What are they thinking….

I agree with Laurelin. It’s not right. The sad part is money from these lawsuits slips between the “legal” cracks. The contracts bands sign with labels require the label to pay the band for “the exploitation of the masters” – or in simpler terms, the record label has to pay the band a royalty when the music sells.
The lawsuits with Napster, MP3.com, Kazza etc are about copyright violations, not about unaccounted for music sales – in other words, the artist assigns rights to the labels. When these rights are violated, as the label controls the rights since the artists granted them to the label, its the label that can sue for copyright violation.
Settlements or payments for copyright violation do not require the label to pay the band a royalty as it falls under a different category than revenue from “selling” the music.
If a band does control their rights, and the band’s rights are violated by Grokster etc, the band can sue them directly, but now the band has to put up all the money for the legal costs etc.
In any event, no matter what the contact does / does not say, I do agree that the bands should be paid some of the settlement money.

Hi,
A while ago I wrote a post about online piracy in my own site, which I transcribe next:
”
So piracy is theft, no doubt about it, artists loose, labels loose, everyone looses and eventually, even those going for the freebies will loose for artists won’t be able to commit seriously to publish anything.
But there’s a big lie on all of this…
The lie being the true losses in this industry, which in reality are far inferior and I mean mega-far from the numbers publishing related companies want you, copyright agencies and the government to believe.
It’s easy to explain why.
Let’s say you have 10 dollars, and let’s say a CD costs 10 dollars.
These 10 dollars are all the money you have.
Now let’s say you buy the CD – congratulations, you’ve just fed the chain and artists can go on thinking the standard system will make them (last) rich.
But, for the sake of argument, let’s say you.. er… (for the sake of argument, *ahem*)… Let’s say you “copy” that CD from someone else and you pay a big ZERO for it.
Now, let’s do the math, how much did the industry lost?
Well, it lost 10 dollars. Correct.
Now let’s expand…
Let’s say you copy THREE CD’s for free, paying zilch, nada, nienti, a black hole… Now you have THREE copies and still have your ten dollars in the pocket. And now is where the real versus made up math comes in…
How much will the industry say it lost? You guessed it, they will say they lost “three” CD’s, hence, 30 dollars. BUT…
The truth, and the real truth is that they ONLY lost 10 dollars, this is the one and only REAL number, the REAL loss of the industry, because ten dollars is all you had to start with and you can’t “make up” money as the labels/publishing companies seem to be doing.
You now see, as everyone should, that the real loss was way inferior – believe it or not – in this case, 10 dollars. This is the truth, the real truth, the one that should be said and advertised, instead of making up fake and huge (and unreal) “loss” numbers based on just number of (free or cheap) copies around!
It’s simple to explain why labels and publishers are living a fantasy: If piracy was absolutely impossible, in the example above, you’d only be able to buy one and one only CD, and they would make only 10 dollars on that CD, the other two would never be sold to you, for you would not have enough money for them. The industry will never ever make the money they say they are loosing, because that money simply does not exist.
Technically speaking they are not loosing, what they are not is “winning” a possible but far inferior real value and blasting the rest with irrational liberty and user-rights threatening DRM and government lobbies that further irritate consumers and even some artists, it’s a down curve all the way to minus infinite with the only variable being time.
So, for all that matters, publishers may stick their fake “losses” numbers where the sun don’t ever shine and come up with either the real numbers – thus knowing what they can count with if piracy stops – or they can keep on dreaming with totally fake numbers and investing ridiculous sums in DRM and bigbrother like total control to get money that.. er… doesn’t exist… Ergo, this irrationality that is trying to get what does not exist will cause everyone to loose because, mathematically speaking, there really is nothing to be gained (not as huge anyway), physically speaking, you can’t make it up.
The industry is loosing, yes, it’s loosing it’s mind and throwing away it’s money on a witch hunt.
(Having said that, do buy my music if you can.)
”
Original post at:
http://www.alvaromrocha.com/en/2007/10/online-piracy-lie-beyond.html
Kind Regards,
AMR
http://www.alvaromrocha.com

The above articles were very good and informative. I would like to share some of my opinions about the above, ready, here goes. I have been wanting to rant about this for quite some time.
SO, the almighty RIAA is in fact, stiffin’ the artists they were suppost’ to protect. This does not surprise me. What REALLY is the RIAA? OR, WHO is the RIAA? Are they really the big 4 labels in disguise? You would be totally amazed at what the big 4 actually own. All those sub-labels of theirs total at least a couple hundred among themselves. (even some of the supposed “independant” ones). I will tell you that the big 4 have been “stiffin” “their” artists for years. It is my understanding that the 60′s group the “Byrds” were NEVER paid for the recordings “Tamborine Man” and “Turn Turn Turn”, major hits. Where did the Byrds money go???? Ask one of the so-called “Big Four”, or their successor entities. (since so many “former” labels have been bought up and absorbed over the last 10 years or so.
In addition, so Amy Winehouse, (bless her soul), has now been proclaimed the “new Billie Holiday” by the heralds of the big four. I would like to conjure up Billie’s spirit and ask her what she thinks of that moniker. Would she be indignant, or would she feel sorry for Ms. Winehouse? Did you know that the vaunted Atlantic Records “stiffed” Ms. Holiday out of her money too!!! Don’t believe me, check it out for yourself, do some research like I did. I got this info. from a library book in my local city. Billie Holiday was broke and almost destitute when she deceided to file a suit against that label and it took a face to face talk with Amet Ertegun himself to reach a settlement. I do not know what the settlement was or how much. But Ertegun played up on Billie’s sediments about him from the “good ol’ days” to put an end to the controversy. This is what I read.
In conclusion, I would like one last hit at the RIAA. So they sued 20,000 “infringers”. Let me tell you who they sued. They sued the parents of 12 year old kids who didn’t have the money to buy those expensive CD’s. You know what I’m talkin’ bout. Those CD’s that have 1 or 2 good songs on them and 9 other stinkers. Those file sharing services were a good concept, just get the particular tune you want, pass on the stinkers. The concept should have been more thought out however. I believe in copyrights. Those artists have a right to their intellectual property.

I would like to make a correction to the article I posted a little while ago. Billie Holiday was signed with Decca records. Not Atlantic. Since Ahmet Ertegun was the boss at Atlantic, not Decca it would not seem feasible that Holiday would have to talk with Ertegun about her money, but once again, that’s what the book said. So I applogise for any hurt feelings about this. But I stand by my statements about everything else.

This is such a good discussion about current industry trends, concerns and outright confusing perspectives.
I would have to say that Enjay has nearly hit it on the head with the concerns over piracy, loss, etc.
One little tidbit that most people don’t realize is that when a company, in this case a label, owns physical copies of a product, that product is depreciable over the anticipated life of the product. This means that an album only has a shelf life of 5 years and for 5 years a label can write off the investment that they made. This helps them to offset their total profits annually.
The problem with digital media AND piracy is that there is no physical product to depreciate. You can’t write off what you don’t physically have. Needless to say, this threatens the tax status of labels.
Intellectual rights are a slippery slope and can’t really be written off either. So, when you’re a label, all of this uncontrollable digital media demand that is zipping and zinging along faster than you can keep up with becomes more of a threat to your long term viability than it is a benefit.
Of course they’re going to buck this development as hard as they can, and for as long as they can. Likely until they can get legislation and tax laws altered in their favor.
But… that’s just my 2 cents.
Kelly