MIDEM Blog—Artists Still Need Label Services

Indie panel at MIDEM featuring Tommy Boy CEO Tom Silverman, Martin Goldschmidt with Cooking Vinyl Group, Kenny Gates with PIAS recordings, Emmanuel de Buretel with Because Music, and Colin Daniels with an Australian indie label.

Sunday, Feb. 2, 2o14

The International Association of Entertainment Lawyers held seminars all day on Sunday. The group is busy with legal wranglings over anti-piracy efforts.

In the United States, the major issue is the consent decree granted to ASCAP and BMI, which allows for blanket licenses to represent all of American song publishers. The issue has been contested because several publishers, starting with EMI, withdrew their new media rights from ASCAP and BMI and negotiated directly with iTunes. Others followed and then Pandora filed a motion against ASCAP to lower their fees. That has gone to court and a ruling could invalidate the earlier publisher withdrawals.

What is at stake is whether music publishers “can cherry pick what rights to license,” explained Deborah Newman, an attorney with MusicStrat, who spoke at the morning session. “The issue is now in freefall.” She said a possible outcome could be “the publishers give whatever rights they want to whoever they want.”

The other major legal issue facing American music publishers, according to Newman, is whether downloads from iTunes are sales or transfers.

Attorneys from around the world gave brief overviews of the major legal issues in their countries. Those issues tend to coalesce around anti-piracy, the taking down of web sites violating copyright law, and whether the consumer, the infringer or the intermediary (like the ISPs) should be the target.

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A seminar on Independent labels was moderated by Tommy Boy CEO Tom Silverman (who also serves as Executive Director of the New Music Seminar) and featured Martin Goldschmidt with Cooking Vinyl Group in the U.K., Kenny Gates with PIAS recordings in Belgium, Emmanuel de Buretel with Because Music in France and the U.K., and Colin Daniels with an Australian indie label.

The panel confronted the belief that “artists don’t need labels,” and explained that musicians need “Artist Enabled Services.” Case in point, said Silverman, is Macklemore & Ryan Lewis, who won a Grammy and proclaimed from the stage they did it without a label. Macklemore had an entire team working with them because “you can’t achieve that level of sales and success by yourself,” said Silverman. “They say they don’t need a label but they needed partners to provide marketing, promotion and publicity and those are things that a label does. Now, the perception is that they did it all by themselves so every artist will believe they can do it on their own.”

The role of a label has changed a great deal, and an independent label “does what an artist doesn’t do, can’t do, or doesn’t want to do,” said Colin Daniels. “We do everything an artist needs done. We even promote concerts and handle merchandise.”

“We’re not a record company now,” echoed Silverman, “we are a music company.” Some who call themselves a record label are actually companies that provide services such as promotion, publicity, or publishing administration for a fee.

“At the end of the day,” said Kenny Gates, “it’s all about relationships. For a while everybody talked about DIY and you don’t need a label. But you need a partner. These artist and label services are partners—and that what a label does. You DO need a label!”

The indies are proud of the fact that they stick with an artist longer than the majors. “It takes five to seven years to break an artist,” said Emmanuel de Burstel with Because Music. “Major labels spend three or four months working an artist and if they don’t hit, they go on to someone else. They have so many artists and so much to do so if an artist doesn’t hit quickly, they drop them.”

Silverman touched on changes at the annual conference: “MIDEM used to be the center for licensing music all over the world. People came with headphones to listen to music for licensing deals. Now, labels make deals for multiple territories by striking a deal with iTunes… People now think that distribution is marketing, but unless you have a partner to help break an artist in a territory, you have nothing.”

Colin Daniel noted that “People used to come to MIDEM once a year to get licensing and distribution done. Now I travel all around the world during the year to get license and distribution deals.”

Daniel also told the story of an indie artist who is “the hardest working artist I’ve ever been involved with.” The artist used to busk wherever he played a show. Years later, the act sells out venues, has sold almost two million albums—but still busks in whatever town he’s in. “The difference now is that we have to hire security,” said Daniel.

Silverman noted that “tech companies are looking for content, not music.” Colin Daniel said he was comfortable dealing with Beats and Spotify “because they’re music people. Google isn’t music people. Spotify wants to work with us but Google just wants to use us.” Martin Goldschmidt with Cooking Vinyl Group, noted that YouTube is the fifth largest revenue stream at major labels so Google is paying for the use of music. Still, Google often comes up as the bad guy in many discussions. “Google monetizes attention—how many eyeball are watching—but they’re getting that attention from our music,” said Goldschmidt. “Facebook is using everything we do.” He also noted a decrease piracy in recent years because “people don’t need to pirate any more—they can get everything streamed or on YouTube.”

There have certainly been major changes in the music business during the last decade, but Colin Daniels insisted that “it comes down to music. That hasn’t changed and it never will.”