9781607749745

The completely revised and expanded edition of What They’ll Never Tell You About the Music Business is a must-have reference. You’ll learn:

- How many musicians have seized do-it-yourself internet opportunities to create successful business models,
- How the royalty pie is sliced—and who gets the pieces,
- How the fundamentals of music publishing, producing, managing, touring, and the record industry apply more than ever,
- Why this book is the indispensable guide to the worldwide music industry,
- How corporate general counsels can educate their employees (and themselves) to understand the strictures of copyright law and to avoid trouble,
- And much more.

PETER M. THALL has practiced law for more than 40 years and has represented many of the world’s greatest artists, from The Cars and Barry Manilow to ABBA and Pat Benatar, and such companies as Gucci, EXPRESS, and Victoria’s Secret for their music needs. He is a regular contributor to music journals, International law publications, and a frequent guest on national and international radio and television programsas an expert on the music business.

Contents
Preface x
Acknowledgments xiv

1 • Introduction 1
Selecting the Right Attorney 2
Personal Representation 3
Deal Makers: Why You Need Them 4
Deal Blockers: How to Get Past Them 5
Staying the Course or Calling It Quits 6

2 • Investors The High Costs of Low Finance 8
The Costs of Being Heard 8
Of Investors and Investment Agreements 9
Finding the Money 9
Internet-Specific Offerings 12
The Safe Harbor Disclaimer 12
Getting the Right Advice 13
Paying It Back 13
Overcalls and Conversions 14
Commissions 15
Crowdfunding 15
Should He Who Pays the Piper Call the Tune? 16
A Backer Who Knows What He’s Doing 16

3 • Advances Why They Seem a Lot Like Loans (and Vice Versa) 18
A Sad Story and a Happy Story About Advances 19
Is One Person’s Money Another Person’s Motivation? 21

4 • Royalties Some Unvarnished Truths 22
How the Royalty Pie Is Sliced and Who Gets the Pieces 23
Recording Costs 24
United States CD Album Royalty Calculation 25
Payment on Less than 100% of Records Sold 26
“New” Technology? 26
“Special” Categories 27
Two Diabolical Deduction Devices 30
Reducing Mechanical Royalties 31
Special Issues Regarding Controlled Compositions 32
The Beat Goes On: Other Important Deductions 33
Prepayment of Royalties 36
The Myth of Royalty Escalations 37
Free Goods 37
Lost or Misplaced Royalties 39
Chipping Away at Post-Term Royalties: Synchronization Licenses 39
Accountings, Audits, and the Statute of Limitations 40
How Responsible Should Record Companies Be? 42
The Effects of Digital Downloading on Pricing and Royalties 43
360 “Deals” 50
The Digital Evolution 57

5 • Personal Management The Whys, Wherefores, and Watch Outs 65
What a Personal Manager Should (and Should Not) Be Expected to Do 66
Managing the Five Stages of an Artist’s Career 67
Remakes 70
KMMA: Keep My Music Available—At All Costs 71
Choosing Your Manager 74
The Question of Clout 75
Paying Your Manager 78
The Term of the Agreement 82
Extending or Terminating an Artist-Manager Relationship 83
Breach of Contract in Artist-Manager Agreements 87

6 • Managing Your Business and Your Financial Future 88
When “Show Me the Money” Isn’t Enough 89 What a Business Manager Does 90
Finding the Right Person 90
Certified Public Accountants 90
Auditing the Auditor 92
What Kind of Business Is Being Managed? 92
Should You “Do Business as” or Form a Partnership? 93
Money Means Options: Resisting the “Keep ’Em Poor” Philosophy 98
Managing Your Money 99
Investing: Is Anyone in Charge Here? 100
Making It and Saving It 103

7 • When Your Job Is More than a Gig Employment Agreements and Disagreements 108
Term of Employment 108
Duties 108
Reporting Lines 109
Confidentiality and Competition 110
Stock Options 112
Perks 113
Termination 114
Working in a Foreign Land 117
Relocation and Re-Relocation 118
Visas 118
Disability and Death 118
Provisions That Survive Termination 119
Vacations 119
Release and Settlement 120
Employment Issues Specific to the Music Industry 120
Variations of Royalty Calculations 122
Employment Agreements with Celebrities and Others Otherwise Engaged 125
Mail 126
The Ownership of Ideas 127

8 • Record Producers Are They as Sharp as Their Points?    128
How 25% Can Equal 100% 128
Cross-Collateralization: It Does Not Apply to the Producer 130
Producers’ Royalty Provisions: The Basics 131
The Producer as Author of the Sound Recording 138
Producers and Neighboring Rights 138

9 • Getting Your Record Heard A Practical Guide to Marketing and Promotion 141
Marketing Tools 141
The Goal-Oriented Campaign 143
The Record Contract 145
Do Record Companies Know What They Are Doing? 149
Victim or Victor? 149
Television Campaigns 150
Radio Promotion 151
Airplay and Payola 152
The Same Old Song (Only the Coda Is New) 156
The Beginning of the End? 157
A Brief Look at the Promotional Picture—from the Artist’s Point of View 159

10 • Touring Concerns Trials and Tribulations 161
The Club Tour 162
The Grand Tour 163
Sample Tour Budget 164
Private Charter 172
Elements of Touring Agreements: Commonalities and Idiosynchrasies 177

11 • Merchandising Your Band, Your Brand 181
Tour Merchandising 181
Retail Merchandising/Web Merchandising 189
Confidentiality 193
Compliance with Local Laws 194
End-of-Term Inventory and Sell-Off 194
Artwork and Photographs 195
Coupling 195
Life and Disability Insurance 196
Piracy 196
Audits 197

12 • Audits Truth or Consequences 198
Examining the Audit 198
The Flow of Money 201
Access to Registration
Information 202
The Black Box or “Something Is Abyss Here” 202
Television Campaigns 203
Interest Charges 203
Statutes of Limitations 204
Conducting Audits in Foreign Countries 205
A Few Practical Suggestions 206
The Right to Audit: A Contract Issue 208

13 • Music Publishing The Odyssey of the Song 210
What Is a Music Publisher—and What Does It Publish? 210
Copyright: A Bundle of Intangibles 212
Financial Secrets and Realities 215
Mechanical Royalty Rates Outside of the United States 219
Top Gun—a Top Buyout for Paramount 219
The Administrating Function 221
Family Ties (Too Close to Sue) 222
When Your Publisher Forgets You 223
Foreign Taxes 224
At-Source Versus Receipts Deals 225
The Black Box Revisited 226
Copyright Reversions 227

14 • When Rodgers Meets Hammerstein Determining Songwriter Credits 229
Cowriting Agreements 229
Cowriters Who Are Band Members 231

15 • Being Your Own Music Publishing Company Pros and Cons 234
Self-Publishing 234
Getting in Touch with the Copyright Office 235
Why Bother Doing It Yourself? 239
Acquiring Copyrights 239
Reversion of Copyrights 240
The Value of the Copyright 241
The Impact of Administrating Costs on True
Earnings 243
The Cost of Giving Away a “Piece” of the Publishing 243

16 • Internet Entrepreneurship Doing It Yourself 245
Competing with the Big Boys 245
Artist, Songwriter, Performer—and E-Commerce
Expert? 246
Making a Living 247
Stealing and Protecting Against It 248
Dos and Don’ts of Internet Entrepreneurship 248
Manufacturing and Distribution 250
Kickstarting Your Career 251
Podcasting 252
Instantaneous Dissemination of Live Performances 253
Creating a Website 253
Which People Should Do It Themselves? 254
A Word of Warning—and Encouragement 255

17 • Lost, Misplaced, Neglected, and Abandoned Royalty Opportunities You Were Never Told About 257 An Introduction to Neighboring Rights 257
Broadcast Mechanicals 259
Neighboring Rights in Our Own Backyard: Canada 259
Lost, Misplaced, Neglected, or Abandoned: Which Category Are Your Royalties In? 260
Show Me the Money 263
Two Neighboring Rights–Friendly Countries: The UK and the Netherlands 263
Neighboring Rights Collections Agencies 264
Performing and Other Obscure Rights in Sound Recordings 266

18 • Urban Music The Beat Goes On 269
Roots 269
The Milieu 270
Urban Music: The Producer’s Cosmos 271
Different Strokes for Hip-Hop Folks 271
Rap as Protest 274
The Importance of the Mix: Mixtapes 274
Career Ceilings 275
Hip-Hop and Pop Culture 275
Business Management and the Management of Business 275
The Changing Image 276
Contractual Issues 277
The Rap Coalition: Self-Help Exemplified 278
Hip-Hop Rules 279

19 • Classical Music Dead or Alive? 281
A Little History 281
Demise or Rejuvenation? 282
The Metropolitan Opera 286
An Essential for Success: Spirituality 287
New Life for an Old Genre 289
The CD Arrives: Both a Blessing and a Curse 289
The Internet: Is It the Answer? 290
The Role of Record Companies 292
The Composer-Artist: Special Considerations 296
Classical Composers and their Publishers: Some Pitfalls and Some Options 297
Classical Management 301
Presenting the Singer 304
Music Education 305

20 • Termination of Grants of Copyrights For Every End, a Beginning 308
Basic Term of Protection 308
“K-K-K-Katy” 309
Termination of Grants 309
Duration of Copyright: Subsisting Copyrights 309
Who Can Terminate 310
The Control of Termination Decisions 310
The Rights Granted 310
The Windows for Termination 311
When Automatic Renewal Applies 312
The Sonny Bono Term Extension Act 312
Keeping Records 312
The Technical Requirements for Termination 313

21 • Compliance With Copyright Laws Hints for the Corporate Counsel   317 Intangible Rights and the Internet 317
Licensing From Music Publishers and Sound Recording Owners 318
Copyright Provisions Applicable to the Internet 320
Term of Copyright 322
Sampling, Borrowing, and Stealing 322
Rights Management 323
Dangerous Language Alert 323
Music Clearance: The Music Industry’s Revenge 324
International Issues: One-Stop Shopping 325
So Your Corporation Has Also Decided to Become Adventurous? 326

22 • Catalogue Valuation How to Improve Your Odds at Winning Big 327
Factors in Valuing Catalogues: An Overview 328
Satellite Radio, Internet Radio, Mobile Phone Streaming, and HD Radio 329
Evaluating Data 331
Who Owns the Catalogue? 336
Termination Issues 337
The “Trunk” 337
Who’s Sorry Now? The Blackbird 338

23 • Copyright Issues A Sampler   339
Changing Copyright’s Image 339
Copyright Infringement 341
Sampling 346
The Impact of the Internet on Recording and Publishing Agreements 348
How the Internet Has Provided Context for Songwriters’ and Publishers’ Search for Equitable Treatment 350
The Internet Is Global: So What? I’ll Tell You What 352
What Is to Be Done? 354
The Fairness in Music Licensing Act 356
The Copyright Term Extension Act: A Lesson in Leverage 356
MP3: How Two Letters and a Numeral Terrorized an Entire Industry 357
Napster and Post–Napster 357
The More Things Change, the More They Remain the Same (or Do They?) 358

24 • Copyright Can’t Live with It—Can’t Live Without It 360
Battles or Battle-Axes 361
Copyleft (aka Copy Wrong), But Not Copyright 362
The Clearance Nightmare 366
Copyright and Personal Property 369
Misuse of Copyright 371
Some Suggested Solutions 371

25 • Solving Piracy in the 21st Century How to Avoid a Greek Tragedy 376
Illegal Downloading 377
When an Apple Boomerangs 382
When Culture Trumps Commerce 383
Copyright Owners: Power (Not) to the People 384
What Would the Greeks Do? 388

Conclusion 389
Index 391

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What They'll Never Tell You About the Music Business, Third Edition The Complete Guide for Musicians, Songwriters, Producers, Managers, Industry Executives, Attorneys, Investors, and Accountants

What They'll Never Tell You About the Music Business, Third Edition The Complete Guide for Musicians, Songwriters, Producers, Managers, Industry Executives, Attorneys, Investors, and Accountants

1607749742

Summary

Author Biography

Table of Contents

Supplemental Materials