New York Times
Music Artists Take On the Business, Calling for Change
By BEN SISARIOJULY 31, 2015
Musicians are known for speaking out on issues like human rights, politics and the environment. They are less known for speaking out about how the music business itself should operate.
That may be changing.
When Taylor Swift publicly rebuked Apple in June over royalty payments, the company reversed its position and Ms. Swift’s move was celebrated throughout the music world as a victory. But it was only the most prominent example of a growing trend of industry-focused activism undertaken by a range of artists, from big stars who take a principled stand to middle-class musicians who need to worry about paying the bills.
“We’re at a turning point,” said the singer David Byrne, formerly of Talking Heads, who has been vocal on the economics behind digital music. “Musicians, their managers and many others are frustrated. The black box of hidden transactions in the music business, while maybe not illegal, is a recipe for chicanery.”
The activism has taken different shapes. Jay Z, for example, paid $56 million for the subscription streaming service Tidal, though his efforts to market it as an artist-friendly alternative have been criticized as clumsy. Prince, Neil Young and Ms. Swift have withdrawn their music from some streaming outlets, and various musicians have called for greater transparency in how the music industry operates.
Over the last few weeks, dozens of acts, including R.E.M., Common and Chuck D of Public Enemy, took to social media to support a bill that would require radio stations to pay royalties to performers.
The debate has been enabled by social media and reflects changes in many artists’ attitudes toward the online economy over the last 15 years or so — a period that stretches from the rise of Napster and iTunes to online streaming outlets like YouTube, Pandora and Spotify, and has been accompanied by enormous changes in how money flows through the industry.
“The support that we’re seeing, in terms of the range and number of artists, whether it’s from somebody who’s a working-class musician to somebody who’s very successful, it’s unprecedented,” said Ted Kalo, the executive director of MusicFirst, a lobbying coalition that includes record labels and musicians’ groups and that helped organize the social media campaign.
The economics behind downloads is relatively simple: Typically about 70 percent of a song’s retail price goes to a record company, which then pays its musicians according to its contracts. But with streaming, the system is complex and often opaque, as became apparent in May, when an outdated licensing contract between Sony and Spotify was leaked online, showing the elaborate formulas used in computing streaming rates.
Public relations missteps in the early 2000s kept many musicians from speaking out about economic issues, artists and executives said. Those include the music industry’s lawsuits against thousands of fans for online file-sharing, and the pillorying that the band Metallica received after it sued Napster for copyright infringement. But the shift toward streaming in recent years has prompted many musicians to investigate the changes in the business and comment online. Among them are independents like David Lowery of the band Cracker; Zoë Keating, a cellist who has documented her online royalties; and Blake Morgan, a singer-songwriter who owns a small record company and started an online campaign, #IRespectMusic, to draw attention to the issue.
At the same time, musicians and songwriters of all stripes have begun to complain, often bitterly, of low royalty payments from streaming music. Last year, for example, Bette Midler spoke out against Pandora and Spotify, and Aloe Blacc said that he earned just $4,000 in songwriting royalties from 168 million streams on Pandora of Avicii’s hit “Wake Me Up,” which Mr. Blacc helped write.
In response, many streaming outlets point out that their actions are a legal and rapidly growing source of income for the industry as sales of CDs and downloads plunge. Pandora says it has paid nearly $1.5 billion in royalties since it started a decade ago, and Spotify, which went online in 2008, says it has paid $3 billion. Yet how much of that money makes its way into musicians’ pockets remains hotly debated.
Melvin Gibbs, a jazz bassist in New York who is the president of the Content Creators Coalition, said that declining royalties — he recalled once getting a check for 3 cents — were a factor that led him to study the business models of Internet companies that offer abundant music free or at low subscription prices.
“None of these companies that are supposedly in the music business are actually in the music business,” Mr. Gibbs said. “They are in the data-aggregation business. They’re in the ad-selling business. The value of music means nothing to them.”
Several years ago Ms. Keating, who controls her own recordings, began posting detailed royalty statements from Spotify, and she has also reported on private negotiations with YouTube in which that company appeared to pressure her into signing a contract for its new music-subscription service.
Despite growing complaints from middle-class musicians, it is still the stars who have the most impact. As Apple prepared last month to release its new streaming service, Apple Music, independent labels around the world said that the company’s refusal to pay royalties for trial streams was unfair. But Apple did not budge until Ms. Swift scolded the company in a blog post — whereupon Apple changed course in a matter of hours.
Lobbying has become another battleground. In April, the Fair Play Fair Pay Act was introduced to Congress, which would require AM and FM radio stations to pay royalties to performers, in addition to songwriters. The bill has been hailed by musicians and opposed by broadcasters, who have long argued that by playing a song on air they give it valuable promotion.
But a side controversy has emerged over the MIC Coalition, a Washington advocacy group that includes Pandora, the National Association of Broadcasters and others that have frequently opposed the music industry over royalty matters. In June, Amazon withdrew its membership, and a senior executive told Billboard magazine that the company’s primary interest in transparency was “getting lost in the wilder noise surrounding rate-setting.”
Two weeks ago, National Public Radio also dropped out of the coalition after complaints from the Content Creators Coalition, which accused it of “working in Washington to deny fair pay to the very artists it purports to celebrate on their air.”
A spokeswoman for the MIC Coalition — whose name stands for Music, Innovation, Consumers — said that the group had not taken a position on the Fair Play act, though many of its members had as individuals. Michael Riksen, NPR’s vice president for policy and representation, declined to say why the organization left the MIC Coalition. But he said that he “viewed the coalition as a way for the voice and values of public radio and NPR to be part of a broad-based conversation about copyright reform.”
“Had it taken a position” on the bill, Mr. Riksen added, “we wouldn’t have joined in the first place.”
The political chances are also unclear for the Fair Play bill, whose other provisions include paying royalties to artists for recordings made before 1972, which are not covered by federal copyright. Similar efforts have failed in the past, and the National Association of Broadcasters says that 203 members of the House and 19 senators have signed a nonbinding resolution opposing it.
Still, Mr. Byrne and other musicians pushing for the bill say they are undeterred.
“This one can be won, then we can move on to the harder ones,” Mr. Byrne said. “Why this time? Can’t point to anything specific. It feels right, and as musicians that’s what often drives us.”