Monday, July 14, 2008
Cream The Music Industry's New Normal
Posted by Tracy Moore on Mon, Jul 14, 2008 at 11:36 AM
Here's a piece I came across about Music Row's slow-core evolution in adapting to the seismic shift toward digital sales. It's a lot of what you already know: CDs aren't sellin' like they used to, people aren't gettin' rich like they used to, new media companies are sproutin' up like toadstools and it's a new era in the biz. But hey, at least Music Row is finally ready to get with it, thanks to artists such as Taylor Swift, whose Internet-savvy marketing paid off.
But it was this little paragraph that caught my eye for its nice breakdown of the way money allocation works for songwriters (courtesy of Songwriters Guild of America prez Rick Carnes). And since everyone had a good go at The Pink Spiders' publishing hot potato recently, I thought it might be of interest:
It goes like this: By law, a songwriter is entitled to 9.1 cents for every song sold, giving him a starting point of $91,000 if an album sells a million copies. A publishing contract eats up half of that, reducing the figure to $45,500. That sum is typically split in half again because many artists won't cut a track on their album unless they receive a co-writing credit. That money is often used to pay back the initial investment made by a record company. That now leaves the songwriter with $22,750. But included in most standard record deals is a clause that pays co-writers only 75 percent of their congressionally mandated royalties, leaving a grand total of about $17,000 in a songwriter's pocket.
Comments (12)
Showing 1-12 of 12
dont play music to get rich or become famous.
play music because it feels good
if the rich and famous thing does happen, well, it will be nice. your chances of winning the lottery would be greater.
it cracks me up to hear newcomers talk of dreams of being a star. it makes me cringe actually. these people come here and actually think there is a chance. there is more chance they will be hit by a flying hot dog.
the music industry is changing. we are changing. be sure to keep your day job
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but i read this book called 'the secret' that says i am going to be huge...in America!
Isn't this proof positive why you HAVE to tour as a band to make any amount of money? Merch sales tend to lean a bit more in favor of the artist, no?
that excerpt covers mecahnical royalies - i.e. physical cd sales. The writer stands to make a ton more for a single i.e. radio/video performances. The "writer" (50%)portion of that (BMI/ASCAP/SESAC)money goes directly the writer. The "publisher" (other 50%) share goes to the to the publishing company (if the writer is signed) or is split if the writer has a "co-pub deal".
If the writer is signed, they get a salary and see 0% of mechanical royalties until they are re-couped. A #1 single will pay the writer in the neighborhood of 100K(sometimes much more)depending on how much it's played and how many people wrote the song.
Radio doesn't pay the label, publisher, or the songwriter.
Video is simply a promotional tool for the label.
No money is made from the video.
I think you mean syncronization royalties. Those one time deals that have to do with using the song in movies, commercials or tv shows.
Mind you it's been a year since my last RIM class. Could be fuzzy on the details. I'll check my sources when I get home.
Actually "Anonymous" you're really fuzzy. radio pays the PROs who in turn pay the writers and publishers. When videos get played on TV (which barely happens these days), the TV station has to pay a performance royalty to the PROs which is, again, split between writers and publisher. A LABEL makes no money off of a video, but all three (Label, Pub, Writer) make money off of sync liscensing, because there are two different licenses involved (the actual sound recording and the underlying song).
so if i make an album and write all 15 songs and it sells a million copies i get $511,875? Or I co-write them all i get $255,000? I mean that's not thhaaat bad right? And that's without Radio/TV/Movie royalties. I mean that's a lot of hot dogs to buy.
Well, you're chances of selling a million copies are virtually non-existent in this day and age...
If you sell a million copies, you should make more than that! If you have recouped the marketing expenses, you should make between 1-5 dollars a record. 5 dollars being the max as a self release, new model formula that is management based and an imprint label formed around the band. That has nothing to do with the publishing, that is money on top of the sales, same with performance rights, that is additional money on top of publishing and record sales. There is still money to be made in the music business. there is hope. And you dont have to win the lottery either. Yes, selling a million copies is not happening really that much anymore, but there is money out there and for once its starting to go to the artist. So actually there is more money now for the artist than ever before.
Thanks Ryan, that was like telling me that if I get struck by lightning I'll fart thunder. Seriously helpful. I feel so much better about the state of the industry now that you chimed in and soothed my fears with nary a fact nor reference to support your claims. You're really excited about being eligible for RIM canidacy aren't you? Sophmore year will totally rule, bra.
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