Friday, November 20, 2009

What You As An Artist Need To Know To Prevent Getting Ripped Off




I have posted this in other music groups, social networking sites, music forums, etc., but I think this is something that is a must read for inspiring artists/companies. This will be the foreward for my new book on the industry, coming soon.


"Being an Independent Artist doesn't mean you have to do everything yourself"
* the above quote was taken from itsaboutmusic.com


I am amazed at the multitude of entertainment professionals and groups on the many sites that I have visited on the internet, dedicated to the profession that I love so much. However I am perplexed that there are enough of both "music business" and "music industry" professionals and companies with a large wealth of knowledge to cause a slight dent in the publication of all "industry" books as we know it, yet, very few, if any at all, independent artists or companies, that are trying to break into the industry, are even attempting to access this knowledge or these professionals.

There absolutely are not enough artists and/or companies engaging these professionals in these discussions on all of these sites. They think they don't need help, because they have the one "best theory" that most artists have. "I'll sell a a ton of cd's on my own MySpace page, gather a ton of friends and plays on my music player, and write my ticket". It seems everyone is banking on being discovered on MySpace, FaceBook, CD Baby, Itunes, Mixtape.com, Itsaboutmusic, or so many similar sites as these. The problem with that is that none, and I repeat none of these sites promote or market your product, and even if they say they do, you are probably doing a much better job in your own backyard or neighborhood, promoting and marketing at the corner stores, local festivals, underground radio stations, local disc jockeys, bars, club concerts and events, than any of these sites ever will. They are only a resource to expand on what you are or should already be doing on your own, and should be treated as such.


Yes, you may have to pay for some knowledge whether through a resourceful and informative book or the services of a professional. But it sure beats remaining in the unknown "twilight music zone" and causing more problems for yourself and your business, than if you were well informed and knowledgable about this industry, that you are trying to break into.

The music business/industry is one of the hardest and most ever changing businesess to try and break into. In most industries, you can have a business analyst prepare a business report, that will entail projected sell through estimates, projected product placement over view, ect.., ect.., But these things are hard to predict in the ever changing volatile environment of this business. You can't even depend on release date info., because they (the labels) are constantly moving them back. This is why you have to be fully prepared to "stay in the know" of what is going on, the why, where, and when it happened, how it will or won't affect you and your business, so that you can transform, update and stay right in the fray of it all.

There are new laws routinely enacted by Congress, new technology opening up the financial landscape of the music community, new business practices that can alter your relationships with companies or artists that you deal with directly or indirectly. You should be aware and not only keep your eyes, ears, and mind open, but have a team of professionals that will as well.
So I offer this little bit of information and you give me some feedback whether or not you have benefited from it or not. I offer my advice and services to all that seek assistance. I do run a business, but I wll help as much as I can. Some may dispute it, but I guarantee that it is better than doing nothing but depending on the aforementioned sites as your only resource. This was not gathered from a book, this is my knowledge that I have gained from over 20 years of working in this industry on various levels.


First thing that you need to do as an artist or independent company, is to acquire all the knowledge you can about the "music business", and the "music industry".

I. You are going to have to know all of your rights afforded to you in the copyright law. Why do I need to own my master recordings and all rights to them?
a. How do I protect my rights? What forms should I be using for complete protection?
1. What are my Performance Rights? What is Music Publishing and why is it the single most important right to me?
2. What are my Mechanical Rights and why do they matter to me and my music?
3. What are my Music Licensing Rights and why is it important to me?
4. What are my Print Rights and why are they important to me?
5. What are my Synchronization Rights, and why are they important?

b. The poorman's copyright is a waste of time, and does not hold any legal bearing!!(see my post on the Poorman's Copyright)

II. Why do I need to trademark my image, name, likeness, and logo? Why is branding so Important?

III. You are going to have to know all sources of your income from your music and how do you get paid from them.

Music Publishing
1. Mechanical Royalties (from Manufacturing)
2. Performance and Broadcasting Royalties
3. Synchronization Licensing
4. Sales of Sheet Music
5. Cover Versions (language translations)
6. The Print Licensing (sheet music, lyrics)
7. CD/DVD sales (traditional & digital downloads)
8. Administration and Registration of Copyrights
9. Obtaining a Record Deal

Other Sources
1. Artist royalties from record sales
2. live performances
3. personal appearances (movies, television)
4. merchandising (branding)
5. ring tones


* insure that you receive the money that you have earned by joining
* keep the rights that are yours (so you can keep generating income)
* PAY YOUR TAXES and you won't be bankrupted and have your assets seized by the IRS or any of the other tax authorities around the world.


THE VOLATILE ENVIRONMENT OF THE BUSINESS

The music business is a cutthroat world and there are numerous victims. You don't need a major record label to have a career—especially with all of the changes that the industry has been undergoing in the last few years—but you do need a successful business. Most artists today find themselves in what is called a "non recoupable" status, where the artist has been charged for all album costs incurred. If the album does not generate enough sales to cover these costs, the balance of what is owed is transferred to the next album, until all costs have been paid, for the last and current albums. The sad reality is that the artist may never recoup the costs, and will never have earned a single royalty from their work. This why it is so important to get your business in order and gain the knowledge that you need in order to give yourself a much better chance at success.

IV. What are the various music contracts or entertainment contracts I will encounter as an artist, or issue and/or encounter as an independent company or producer.
a. What are the individual points in a contract and what does each mean?
1. What is an artist royalty
2. What is the "statutory rate"? Why do I need to be concerned about it as an artist?
3. What does recoupable mean?
4. What is a contract term?
5. What is a sliding scale and how does it affect my artist royalties?
6. What is a 360 deal? Who is Live Nation? Why has it become a mandatory contract term with most labels?


* EVERYTHING IS NEGOTIABLE, AND I DO MEAN EVERYTHING!!!!!

V. What are the various sources and descriptions of distribution, and which one will best benefit me as an independent artist or company?
a. How will distribution get my foot in the door in other areas of the industry?
1. What is Distribution?
2. What is a P & D deal?
3. What is a 50/50 deal?
4. What is a major record distributor?
5. What is a wholesale distributor (one-stop)?
6. What is a specialty distributor?
7. What is a rackjobber?
8. What is "artist direct"?

VI. What industry associations do I need to join to either protect my rights, give me an opportunity to vote on a grammy, certify record sales, collect data for sales and record airplay, or allow me to be an offical part of the "industry"?

*i.e. - NARAS, NARM, RIAA, HARRY FOX, ASCAP, BMI, SESAC, MPA, BDS, SOUND SCAN, GEMA/BIEM, BIEM/MCPS, BIEM/STEMRA, SOUNDEXCHANGE, ECT......
VII. What resources are available to me for concert promotion, radio airplay, print media, local media, advertising & promotion (traditional and internet), merchandising (branding), manufacturing, ect..?

Since you are more than likely already working with other people, companies or artists I suggest you do some research on all the above immediately.

Second, If you are on a shoe string tight budget, I wouldn't be utilizing any of that budget, until you have sought out the knowledge and information that you need in order to progressively allow your business to move forward and begin making a profit. First thing you need to do after gaining this knowledge and information, is creating a solid music business plan. You will definitely need this. Don't assume just because you have the hottest mix tape, or cd in your local area that you don't need to have a music business plan.

There are over 1 million artists that try to break in the "music industry" every single year. Less than 1% of them ever make it to the next level. You are all in the "music business", as well as many other companies and entitities (Itunes, Best Buy, Amazon, BET, MTV. Apple Music, Kmart, Walmart, Barnes & Noble, Target) that deal directly or indirectly with the "music industry" (SONY/BMG, Universal Music, Warner Music Group (WEA), EMI, Fox Lorber, Fox, Buena Vista Studios, AEC One Stop Group, NARM, NARAS, RIAA), ( and there is a difference between both the actual "music industry" and the "music business").

Third, you need to put together a team of people, whether it is an artist, fellow producer, or dj that you currently are working with. Once you have created that business plan, all those I have mentioned need to have a responsibility in your business. Everyone must be accountable to the next person, so that you will have no doubt who will be relied on for things such as promotion, marketing, product placement, distribution, production, packaging, ect.... What this does is level the playing field, so that every member will know what their specific role is, and they won't feel left out or overburdened with the overall operation of your business. There is no I in TEAM, you can never, and shouldn't try, to wear all the hats. You must and should delegate responsibility to your TEAM.

Fourth, I would retain the services of a good "entertainment attorney", "certified accountant", "business manager", "publicist", and "tax professional", if your budget will allow that. This is called your "Conference Of Managers". If not, there are tons of resources out here. You just have to weed through all those that are junk, and choose the resources that best benefit you, your business outlook and situation. Eventually though, you will need to seek the help of these professionals.

Know this, and etch it in stone though: In order for you to grasp what an industry professional is speaking to you about, you must have gained at least a working knowledge of what they are relaying to you. This is the only guarantee from getting ripped off or being taken advantage of. No one person knows everything there is to know about this business. Even I learn something daily, because of the ever changing business environment of this industry.

WITHOUT PREPARATION YOU PLAN TO FAIL HORRIBLY.

I have sat on many panels at conferences and I get fed up with a hundred artists coming to me with that same old story. "Go to my MySpace page". First don't assume that any music professional is at any conference to handle any type of business. Truth be told, they have more than likely been "paid" to be there, and all accomodations have been taken care of. Most, not all, are there to take in a vacation, and especially if it is in an geographical location that is warm and tropical, while the rest of the country is snowed under. If you don't believe me, walk out into the hallway of any conference panel after everyone has left. If you have been passing out flyers, posters, cheaply produced demos with a photocopied picture of you and your boys on the cover, I can guarantee, that you more than likely will a see large amount of your material on the floor. Now go look near the panel table, and you will probably see the same thing. I am not saying it happens all the time, but it does benefit you if you aware that it does happen. My philosophy is this: If you can afford your daily habits and vices of black & milds, weed, strong drink and/or beer, going to the strip clubs to sit and posture like you've made it because you got your mix tape together, or even buying that fly expensive gear to fit in with the "in crowd", then you can change those habits and pour that wasted money into a professionally created promotional package.

As a former buyer/purchasing agent at a major music distributor, I used to get tons of packages on a daily basis of companies and/or artists that had sent their packages into the office, hoping that someone would come across it, discover it and/or them, and then pick it up for sale in our distribution network. I tell you all now that more than 99% never even made it out of the package, and if it did, the cd quality was horrible, the packaging was not up to par professionally, and more times than often once the cd became seperated from the package itself, it was lost forever. You see, the artist or company forgot to place pertinent contact information on the cd itself or even in the package. They seemed to think that a pretty picture of themselves or their artists was enough. Like we were going to have a bombastic idea to do a google search of the artist's picture and find them by that method. They would eventually end up in several filing cabinets . The only time they got touched again, was when someone needed a jewel case replacement for a broken one, from some promotional material they may have recieved from one of our vendors. That is the reality of not being prepared, and doing what it takes to seperate yourself from other artists or companies that are out here competing for that less than 1% of a million that get dicovered every year. Whether you are an independent company seeking distribution or an artist seeking a deal, you must be completely prepared. Seek out professionals that can assist you, and don't ever try to wear all the hats. There is no I in TEAM.

You need to have a professional or semi-professional promotional package. In this package you need to include a one sheet (detailed information about you, the cd, the key selling points, the upc code, addt'l info.), a black & white (professional) photo, a cd with j card insert (preferably mastered), cd/dvd business card (if your budget allows for this), a professional business card, a website to back up or support what you have on hand (not be your entire promotional package), and if you are selling cd's on sites such as Itunes, MySpace, Cd Baby, ect.. then you need to set up an account with Sound Scan, so that you can present any pertinent sales information that you have. Selling your cd's or mixtapes on the streets and all these mix tape sites I see is cool. But it will not hold any bearing with an industry professional you come across, if you don't have proof of those sales. And for those artists that have been lucky enough to get airplay, then I suggest you get registered with BDS, which tracks radio airplay. You will have this information (Sound Scan / BDS) included in the one sheet I mentioned above.


WHY DO I SEE NO PROGRESS?

First impressions are lasting, and a lot of artists have seemed to forgot or overlooked that old adage. You more times than often bump into these industry professionals by accident or just haphazardly even if at a conference or music event. You have just a few minutes, sometimes even a few seconds to get across to them what you are trying to promote, so be prepared, or you will miss your opportunity. Having your artists plastered all over the side of a hundred vans, rubbing elbows with industry artists or professionals (splurging your back account on them), or thinking that your inept knowledge about business (most times street business), will get you in the door, is the mistake that a ton of you are making out here. Radio has changed, the music industry has changed, technology has changed, so you need to update yourself to the changing environment of the industry and be prepared when the opportunity presents itself to you.
Everyone seems to think that CD Baby, MySpace Music Sales, Itunes, and other sites similar to them mean that you've made it, and forgo all the steps I have mentioned above. All it really spells out is that these sites are making money off of you, (sometimes 50%) and are not promoting anything about your music or artistry. I think MySpace is a great resource for everyone, and the fact that is has been a great tool for artists to utilize, is awesome, but depending wholly on MySpace is not going to get it done!!


I suggest reading this awesome, informative article on what record executives are looking for, what they expect, and their insight of the "new" music industry:(http://blog.wired.com/music/2008/02/maria-egan-cohe.html)


I consult on a contingency basis. I will help you put your music business plan and promotional package together, for your music business. Contact me at earthbrothersinc@gmail.com or 305-321-2895.

As each of you travel on your individual journey down the path of success in 2009 and beyond, I am hoping that you start taking control of your business, and treat your music career as such..

No comments:

Post a Comment