it’s worth remembering that YouTube is basically an entertainment network that creates absolutely nothing of its own. Every minute of its programming is made up of things either donated or stolen. YouTube is a TV station that doesn’t even own a camera. Given that they have virtually no overhead, it doesn’t seem unreasonable that payments for rights to the material they use should cost them at least half of what they actually bring in, maybe more.

During the interview with NPR, I was asked about the promotional service that YouTube provides to the music industry. Surely, the exposure that it offers artists at all different levels has to acknowledged. In fact, in this blog, I’ve suggested on several occasions that the smartest career strategy for a new, unknown artist would be to create one great song, do a truly inventive, provocative, funny, attention-grabbing video and post it on YouTube, then see how the audience reacts. As a means of being “discovered”, there aren’t many better, or more accessible forums.

But for established artists, record labels, and publishers, the “promotional” value of YouTube is starting to look rather dubious. Promotion for what? To help artists sell albums? That’s clearly not working. Check the album sales of the music industry as a whole since 2005. Whatever promotional service YouTube is providing, it’s not very effective.

Suppose you owned a butcher store and a man set up a table in front of your shop, handing out free hamburgers. You might complain— but then he would explain that really he was providing a promotional service for your butcher shop, showing people just how tasty a well-cooked piece of beef could be. What seemed to be direct competition for your shop would prove to be a boon to your business. Great.

But what if your butcher business then proceeded to crash and burn, as your customers took the free hamburgers, ate them for dinner and never came into your store again. How long would you wait until you tried to get rid of the less than helpful “promoter” outside your store?

As I’ve said before, the day of reckoning may have arrived. Warner has taken a bold, if marginally effective step, by pulling product off of YouTube. ASCAP continues to fight the good fight. On the other hand, Universal has immediately abandoned the protection of its writers and artists, and hopped into bed with YouTube, trying to put the rest of the industry at a disadvantage. And here’s another less than encouraging story from the front-lines of the battle:

PRS, the licensing organization for publishers and songwriters in the UK, has been in its own rate dispute with YouTube, running into the same negotiating brick wall that ASCAP, NMPA and others have encountered. In a move that took the industry somewhat by surprise, YouTube recently countered PRS’s tough negotiating stance by pulling off all PRS-licensed, premium music videos supplied by the labels in the UK.

It now appears that PRS has come back to the negotiating table with a new offer. Rather than insisting on the previous royalty rate of .22p per track, they have put forward a new compromise. The new per track price?

0.0085p

Yep. From 22 pence to less than a penny. There’s not much you can buy for less than a penny anymore– here or in London. Apparently, a song is one of them. For songwriters and publishers, what you can see on YouTube tonight is your career slipping away…

Alright– I promise. This is the last YouTube diatribe at least until the end of the summer. But since the most recent call to arms on this blog, I actually wound up doing a NPR radio interview for a story about the growing influence of YouTube in the music biz. The prospect of being on the firing line prompted me to do a bit more homework about the licensing battles involving YouTube at the moment– and the more I read, the more angry I’ve become. So now, I’m really fired up.

Yes, I know that YouTube provides a very valuable service to unknown and developing artists in helping to expose them to a wider audience. I know that YouTube can be a useful A&R service, helping to draw label and publisher attention to particularly reactive songs or artists. But for active or aspiring songwriters and music publishers, I think it’s worthwhile to understand how YouTube has approached rate negotiations with publishers, record labels, and copyright owners. It certainly presents a pretty clear picture of the level of seriousness they are bringing to the negotiating process and to complying with copyright law. It also makes very clear the actual monetary value they attach to music.

In a nutshell, here’s the situation:

With the record labels, YouTube is currently in negotiations to renew licenses made several years ago. While the labels thus far have fared better than anyone else with YouTube, the actual income generated under these early license agreements is negligible. YouTube income has certainly not done much to break the free-fall in which labels now find themselves, nor has it softened the blow to the artists, most of whom are still wondering when that elusive YouTube income is going to show up on their accounting statement.

But on the publishing side, it’s even uglier. For the performing rights organizations, led by ASCAP, the last three years of negotiation have proven extremely disillusioning. Back in 2005, YouTube agreed to make performance payments, based on an understanding between ASCAP and YouTube that both parties would eventually settle on a reasonable rate. Unfortunately, it’s easier to agree to agree than to actually agree. After years of negotiations, YouTube and ASCAP have failed to reach an agreement upon a reasonable rate, and YouTube has paid nothing to the PROs while that fruitless negotiating was going on. If you want to know why those talks fell apart, here’s one clue:

Just last week, a judge from the US District Court ordered YouTube to pay 1.4 million dollars for the unlicensed use of ASCAP’s material from 2005-2008. Then, the judge ordered YouTube to pay $70,000 a month, beginning in January of 2009. To put that in proper perspective, consider that Imagem Music recently purchased the Rodgers and Hammerstein song catalog for somewhere around $20 million dollars. So while the purchase of one song catalog from one writing team (granted a pretty good one) will set you back $20 million, the judge is granting YouTube unlimited access to HALF OF THE ENTIRE SONG CATALOG IN AMERICA FROM THE LAST 100 YEARS for $1.4 million dollars. Even the judge acknowledged the measly nature of the sum, saying:

“Even considering that the fees paid to ASCAP will represent only about one-half of the total fees that YouTube pays to music performing rights, the contemplated interim fees are clearly reasonable, even conservative, in comparison to those called for in other licenses for the performance of copyrighted content on the Internet,” Judge Connor said.

Well, he got that right. $1.4 million dollars is scraping the bottom of the barrel, given the extent of unauthorized use of copywritten material over the past four years. But get this– YouTube thinks even $1.4 million its too much! How much would it like to pay for access to the entire ASCAP catalog, which includes thousands of classic songs from every era in modern music history? Uh, maybe about $80,000?

Huh? Did someone forget a zero or two on that number? No. YouTube has proposed that they will pay $80,000 to cover the last three years, and then about the same amount annually in 2009 and beyond. That’s a pretty sweet deal. It’s also a pretty revealing one, in case you’re wondering what YouTube and Google think copyrighted music should be valued at. Basically, less than the annual salary of one mid-level executive in their office.

Of course, YouTube and Google claim that since YouTube has proven woefully unsuccessful at actually making any money, they shouldn’t be saddled with the hindrance of having to pay fees for use of the material that is at the core of at least fifty percent of their most popular programming. The flaw here is that YouTube was never actually designed to make any money.

Like many internet businesses, the strategy from its conception seems to have been to create a site that was immensely popular rather than income-generating. Of course, this was done with the knowledge that such a popular destination could then be flipped for a massive financial payout to its creators, despite the fact that there were no actual earnings. Not surprisingly, this is exactly what happened when Google purchased YouTube for $1.65 billion. How convenient for the creators that they didn’t have to share any of that $1.65 billion with the people that created the material upon which their “network” is based. They probably would have sent over a check for 80 grand.

When one considers the financial burden of paying ASCAP royalties upon a company like YouTube, it’s worth remembering that YouTube is basically an entertainment network that creates absolutely nothing of its own. Every minute of its programming is made up of things either donated or stolen. YouTube is a TV station that doesn’t even own a camera. Given that they have virtually no overhead, it doesn’t seem unreasonable that payments for rights to the material they use should cost them at least half of what they actually bring in, maybe more.

During the interview with NPR, I was asked about the promotional service that YouTube provides to the music industry. Surely, the exposure that it offers artists at all different levels has to acknowledged. In fact, in this blog, I’ve suggested on several occasions that the smartest career strategy for a new, unknown artist would be to create one great song, do a truly inventive, provocative, funny, attention-grabbing video and post it on YouTube, then see how the audience reacts. As a means of being “discovered”, there aren’t many better, or more accessible forums.

But for established artists, record labels, and publishers, the “promotional” value of YouTube is starting to look rather dubious. Promotion for what? To help artists sell albums? That’s clearly not working. Check the album sales of the music industry as a whole since 2005. Whatever promotional service YouTube is providing, it’s not very effective.

Suppose you owned a butcher store and a man set up a table in front of your shop, handing out free hamburgers. You might complain— but then he would explain that really he was providing a promotional service for your butcher shop, showing people just how tasty a well-cooked piece of beef could be. What seemed to be direct competition for your shop would prove to be a boon to your business. Great.

But what if your butcher business then proceeded to crash and burn, as your customers took the free hamburgers, ate them for dinner and never came into your store again. How long would you wait until you tried to get rid of the less than helpful “promoter” outside your store?

As I’ve said before, the day of reckoning may have arrived. Warner has taken a bold, if marginally effective step, by pulling product off of YouTube. ASCAP continues to fight the good fight. On the other hand, Universal has immediately abandoned the protection of its writers and artists, and hopped into bed with YouTube, trying to put the rest of the industry at a disadvantage. And here’s another less than encouraging story from the front-lines of the battle:

PRS, the licensing organization for publishers and songwriters in the UK, has been in its own rate dispute with YouTube, running into the same negotiating brick wall that ASCAP, NMPA and others have encountered. In a move that took the industry somewhat by surprise, YouTube recently countered PRS’s tough negotiating stance by pulling off all PRS-licensed, premium music videos supplied by the labels in the UK.

It now appears that PRS has come back to the negotiating table with a new offer. Rather than insisting on the previous royalty rate of .22p per track, they have put forward a new compromise. The new per track price?

0.0085p

Yep. From 22 pence to less than a penny. There’s not much you can buy for less than a penny anymore– here or in London. Apparently, a song is one of them. For songwriters and publishers, what you can see on YouTube tonight is your career slipping away…

Back in my songwriting days (yes, I actually used to have a job where I created something, rather than just trying to sell something), I used to work with a collaborator who referred to her songs as her “babies”. To be honest, I never felt quite that maternal about my tunes (probably a gender thing). I viewed them more as unruly teenagers—brimming with potential, but usually plagued by one or two disastrous character flaws, and prone to costing me a lot more money than they would ever bring in.

Nevertheless, those songs were mine. I wouldn’t want to think of them as orphans. Actually, I never knew songs could be orphans. But apparently, they can. Imagine them, sitting homeless and forlorn by the side of the road, waiting for someone to come by, offer a ride, and take them away…

Could happen. I saw a fascinating blog recently:

Music-Technology-Policy

which on Friday, April 25 addressed the issue of “orphan works” – a subject currently in front of the United States House and Senate. “Orphan works” are copyrights (songs, books, recordings, you name it) for which it is not possible to identify or contact an owner. What the author of Music-Technology-Policy, Chris Castle, very adroitly points out is that there are large commercial interests, Google in particular, that have a vested interest in supporting legislation to make it possible for these “orphaned” works to be used freely, without compensation or risk of penalty.

The problem is largely one of definitions. Certainly, anyone with experience in publishing would be willing to acknowledge that some works do fall into “orphan” status. Disputes between writers, convoluted copyright histories, failure of heirs to continue to administer copyrights, works essentially abandoned by their own authors (remember that scene in “Raising Arizona” where they leave the baby on the car)—these are all situations that can eventually make it impossible to identify the proper owner of a copyright. But companies like Google are setting the bar pretty low.

According to the blog, Google’s Lester Lessig has referred to “out of print books” as orphans. Google’s General Counsel has said publicly: “These works include those for which the author or assignee of the work – the work’s “parent”—can no longer be determined, usually because the contact Information on the copyright registration is out of date”. They also expand that definition of orphan to include “works that have been, for all intents and purposes, ‘disowned’ either because any potential monetary value of the works has expired or because their authors simply are not interested in enforcing copyrights on their works”.

Wow. Those are pretty broad definitions. To claim that just because something is “out of print” makes it an orphan would put a huge portion of American music’s master recordings into the home for wayward record albums. Only a very small portion of recorded music can ever be profitably kept “in print” at any given time. But it may still be actively used in movies, television, advertising, etc. Similarly, labeling something an orphan because of an incorrect contact on the copyright registration is like deeming anyone with an incorrect address on a driver’s license a fugitive. Copyright registrations are notoriously out of date, which is why large film studios use search services that specialize in tracking down authors and publishers.

Finally, to decide that works generating little income or for which the authors are no longer actively engaged in protecting the copyrights are “orphans” overlooks some fundamental realities of publishing. At Shapiro Bernstein, where I work, we have a song in our catalogue that for over two decades generated income in the low three figures (and that’s counting dollars and cents). But upon rediscovering it in the vaults, more than 50 years after its initial creation, the song suddenly found a new life—showing up in a Tarantino film, and then catching to become a stadium anthem, then finding its way into several national advertising campaigns. The song now generates more than enough income to keep its writers living well, and to renew their interest in their long lost “baby”. Songs come back. And when they do, the copyright owners get interested very quickly.

The point of all this is not to encourage you to write your Congressman about the “orphan works” legislation—though I wouldn’t discourage it either. The real point is to remind you once again of how important it is to maintain and update all of the information necessary for administering your copyrights.

Check your ASCAP registrations regularly. Make sure your publisher and your PRO have your correct address. Maintain accurate copyright registrations. Remain ever vigilante for unauthorized uses.

I’ve made all of these points before, both here, and in my book “Making Music Make Money”. It is a primary concern of my Berkleemusic class, Music Publishing 101. Whenever I talk about this subject, I usually emphasize that the songwriter is also a publisher of his or her own work, at least until he or she decides to assign that responsibility to someone else. As publishers, it’s our job to administer and protect the copyright.

But here’s a new way to look at it. You’re not only your song’s publisher. You’re the parent. You created it—now you have to take care of it. If you don’t, there are plenty of large “content” –hungry companies and creative “pop culture alchemists” who will be more than happy to take your song and call it their own. In this Information and Entertainment Age, nothing of value will stay an orphan for long.

Back in my songwriting days (yes, I actually used to have a job where I created something, rather than just trying to sell something), I used to work with a collaborator who referred to her songs as her “babies”. To be honest, I never felt quite that maternal about my tunes (probably a gender thing). I viewed them more as unruly teenagers—brimming with potential, but usually plagued by one or two disastrous character flaws, and prone to costing me a lot more money than they would ever bring in.

Nevertheless, those songs were mine. I wouldn’t want to think of them as orphans. Actually, I never knew songs could be orphans. But apparently, they can. Imagine them, sitting homeless and forlorn by the side of the road, waiting for someone to come by, offer a ride, and take them away…

Could happen. I saw a fascinating blog recently:

Music-Technology-Policy

which on Friday, April 25 addressed the issue of “orphan works” – a subject currently in front of the United States House and Senate. “Orphan works” are copyrights (songs, books, recordings, you name it) for which it is not possible to identify or contact an owner. What the author of Music-Technology-Policy, Chris Castle, very adroitly points out is that there are large commercial interests, Google in particular, that have a vested interest in supporting legislation to make it possible for these “orphaned” works to be used freely, without compensation or risk of penalty.

The problem is largely one of definitions. Certainly, anyone with experience in publishing would be willing to acknowledge that some works do fall into “orphan” status. Disputes between writers, convoluted copyright histories, failure of heirs to continue to administer copyrights, works essentially abandoned by their own authors (remember that scene in “Raising Arizona” where they leave the baby on the car)—these are all situations that can eventually make it impossible to identify the proper owner of a copyright. But companies like Google are setting the bar pretty low.

According to the blog, Google’s Lester Lessig has referred to “out of print books” as orphans. Google’s General Counsel has said publicly: “These works include those for which the author or assignee of the work – the work’s “parent”—can no longer be determined, usually because the contact Information on the copyright registration is out of date”. They also expand that definition of orphan to include “works that have been, for all intents and purposes, ‘disowned’ either because any potential monetary value of the works has expired or because their authors simply are not interested in enforcing copyrights on their works”.

Wow. Those are pretty broad definitions. To claim that just because something is “out of print” makes it an orphan would put a huge portion of American music’s master recordings into the home for wayward record albums. Only a very small portion of recorded music can ever be profitably kept “in print” at any given time. But it may still be actively used in movies, television, advertising, etc. Similarly, labeling something an orphan because of an incorrect contact on the copyright registration is like deeming anyone with an incorrect address on a driver’s license a fugitive. Copyright registrations are notoriously out of date, which is why large film studios use search services that specialize in tracking down authors and publishers.

Finally, to decide that works generating little income or for which the authors are no longer actively engaged in protecting the copyrights are “orphans” overlooks some fundamental realities of publishing. At Shapiro Bernstein, where I work, we have a song in our catalogue that for over two decades generated income in the low three figures (and that’s counting dollars and cents). But upon rediscovering it in the vaults, more than 50 years after its initial creation, the song suddenly found a new life—showing up in a Tarantino film, and then catching to become a stadium anthem, then finding its way into several national advertising campaigns. The song now generates more than enough income to keep its writers living well, and to renew their interest in their long lost “baby”. Songs come back. And when they do, the copyright owners get interested very quickly.

The point of all this is not to encourage you to write your Congressman about the “orphan works” legislation—though I wouldn’t discourage it either. The real point is to remind you once again of how important it is to maintain and update all of the information necessary for administering your copyrights.

Check your ASCAP registrations regularly. Make sure your publisher and your PRO have your correct address. Maintain accurate copyright registrations. Remain ever vigilante for unauthorized uses.

I’ve made all of these points before, both here, and in my book “Making Music Make Money”. It is a primary concern of my Berkleemusic class, Music Publishing 101. Whenever I talk about this subject, I usually emphasize that the songwriter is also a publisher of his or her own work, at least until he or she decides to assign that responsibility to someone else. As publishers, it’s our job to administer and protect the copyright.

But here’s a new way to look at it. You’re not only your song’s publisher. You’re the parent. You created it—now you have to take care of it. If you don’t, there are plenty of large “content” –hungry companies and creative “pop culture alchemists” who will be more than happy to take your song and call it their own. In this Information and Entertainment Age, nothing of value will stay an orphan for long.