Task 5

Distribution and ownership of Music / Music video

Task 5

The Virgin Media executives have requested that you now produce information to show them how two recording artists from rival media corporations Time Warner and Sony are being distributed. This will enable them to see exactly what the competition is. You need to compare the distribution channels of these two recording artists. You will produce a flow diagram and write a conclusion about your findings.

A Music Label is…

In the music industry, a record label is a brand and a trademark associated with the marketing of sound recordings and music videos. A record label is also a company that manages such brands and trademarks; coordinates the production, manufacture, distribution, promotion, and enforcement of copyright protection of sound recordings and music videos; conducts A&R; and maintains contracts with recording artists and their managers

Who gets da money?

There are 4 main ways that an artist will get revenue from his/her writing

1. Mechanical Income. This is the income derived from using a song on a record, CD, cassette or other form of release of the song such as downloads.

2. Performance Income. This is the income earned from "performances" of the published work from radio, television and live performance. It includes music played in amusement parks on background PA systems, and other public arenas.

Who gets da money?

Sheet Music Income. This is the income derived from licenses granted to especially the major print publishers (This will be only songwriters.

4. Synchronization Licenses. This is income derived from uses of the published work utilized in television shows, movies, commercials. In other words the producer, or owner of the program licenses the right to use the music within the intended work.

Who owns the music?

This is not as straightforward as we might think.The artist will have some rights. The songwriter will have some rights.Some musicians will have rights, although usually they will have relinquished their rights in a flat fee (session artists).

Having some ownership over the rights entitles the owner to receive revenue.

Song writing royalties- How do the major players work?

A song writer writes the lyrics and melody of a song and registers the copyright (if he/she feels its going to be a hit) to prevent any infringement problems.

The songwriter then signs a single song agreement with a publisher who will ‘pitch’ the song to the record companies by issuing a ‘mechanical licence’ to recording companies or others who want to use the song.

Song writing royalties- How do the major players work?

In exchange for this, the publisher will get 50% of mechanical royalties for each recording sold.

First of all, check out the websites for Sony and Time Warner and look at the music divisions of the corporations, choose a recording artist from each record label and find out information for your flow chart.

First of all establish the following…

Where are Sony and Time Warner based?Are Sony and Time Warner international

corporations?Have Sony and Time Warner merged with

any other music corporations?Are Sony and Time Warner Cross media

organisations? (do they have divisions in other forms of media besides music?).

How are the artists from each label distributed? E.g made available.

Retail outlets e.g, supermarkets, HMV etc…

Television networks, terrestrial, digital etcInternet sites such as Amazon, Itunes,

Youtube etc…Cinemas & radio stations (these may be

specific to that subgenre of music)

Compare the target audience of each artist

How far is the artist aimed at a niche market (look at things like type of music channel/ radio station / chart position).

Which artist is most financially viable (compare sales figures of each recording)

Are the needs of the audience/ consumer being met in terms of content of music video/ distribution.

Globalisation- How successfully has the artist been on a Global level (check out sales/ chart positions in other countries)

Check out if they are available for download on foreign versions of internet sites.

Once you have found out the above information, make two flow charts to compare each artist and label. Then write a conclusion summarising your findings. Here is an example of a flow chart examining the ownership of Elvis’s ‘A little less conversation’

Revenue FlowArtists(Ownership)

Revenue FlowArtists(Ownership)- song writing royalties

SongwritersStrange / Davis

A Little LessConversatio

n

Elvis Presley

Enterprises

Artist:Elvis

Presley

CKX, IncLisa Marie

Presley 85%15%

JXL

RoadrunnerRecords

How music royalties work- this will help you to complete your song writing revenue chart for unit 1 task 5

The songwriter records that song in his basement and sends the tape to the Library of Congress to register the copyright. Even though he knows it is automatically copyrighted when he set it in a fixed form (put it on paper and/or recorded it), he is registering it because he's sure this song has the makings of a hit, and he wants to head off any infringement problems up front.

Our songwriter signs a single-song agreement with a publisher who will pitch the song to the record labels. Publishers are in the business of finding and exploiting new music by issuing mechanical licenses to recording companies or others who want to use the song in some fashion. In exchange for this "administration," the publisher gets 50% of the mechanical royalties for each recording sold (minus several things they have to pay for first, which we'll talk about in the next section).

Let's say that a major record label likes the song and has the perfect recording artist to sing it. They fill out a mechanical license agreement

The songwriter and publisher split mechanical royalties 50/50 for each recording sold, and the recording artist also gets a mechanical royalty

In addition to the mechanical royalties, however, our songwriter and publisher are also paid performance royalties, which means they make money based on how often the song is played on the radio, in restaurants or bars, or in other types of broadcasts. These royalties are monitored, collected, and paid out by a performing rights organization like ASCAP, BMI,

or SESAC

Song writing royalties continued.

Now, let's say that a movie producer is working on a new movie and wants to use the song in a scene. Now the song is moving into the realm of synchronization royalties (where music is used in conjunction with video). When a songwriter's work is synched with a scene in a movie, played over the credits at the end of a movie, or used in a television show or commercial

the songwriter and publisher are paid a negotiated fee to use the song in the movie as well as performance royalties when the movie is shown on TV or in theatres in foreign countries. If the movie uses the specific recording of your song (known as a "master") made by the artist who made the song famous, then that artist will receive a regular royalty percentage from the fee the movie company negotiates with the record company as well as mechanical royalties if there is a movie soundtrack produced.

Source (how stuff works) song writing royalties.

Recording-artist mechanical royalties

Artists are paid royalties usually somewhere between 8% and 25% of the suggested retail price of the recording. Exactly where it falls depends on the clout of the artist (a brand new artist might receive less than a well-known artist). From this percentage, a 25% deduction for packaging is taken out (even though packaging rarely costs 25% of the total price of the CD

Free goods - Recording artists only earn royalties on the actual number of recordings sold -- not those that are given away free as promotions. Rather than discounting the price to distributors, many record companies give a certain number away for free (about 5% to 10% depending on the artist). Recording companies also give away many copies to radio stations as "promo" copies. There is also a reduction in royalties made for copies of the recording sold through record clubs.

Return privilege - Recordings in the form of CDs or cassettes have a 100% return privilege. This means that record stores don't have to worry about being stuck with records they can't sell. Most other businesses don't work this way, but the music industry has to be more flexible and timed to demand. What's hot today may be forgotten tomorrow... This leads us to reserves. The recording company may hold back a portion of the artist's royalties for reserves that are returned from record stores. (Usually about 35% is held back.)

Sony Music Entertainment

BMG Entertainment

Sony BMG Music Entertainment

RCA Records

Bertelsmann AG Sony

50% 50%

Distributors Hierarchy

A Little LessConversation

“CD” Sales

“Synch”TV / Film

Downloads

RetailOutlets

OnlineStores

Ocean’s11Nike

Ad

Singles

Albums

iTunes

HMV

Distribution Channels

MusicTV

VH1The Hits