How iTunes Hurts Weird Al

Johnny X writes "Weird Al Yankovic recently said he makes far less money when you buy from iTunes than when you buy an actual CD. This guy did the math and showed that Weird Al could be losing up to 85% of his record sales income due to the 'weird' ways the record companies compute digital sales. Are all artists getting the shaft like this?"

Still getting the raw end of the deal?

Is the RIAA still in charge?

Re:Still getting the raw end of the deal?

Forget the RIAA, Weird Al's record label is definately the entity in charge.

I know you all hate the labels, but it doesn't make sense to assume they're stupid. They may be greedy, exploitive and unfriendly to their own customers, but "stupid" would not be a word I would use to describe them.

Weird Al said that he didn't really "get" the part of his contract that gave him far less money for digital downloads. He signed it anyway. That tells me pretty clearly that what Al didn't really "get" was the business of digital downloads in general. If he had, he woul have realized that paid downloads are increasing at roughly the rate of iPod sales and those iPod sales are through the roof. If he "got" digital downloads, he would have realized that 5 years from now digital could easily be a bigger business than CD.

The thing is, his recording label did get it. They got it so well that they presented him a deal that looks pretty good now, while CD sales are still king, but will totaly bite ass in the near future when downloads are more common than CD sales. Yes, they're little better than the slickest of con men who will tell you exactly how they will get your money in the same breath that they con you out of it, but stupid? Hell no. They're in charge.

TW

Re:Still getting the raw end of the deal?

It's been said before, and it has to be said again--the RIAA is merely a lobby group that represents the labels. The RIAA has nothing to do with Weird Al's contract; his label does. People have been mindlessly referring to "the RIAA" for so long that they think it's interchangeable with the music industry and any and all record labels.

This is a contract issue between Weird Al and his label. However, I expect most of the Slashdot discussion to devolve toward another generalized music industry bashing session instead of focusing on the actual topic here of Weird Al and his label contract...

Re:Still getting the raw end of the deal?

For good or for ill, the RIAA has come to stand for the music cartel in many people's minds. Call it the flexibility of language or the laziness of human mind, but when someone says RIAA, I don't just think of the lobbying organization, I think of the cartel.

I commend you for fighting for precision, but in this case I think you're trying to piss into the wind.

Re:Still getting the raw end of the deal?

but when someone says "stealing", I don't just think of shoplifting, I think of copying a song from a friend.

or, lord knows, whistling a tune, or even sitting in silence.

Re:Still getting the raw end of the deal?

Forget the RIAA, Weird Al's record label is definately the entity in charge.

It's kind of funny that the names of the companies involved haven't been mentioned, so I'll go ahead and do that: Al's current label is "Volcano" which is owned by "Zomba" which is owned by "BMG" which, of course, is part of the "Sony/BMG" ubercorporation...OMGWTFBBQ, I just realized! This is yet another anti-Sony story!

Re:Still getting the raw end of the deal?

So the money that Al's not getting might have gone to the rootkit programmers?

Step right up ladies and gents. Getcher tin foil hats here. Can't be a conspiracy theorist without the tfh.

Re:Still getting the raw end of the deal?

Weird Al said that he did not understand the reason that the contract was written to get him less money from online sales. He did not say he did not understand the contract, but rather the reasoning for it. In his words [weirdal.com]:

This is the one thing about my renegotiated record contract that never made much sense to me. It costs the label NOTHING for somebody to download an album (no manufacturing costs, shipping, or really any overhead of any kind) and yet the artist (me) winds up making less from it. Go figure.

Re:Still getting the raw end of the deal?

In America, where I'm pretty sure he signed it, the responsibility is on you, not anyone else, to make sure you understand your contract. Unless he is mentally handicapped and they were clearly taking advantage of him (which is not the case for him) then he had every opportunity to keep asking them until they explained, or hire a lawyer to explain it to him.

He makes more money than most people ever will, I don't feel bad for him because he's too dumb to make shitloads more.

Have you ever seen a record contract?

Have you ever seen a record contract? I work in the recording industry and I have.

They are usually about 70-90 pages of small print which are "the result of the accumulation of thousands of lawsuits through the years".

These contracts are written to minimize liability for the label and obviously maximize return. However, there is always a "this contract applies to any current, future, or past medium of distribution, seen or unforeseen etc..." clause written in. It is up to the artist and his attorney to negotiate that out of the contract if they feel the need to.

Re:Still getting the raw end of the deal?

Musicians are not typically very business savvy people. There are exceptions of course, but it's a general rule. Even a successful musician is unlikely to be able to afford more than one lawyer and one accountant. The labels on the other hand have vast teams of people insuring that they squeeze every cent out of their talent and customers. The record industry has been pulling this kind of sneaky contract shit since the 20s to rip off talent.

Re:Still getting the raw end of the deal?

Even a successful musician is unlikely to be able to afford more than one lawyer and one accountant. The labels on the other hand have vast teams of people insuring that they squeeze every cent out of their talent and customers.

Why does this always become an explanation? I don't get it. I'm not a lawyer, but when I signed an employment contract, I read it over first, line by line. When I signed a loan contract, I read it over first. When I have *any* contract in front of me, I take the appropriate amount of time to read it over, mark *anything* I don't understand, and then research it. It takes a ton of my time up, and people even get pissed at me taking too long sometimes. But you know what? I know what I sign, and I agree with what I sign. If I don't, at the end of the process, I won't freaking sign it.

Do the damn research before you sign a contract. I have no pity for anyone who's signed into a bad contract. I've done it once, because I was in a hurry, but my one rule is that the contract is either limited, or there's an acceptable way out.

Re:Still getting the raw end of the deal?

'but "stupid" would not be a word I would use to describe them.'

Of course, by engaging in the rampant exploitation they do they undermine any reason for the law to protect their monopoly rights, effectively proving that the artists and creators would be better off with a pure taxation/incentive construction, and letting the free market drive prices on distribution, marketing and production.

Sawing off the branch you're sitting on falls squarely under the heading "stupid", in this case, greedy-stupid, as their long term prospects arent particularly good.

Raw end...hah!

But, here's my thing. Saying that a wildly successful artist (like Weird Al definitely is) is aggrieved by a distribution that, OMG, reduces the profit per sale of his songs, is like saying that professional baseball players are aggrieved when there is a absurdly high salary cap installed; yeah, its technically true in the sense that they aren't quite as filthy rich as before, but I won't weep that much for them.

OTOH, there are those artists, let us call them the 'filthy rabble (tm)' who aren't successful, and under normal circumstances wouldn't generate enough sales potential to justify to a record label the cost and risk of publishing their work. For these folks, an electronic distribution model is the only likely way for themto ever hope to get content to potential consumers.

Point the third, its not like sucessful artists don't have leverage when dealing with major labels. Volcano, which is Weird Al's label, was embroiled, for example, in a contarct dispute with Tool, another wildly successful band. Tool, after a protracted argument, prevailed in most of the ways that matter. Artists can leverage their potential future sales to benefit them in contract negotiations, and they do it all the time.

There is plenty to complain about in the music industry, and the RIAA and the labels on behalf of whom they lobby are in many ways foolish in their relatively unenlightened pursuit of bare self-interested greed, but this, I do believe, is not a good example of that trend. It is simply a successful artist going through the relatively painless 'pain' of adjusting to a new distribution paradigm. There are better thinsg to complain about (like pushing very short sighted DRM schemes that treat all customers like would-be criminals rather than treating them, oh I don't know, well). P.S., I like Weird Al's work; he's a hell of a satirist.

Re:Raw end...hah!

Sorry but you're wasting your time. Only musician-victim vs corporation-bully views are allowed here.

You have to remember, musicians are poor feeble minded creatures who are lured into dark corners by executives in suits to sign their filthy contracts. They shouldn't be expected to prove their talent up front and build up capital and resources like the rest of us, they're special.

Re:Still getting the raw end of the deal?

1) Great Singer
2) Very clever paraodies.
3) Albums contain a slew of hilarious original songs as well.

Time for a new song

Sounds like a good opporitunity to write an R.E.M. parody... "Losing my Commission"

Re:Time for a new song

...
That's me on their ipod
That's me on i - tunes
Losing my comission
Trying to keep up with tech
And I don't know if you can do it
Oh no you took too much
I haven't got enough
I thought that I heard price-fixing
I thought that I heard you steal
I think I thought I got ripped off ...

Re:And if you want to be really charitable

Nope.

In fact, by even posting it on Slashdot, they've pretty much ensured that Weird Al would never make the song.

From the FAQ section of his site (http://www.weirdal.com/faq.htm [weirdal.com]):
"Can I send my song ideas to Al?

Sorry, for legal and personal reasons, Al does not accept song ideas from fans (he's got plenty warped ideas on his own!) You might try following in Al's footsteps by recording your songs and sending them to Dr. Demento - maybe you'll hear yourself on the radio!"

I've never met him, but I'm told that he's a really cool guy (a family member of mine who was working security at one of his shows talked to him for a bit). And of course, being the diehard fan that I am, I have quite a few of his albums.

-- Joe

Re:eat it eat it

He didn't seem to be complaining. He merely said he didn't understand why they want to take more out when there are fewer distribution costs.

Re:eat it eat it

Actually, a lot of artists never got to sign for digital.

For example, with web/digital radio. RIAA bought off Congress so that they could collect royalties for all music played over webcasts. Guess what, my friend's band whom I'm the manager for...never got to negotiate.

RIAA is !@#$% up....

Re:Well duh

If people don't like the price they can go without. That's your system is it? How about competition?

Um, I didn't say go without music. I'm saying go without the artists whose music you think is too expensive. Go with artists who are cheaper. Competition is there; artists compete with each other for fame and fortune. You have a choice between them, and you base your decision on (A) the quality of their music and (B) the price of their music. How is this any different from other industries where competition thrives? You might think that a Ferrari is a nicer car than a Toyota Camry, but you "can go without" the Ferrari because the Camry is cheaper.

If the record companies were required to license their songs to multiple manufacturers and you had a choice between which of them you bought the CD from you don't think the prices would be lower?

What would be the point of this? Record companies would simply license the songs at "high" prices, and then the CD manufacturers would pass the cost on to consumers.

Cuplrit?

TFA seems to blame iTunes, at least at heart. Wouldn't the actual problem here be the messed up, backwards, hacked way the (MP|RI)AA have decided to handle this newfangled technology called the internet?

Re:Cuplrit?

Actually, I thought the analysis seemed to blame everybody: iTunes for charging 30+ cents per dollar for their web services (that surely does seem high, which makes me wonder if the mentioned 80/19 split isn't more accurate), the record company for not splitting their cut more fairly with the artist, and the implied blame of Al for signing what seems on the surface to be a pretty lousy deal.

Culprit

If you are going to say something like that, please actually read the article.

"Apple did work, and got paid for it. You did an arguably larger portion of the work, by creating something people wanted to buy in the first place, so Apple got a little money, and you got a good deal more."

He is saying here you did work, they sold your work, they take a cut and pass the rest back. Fair enough. However he goes on to say "Unfortunately, that's not how this version of the universe operates. So Apple sends the check to your record label."

And he then goes on to discuss where the money goes to the record label.

The conclusion he reaches is basically "If all of your fans bought through iTunes rather than buying CDs at the record store you'd be looking at an overall reduction in income of 85%!" however he is quite clear through the article that the record companies take a lions share of that money

Moving from fact into speculation, let's examine what's happening here

Case 1:
Man records songs, Record label puts work into creating CD labeling, packaging, promoting and so on. Record label organizes with Distribution company to sell CD's and gets money in return.
Cost of Final Product: $15-$20.

Case 2: Man records songs, Record label puts work into creating CD labeling, packaging, promoting and so on. Record label organizes with itunes to use all the fancy stuff they created for the CD and sell the product over Itunes.
Cost of Final Product: $0.99 * songs or $10, whichever is less

The same costs are involved in doing both. Until artists only release online, the CD cost will have to be recouped as well anyway, so it shouldn't be a huge shock to anyone that the cheaper product provides a worse return on investment for the same work.

Re:Cuplrit?

Agreed. Here's what I understand.

A consumer buys a record on iTunes for the flat $10 price. Apple takes its cut (30% or $3.00) but gives the rest to the record company. The record company takes out costs and then gives the artist a small percentage. For our example, let's say 10% or $0.70 goes to the artist.

If the consumer had bought a $10.00 CD instead, the record company would still take the same of costs in terms of percentage but Apple would not have taken the first piece out. The artist would have gotten $1.00 in royalties.

On the surface, it seems contradictory that artist would get less with iTunes and it would seem that Apple is to blame. The real culprit is what the record company considers as "costs." Every contract allows the record company to take out costs before royalties are paid. Traditionally the costs for the record company were things like distribution, marketing, and packaging for CDs and tapes. These were not minor costs.

But in terms of digital downloads, Wierd Al (and other artists) are complaining that the record companies are taking out these traditional costs as if the work had been sold as a traditional CD or tape. What the record companies are doing are simply taking out the same percentages insteading computing the real costs.

If the record companies had computed real costs for distribution and packaging for a download, it would have found that they are next to nothing. The artists should receive more. This is due to either the record companies not updating their accounting to deal with digital medium or purposefully shorting the artists. As a pessimist, I would think the latter.

So what's new?

Record companies find ways to give artists even less money. You knew it was going to happen. To the record companies, it is not about the music, but the money. Since the early days in the 50's they have been writing draconian contracts, then stealing the copyrights from the artists (remember the "musicians are craftsmen not artists" argument they were throwing around) and now this. Pretty soon, the artists will have to PAY the record companies for the priviledge of getting screwed.

Re:So what's new?

Pretty soon, the artists will have to PAY the record companies for the priviledge of getting screwed.

They already do, actually. Read up on record contracts sometime. Many artists end up in massive debt due to their contracts and have to tour endlessly to pay it off. Fuck major labels. I'd trust Satan before I trust a record label.

Re:So what's new?

Satan runs a record label.

In Satan's defense...

...they do put out some good albums.

The Shaft

Isn't this interesting, after all the noise the industry made about going after illegal music downloads, all in the name of helping the artists. They then turn around and pay the artist next to nothing for the iTunes download you are supposed to buy because you want to 'support the artist'.
Musicians will continue to "get the shaft" as long as they rely on majors.

Re:The Shaft

Musicians will continue to "get the shaft" as long as they rely on majors.

One of the best references on the subject: Courtney Love Does The Math [jdray.com].

Re:The Shaft

I would also recommend Steve Albini's piece The Problem With Music [negativland.com].

Re:The Shaft

I don't believe in a free market, because "free markets" invariably transfer control from a (largely) unrepresentative ogliarchy of politicians to a (totally) unrepresentative ogliarchy of corporations. Yeah, I know, vote Cthulhu - why go for the lesser of two evils? The "free market", as implemented, needs so many constraints and so much oversight in order to prevent it from degenerating totally that it's not meaningfully free anyway. It's better than a lot of alternatives, but that's only because the alternatives would make a satanist green with envy.

Really, there is almost no real way of supporting an artist. There are way too many hands dipping into their pockets. That's possibly why labels were so keen on artists getting high on drugs in the 60s and 70s - easier to steal from, if they're not concious. Even adding a token of appreciation in fan mail would be unlikely to get through. Whoever has been hired to answer the mail would be more than able to lift it without anybody being any the wiser.

If there's a workable solution, then it will require some major restructuring of how things are done. The existing mechanisms don't cut it and cannot be patched to cut it.

Slashdot is going to hate this...

There are very few people who actually have any taste in music. The vast majority of music purchases are made by shleps buying whatever is on the radio or MTV. So who is on the radio or MTV?

Whoever the record labels SAY should be on the radio or MTV.

So, no reason to pay the artists anything - if the artist you're talking to doesn't want to take a small percentage of the record sales, then you just find somebody else who will, make THEM the star, and then they can rake it in on concert ticket sales.

People do not understand that pricing has NOTHING to do with what it costs to provide a service. It has to do with what people are willing to pay to get a service. And most new artists are willing to pay the vast majority of their record (or download) sales to have the services of a record label.

Also, the article is wrong about WHO is getting the artist's money. The money the artist isn't getting isn't going to the LABEL, it's going to the CONSUMER:

Price of Al's CD on Amazon: $14.98
Price of Al's CD on iTunes: $11.88

That's a difference of $3.10. Al 'apparently' loses $0.27 per song (not $0.265, article has rounding problems). $0.27 x 12 = $3.24!

So, when Al comes up short $3.24 because a consumer got an album for $3.24 less on iTuns than on Amazon, who got that $3.24?

The CONSUMER did!

Now, I'm not saying this is FAIR. Clearly, the record label is making much more money on iTunes sales since, as mentioned, they don't have to pay for a lot of things they would if they distributed music by physical CD. But... why should Al get any of that? Al has agreed to pay the record company a certain amount for the record company's services. The record company gets the same amount whether the CD is sold online or on the shelves. If Al doesn't want to lose money to his stuff being sold on iTunes, he should renegotiate his contract to not allow iTunes sales. I bet most artists wouldn't do that though, because they make most of their money on concerts, and being on iTunes helps them sell tickets.

The *REAL* problem here is not that Al isn't getting more money. The real problem is that the CONSUMER is still paying the record company CD distribution prices instead of digital distribution prices. In a free market, we would expect digital downloads to be much cheaper than $0.99, because the various distributors would compete against each other reduce the inflated margins the record companies (and iTunes) are getting based on CD priving. But since iTunes is a fairly insulated monopoly at this point, even though the CD *COSTS* of distribution have gone away, the CD *PRICING* hasn't.

So, who is REALLY at fault for the artist getting no money AND the record company and iTunes still getting full price?

APPLE! They've set the $0.99 price and are putting no pressure on the record labels to lower it.

Read it on "Wierd Al's" actual website

Submitter's (?) blog references this, but here is Weird's Al's website [weirdal.com] where he actually talks about it ... his response on this topic is the 4th bold one down.

Re:Read it on "Wierd Al's" actual website

In cases like this, I'm all in favor of the editors modifying the submitter's links. Not only does Aaron Hockley's blog offer no more information than what he submitted to Slashdot, but in his "Blogging" cattegory he clearly states that he's actively engaging in this sort of activity for his own personal benefit (don't bother, it's not worth the look nor the additional clicks to his 'blog').