New Business Model = Same Demons

February 25, 2015

Alan Willaert  -  AFM Vice President from Canada

Citing the unfair split of revenues and lack of artistic control, today’s musicians shun the ubiquitous control of yore by the “majors,” and desperately attempt to validate their music by declaring themselves an “indie.” High quality home recordings, self-produced and marketed, are made possible by the technological advances in recent years, along with the promise of untold fortune by distribution through the World Wide Web. “Going viral” no longer means a trip to a physician, but a trip to the bank. Or does it?

There are artists who have become famous solely through exposure on YouTube, and bands from the past who have found new audiences by posting their back catalogue. Sites like this, and especially YouTube, are viewed as part of a new world order, a breakthrough for musicians seeking their 15 minutes, and most of all, universal rejection of the evil establishment. “We have a new business model,” they declare in unison. “We no longer have to sign with, or answer to, the ‘man’.”

Have we really found utopia in the music business? Well, no. In control of YouTube sits Google, now one of the world’s largest and most influential companies—of any kind. It probably wouldn’t surprise you to find out that they have revenue exceeding $450 billion, and fund more than 150 organizations. What is new, and extremely unsettling, is that Google has become the biggest corporate political donor in the US. Spending billions on marketing, paying lobbyists, and buying influence, it has politicians and regulators in a firm grip.

YouTube has been in the news before: charged with copyright infringement for allowing users to upload content without clearance from the rightsholder. Former Eagles member Don Henley and his Recording Artists’ Coalition (RAC) have taken particular exception to the flagrant and capricious style of appropriation by YouTube, and their seeming indifference to the law. Last year’s revelation that Google was pressuring independent labels to sign distribution deals for their artists, at a fraction of what was being offered to major labels’ artists, was the first indication of a steadily-growing dragon beginning to breathe fire on lesser beings.

As if we needed further proof that the schoolyard bully was in the building, along comes the Zoë Keating example. A gifted cellist with business skills more shrewd than most, Keating has stared into the dragon’s dead eyes. In a nutshell, Google demanded that she sign a contract with unbelievable terms and conditions for access to Google’s new Key Music service. Google threatened to restrict her access, remove revenue-generating ads from her YouTube videos, and use her music anyway, if she refused. Keating, unflustered by the monster, went public with their threats. While Google laughed her off in adamant denial, Keating fired back with a damning transcript of the conversation, apparently having taped it for her own protection. Oops, busted! Take that, ya big lizard!

There is much more to the story, and I would suggest you take the time to read it by clicking here.

So once again, absolute power has corrupted absolutely. And in unprecedented turnabout, the tiny and vulnerable web-based companies that 15 years ago needed protection from the major labels have exploded into huge multinationals that have the labels on their knees.

So, how’s that new business model working out? As the above-referenced story points out, the former “man” that young artists were quick to denigrate, is no match for the new “man.” With YouTube paying pennies in royalties, parent Google is determined to bring corporate greed and total control to a whole new level. Intuitive that public awareness will cause artists and labels to demand a fairer cut, Google is poised and already producing its own content.

Welcome to the “new world order.” It’s nothing more than a technological plantation, where the new “man” owns everything—the creators, artists, workers, content, distribution, marketing, and even the consumer. Look at the information your mobile device sends them. You are already part of the collective.

Is there hope? The best chance a musician has is exactly what I have reiterated previously. Do the copyright-related paperwork. Execute every bit of the paperwork, including filing AFM contracts on all your recorded content. These are the weapons you’ll need to fight the dragon.

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