Agreement Reached on Webcasting Royalty Rates

Ladies and Gentlemen, we have an agreement.

News broke today that "pure play" webcasting services (i.e., the bigger online broadcasters who earn the bulk of their revenue through their services) have reached an agreement with SoundExchange — the nonprofit organization that collects and distributes the digital public performance royalty on behalf of performing artists and sound copyright owners (usually the labels).

Back in 2007, the Copyright Royalty Board — a smallish group of judges tasked with rate setting for online broadcasts — ruled that all webcasters were required to pay a single fee. This per-song royalty would increase to 0.19 cents per song in 2010. Webcasters responded vigorously, claiming that the fees would, in many cases, exceed their entire revenue. FMC also weighed in in the form of Congressional testimony, saying that a one-size-fits all approach to webcasting rates would have a negative impact on a crucial emerging marketplace for independent and niche music.

Since then, rate accommodations have been reached for noncommercial broadcasters' online streams — in January, the Corporation for Public Broadcasting paid $1.85 million for the right to digitally broadcast through 2010. Meanwhile, commercial terrestrial radio agreed to pay 0.15 cent per song for online "simulcasts" of their over-the-air programming, with rates set to increase each year up to 0.25 cent in 2015.

Yet, despite Congressional Acts meant to clear room for negotiation and the implementation of an agreement, there was no consensus between SoundExchange and the bigger webcasters. That is, until now.

This new agreement settles a long-held dispute between the bigger webcasters like Pandora and AOL Radio about how much they should pay. Today's agreement will see those webcasters paying the greater of 25 percent of revenue or a per-song fee which, starts at .08 cent (retroactive to 2006) and eventually scales up to to .14 cent in 2015.

Also of note: companies that offer services beyond streaming radio, such as on-demand subscription and download sites like Rhapsody (who also do streaming), will be eligible for the same rates accepted earlier this year by the National Association of Broadcasters for their simulcasts.

The reaction from all parties involved in negotiations has been generally enthusiastic. “This is definitely the agreement that we’ve been waiting for,” Pandora founder Tim Westergren told the New York Times.

In official statement, John Simson of SoundExchange said the agreement would give webcasters "the opportunity to flesh out various business models and the creators of music the opportunity to share in the success their recordings generate.”

Yet it remains to be seen whether the smaller webcasters will sign on. Billboard has more:

First there's the cap on songs streamed, which for 2009 is based on aggregate tuning hours of 8 million. That's up from the 5 million listed in an earlier offer that small webcasters largely rejected, and increases to 9 million in 2011, and to 10 million for the 2012-2014 timeframe. Retroactively, the cap is 7 million for the 2006 - 2008 timeframe.

Also scuttling the earlier small webcaster settlement offer was a provision for payments should a small webcaster be acquired by a larger company. In the current offer, the acquiring company would have to pay the difference in royalties for up to four years retroactively if after the acquisition the new company makes more than $1.25 million a year, or 30% of the transaction value.

We at FMC take it as a positive sign that the parties involved have an upbeat view of the settlement. Plus we're pretty psyched that we can still listen to Pandora at work and know that artists are being compensated!

This Week In News

ReverbNation Survey: How is the Economic Downturn Affecting Artists?
ReverbNation conducted a survey of artists in an attempt to learn how the downturn was affecting their everyday lives across a variety of factors. There was a general perception among respondents that the economic downturn was affecting them in a negative way, overall. Specifically, artists cited that they were touring less, receiving less money for gigs that have become harder to get, taking fewer lessons and turning to more DIY ways of recording their music. Hypebot.com

Pandora Changes Artist Airplay Submissions
Until recently, Pandora accepted music from indie artists at no cost in almost any form including home burned CD-R's.... Hypebot.com

Michael Jackson Breaks Billboard Charts Records
As predicted, Michael Jackson is once again the King of the Pop charts. Based on preliminary sales numbers from Nielsen SoundScan, the entire top nine positions on Billboard's Top Pop Catalog Albums chart will house Jackson-related titles when the tally is released in the early morning on Wednesday, July 1. Nielsen SoundScan's sales tracking week ended at the close of business on Sunday (June 28) night. Keith Caulfield, Billboard.Biz

Free My Phone
New mobile phones have been called “the Internet in your pocket,” but they’re not. Through exclusive deals for phones like the iPhone and BlackBerry Storm, wireless companies have curtailed innovation, crippled applications, and stuck users with the bill. Free Press

Will File Sharing Case Spawn a Copyright Reform Movement?
Last Thursday’s $1.92 million file-sharing verdict against a Minnesota mother of four could provide copyright refor advocates with a powerful human symbol of the draconian penalties written into the nearly-35 year old Copyright Act. Then again, maybe notDavid Kravets, Wired.com

Study: Twitter Users More Likely to Buy Music
Record labels looking for customers should focus their efforts on the Twitter faithful, according to new data from NPD Group. About 33 percent of Twitter users have purchased a physical CD and 34 percent have bought a digital download in the last three months, the report said. AppScout.com

Spotify Doubles Streaming Quality
Spotify, the Swedish internet radio station that allows users to stream tracks over the internet, is improving sound quality for 'Premium' users. Spotify is free to use, although listeners will find tracks peppered with adverts, just like commercial radio. However, for a £9.99 monthly subscription, users can enjoy ad-free listening. Carrie-ann Skinner, NetworkWorld.com

Local Independent Promoter Sues Live Nation

A recent development in the Live Nation antitrust saga hits close to home for those living here in the District of Columbia (that’s Washington, folks). I.M.P. Inc., an independent DC/Maryland concert promotion and event production company, recently filed an antitrust suit against Live Nation. Owned by Seth Hurwitz and Rich Heinecke, I.M.P. Inc., operates the famous 9:30 Club in Washington, DC and Merriweather Post Pavilion in Columbia, Maryland.

I.M.P. claims that Live Nation has unlawfully acquired a monopoly over the national market for live music. They assert that over the years, Live Nation has acquired practically exclusive control of national concert promotions and venue services, and is now threatening to extend their control to ticketing, concert merchandising and artist management. These latter allegations seem to reference the proposed Live Nation/Ticketmaster merger currently being reviewed by the Department of Justice for possible antitrust concerns. (FMC recently asked those on both sides of the merger to give us their opinions; you can read the results here.)

According to I.M.P., Live Nation threatens to “knock Merriweather out of business or force the owners of Merriweather to engage Live Nation to manage this venue.” I.M.P. is suing for treble damages — a legal trick that would allow the court to award three times as much in damages in order to punish the Live Nation for willfully violating the law.

This suit is not Live Nation’s first brush with antitrust allegations. In 2001, Denver independent concert promoters Nobody In Particular Presents (NIPP) filed suit against radio conglomerate Clear Channel (which at that time owned Live Nation), claiming Clear Channel illegally reduced the airplay of artists that NIPP booked for their concerts. NIPP and Clear Channel settled in 2004. Now the company is back in the legal spotlight due to the proposed merger with Ticketmaster.

What do you think about the proposed Live Nation/Ticketmaster merger? Feel free to let us know in the comments.

Podcast Interview with Entertainment Attorney Josh Wattles on FMC's Artist Principles

Back in April, FMC released the "Principles for Musician Compensation in New Business Models” (or “Artist Principles”) — a set of guidelines for ensuring creator compensation in an evolving music landscape. Crafted by artist advocate Ann Chaitovitz with input from over a dozen industry experts, the Principles represent a first step in ongoing discussions about musicians’ revenue streams. You can read the document (and a handy point-by-point translation) here.

One of the main reasons for drafting this item was to get a conversation going with some of the smart people in the music world about what they think are the most important issues facing artists in the digital age. While we don’t expect these principles to be embraced by everyone, we do want to makes sure those with something to add to the discussion had a forum in which to do so.

This installment is an interview with Los Angeles-based attorney Josh Wattles, whose years in the copyright and entertainment fields have awarded him with an insider's perspective (and no shortage of opinions). Wattles talks to FMC about what he would envision in a pro-artist document, and makes some provocative statements about what the role of a record label should be in today's music marketplace.

Check out the MP3 of our conversation, and stay tuned for more podcasts in this series.

Chart Attack: Who’s “Indie” When it Comes to Sales?

Digital Music News recently ran an article called “The Gray Art of Counting Indie Sales,” which underlined the confusion of tallying purchases of downloads or CDs based on the music’s “independent” classification. According to the American Association of Independent Music (A2IM), 32 percent of album sales in 2008 came from independent artists, but Nielsen Soundscan puts that number at 12.8 percent. Part of the difficulty in differentiating between an indie and a major the fact that many indie labels enter deals with distribution companies owned by the majors, such as ADA (95% owned by Warner) or Fontana (owned by Universal). As a result, major labels have a tendency “count the sales of their distributed partners, while indies like to downplay those partnerships,” according to DMN publisher Paul Resnikoff.

According to the American Association of Independent Music (A2IM), everything is tallied according to IP ownership — in other words, who owns the masters. "What makes a label an “indie'” is that its master recordings are not owned by one of the major labels," the group stated.

A2IM president Rich Bengloff tipped Digital Music News to that distinction earlier this year. "I think if you asked the man on the street they would go with the ownership criteria because it's permanent," Bengloff said.

FMC has had its own experience with trying to figure out what constitutes an indie or a major label. Over the last year, FMC has conducted research on radio playlists, released last month in the report “Same Old Song.” Since the research was designed to measure the difference in “airplay share” for songs released by major labels versus non-major labels, the backbone of the work was coding all of the labels that received any airplay between 2005 and 2008. When we extracted that list, there were over 6,000 unique record labels that received some airplay.

We ended up having 5 different codes:

• Major: the four majors and any of their many-owned subsidiaries and imprints

• Indie: Following A2IM’s lead, we considered an indie label as one independently owned/that controls its own masters and seems to be responsible for its own radio promotion. Even if the indie label had a distribution deal, we classified them as “indies” since distro deals usually focus on getting songs into retail as opposed to getting airplay on radio.

• Disney: including its imprints Lyric Street, Fearless and Hollywood Records. After completing some early data analysis we discovered it was important to give Disney its own code since, in some formats, this one label or its subsidiaries was garnering 2-3% of total airplay. In essence, Disney has the strength of a major label, but was not part of the payola proceedings and thus needed its own category to isolate its level of influence.

• Legacy: A small set of labels or well-known artists for which their relationships to the major labels has either changed over time, or for which a major label association with radio is likely, but cannot be confirmed. Example: recent releases by The Eagles, Jimmy Buffett, Cheap Trick or Motley Crue: artists who are now putting out their own music, but who have a well-documented history of significant radio airplay while on a major label in the past. There are also some current labels in this pool, such as Tooth and Nail, that started as an indie in the 1990s, but has allegedly created a number of upstreaming deals with major labels. This is also where we put companies like Mountain Dew’s Green Label Sound, which has been releasing singles to promote the soft drink. Clearly, this is a company with a significant promotional budget, but it’s not a major label. Without additional information it was difficult to categorize them as an indie or a major.

• No label/TBD: in the cases where there was insufficient data

Even with these five categories, we had to make many judgment calls. There were cases where a label’s relationship to various major labels had changed over the years. For example, Roadrunner started as an independent but as of January 2007 is now 74 percent owned by Warner Brothers. There are other labels that have a documented upstreaming deal with the majors – such as Fall Out Boy’s label Decaydance, which has a relationship with Island – where the independent label finds a band, puts out their first record and then the major label partner can come in and sign them to a bigger deal. On the charts, if the song had a listing Decayadance, we’d code it as an indie. If it said Decaydance/Island, we classified it as a major. In cases where we could not determine with certainty, we erred on the side of independence. Needless to say, defining “indie market share” is an inexact science, and an ever-evolving landscape.

But what about unaffiliated artists who aren’t on a label – indie or otherwise? We’ve talked recently about services like TuneCore, CD Baby and ReverbNation, which, for a nominal fee, get unsigned artists “stocked” at digital retailers like iTunes, eMusic, Amazon MP3, Rhapsody, Napster and so forth. If an unaffiliated act starts “moving serious units,” to use Music Industry 1.0 lingo, how do they demonstrate this success to the wider world? For this, you probably need some kind of ranking system that the industry (and fans) perceive as legitimate.

TuneCore currently has a chart in Billboard showcasing the 25 top-selling artists who use their service. (This chart displays two types of data: top selling full albums by total earnings for the period and top selling individual songs by earnings for the period.) Appearing in Billboard would do more than make your mom proud — it actually means something to the industry. But since established mainstream artists also use TuneCore, the top spots are often already filled. For instance, Jay Z, David Byrne, Joan Jett and t.A.T.u are all currently featured on TuneCore’s March 2009 album list (as reported in May 2009). That’s some stiff competition. (Click here for a look at the most recent charts.)

Digital distributor/marketing tool ReverbNation also has charts to show which of its artists are selling the most. But unlike TuneCore’s Billboard chart, which lumps all musicians irrespective of genre into a single top 25 listing, ReverbNation breaks its lists down by not only style of music, but also by location. You can find the top selling albums/songs from musicians from US or even the world,, including your own backyard. (Similarly, TuneCore’s iPhone app uses a geolocator that tells you the 25 best selling TuneCore songs based on your exact zip code.)

Keep in mind that all of this is based on downloads. While digital sales might currently be a better indicator of “success” than MySpace plays, there isn’t (to our knowledge) a chart that measures on-demand listens where you don’t keep the digital file. As people grow more accustomed to “accessing” music as opposed to owning it, accounting for online plays could become increasingly important.

As more artists go direct to fans and label roles evolve, all of this gets a bit fuzzier. Will everyone eventually be wading in the same digital pool? Do standard chart measurements even apply in a world of limited-edition physical items, on-demand streams and (potentially) legal filesharing?

For a lot of musicians, having people at your shows and moving some merch is achievement enough. But we’re curious: what do you think counts as success with recorded music? Feel free to let us know in the comments.

This Week In News

Sony Agrees to Provide Its Older Songs to eMusic
In another example of struggling major music labels and Internet services finding common ground, Sony Music Entertainment has agreed to make its back catalog of songs available on eMusic, one of the largest music retailers on the Web. Brad Stone, The New York Times

Live Nation to Rollout ‘No Service Fee’ Promotion
Live Nation will eliminate service fees on more than five million lawn tickets and hundreds of concerts for its amphitheaters in a one-day promotion June 3. The 24-hour sales event is being billed as the biggest ticket promotion ever, which would be hard to dispute. "No Service Fee Wednesdays," begins June 3 at 12:01 a.m., offering fans some of the lowest prices of the summer with no ticket service fees on any LiveNation.com-ticketed amphitheater show, and only at LiveNation.com. Ray Waddell, Billboard.Biz

Web Radio Hits the Road
It took a long drive over a holiday weekend -- a setting that should have played to all of radio's traditional strengths-- to show how much trouble commercial FM stations may have in store. The soundtrack for the trip along Interstates 66 and 81 to the Shenandoah Valley town of Woodstock, Va., came not from FM, an XM or Sirius satellite broadcast or such recorded alternatives as CD or iPod. Instead, our musical selection came from an Internet-connected smartphone that streamed Web radio to the nearest speakers through a cheap tape-deck adapter. Rob Pegoraro, The Washington Post

Walmart Shutting Down DRM Download Servers
Walmart.com's music download store went DRM free in February of 2008; and now the retail giant is telling customers that they'll no longer support the DRM laden downloads that they sold them prior to the transition. Hypebot.com

This Just In: Old People Hate New Music
… E Street Band guitarist “Little” Steven Van Zandt is citing the sucktitude of today’s rock ‘n’ roll as the reason the record industry is sinking faster than the Lusitania (“Who are we kidding here? Nobody’s buying records? Because they suck!”). Modern rock’s suckiness, the apparently computer-illiterate Van Zandt claims, can be traced to the fact that this generation’s musicians are eschewing the time-honored tradition of playing cover songs in bars (so’s they can focus on original material, the bastards!) and ignoring the importance of ripping off the popular rockers who came before them. James Greene Jr, Crawdaddy.wolfgangsvault.com

Billboard.biz Q&A: Former RIAA CEO Rosen Talks Napster
When Napster first went live 10 years ago this month, the music industry didn't immediately notice. It wasn't until around September 1999 that the RIAA got wise, and not until December that a lawsuit was filed. Leading the organization at that time was Hilary Rosen, who presided over the case that shut down Napster and all the music industry moves that followed until she resigned in 2003. Anthony Bruno, Billboard.biz

Is "Cloud" Music Becoming a Reality?

Digital Music News ran a short item today about Spotify — a fast-growing free/subscription streaming service that's available overseas but not yet in the US. The article is about a demo of an upcoming app for Google's Android cellphone platform:

An Android mobile app was splashed at the Google I/O conference in San Francisco, a work-in-progress that quickly excited music fans and bloggers alike. As one would expect, the app demo featured on-demand access to a catalog of millions, using available WiFi. But users will also be able to access tracks while disconnected, a feature that eliminates a huge connectivity hurdle.

There's also a YouTube clip of a similar Spotify app for iPhone, which, to the best of our knowledge, has yet to be approved by Apple. If anything could compete with iTunes, it's Spotify, so it will be interesting to see if an iPhone app does indeed roll out with a Spotify US launch (rumored to happen later this year).

Although it's not officially available in the US, Spotify is starting to win converts among American music reporters and pundits. Wired's Eliot Van Buskirk says the service is “like a magical version of iTunes in which you’ve already bought every song in the world," and industry observer Bob Lefsetz has been moved to praise Spotify IN ALL CAPS on more than one occasion.

There are probably several reasons for Spotify's rapid adoption in countries like the UK, where it's been available for a year or so. The graphic interface is straightforward (and very iTunes-like), and, since it employs a robust desktop client, there is practically zero lag (yes, we've tested this.) Spotify also uses the superior Ogg Vorbis format for its streams, which means it actually sounds good. Perhaps most attractive is the fact that the service is free — as long as you don’t mind hearing a solitary audio ad every half-hour or so (there's also a paid version without the ads). This means that artists and sound copyright owners are compensated, which we think is top priority for any new digital music doohickey.

Keep in mind that Spotify is on-demand listening, not "predictive radio" like Pandora (which is also gaining popularity, largely due to mobile applications).

Music-tech analyst Andrew Dubber gives a useful overview of Spotify, which you can read here. Among his favorite features:

. . .every artist, every album and every track has a unique URL that can be sent via email, Twitter, IM, Facebook or any other kind of messaging system - and if the recipient also has Spotify installed, that music will play in exactly the same way it did for the person sending it.

Recently, Andrew made a recommendation via his Twitter feed; if you're a Spotify user, you could click the link and the album he was talking about immediately pops up and starts playing on your end. With the ubiquity of social media, it’s easy to imagine this becoming a powerful, cost-effective and legal way to share music.

Some have complained that Spotify, while rock-solid performance-wise, is lacking some essential features. On the other hand, the Spotify folks have opened their service to outside development, which likely means enhancements are forthcoming. Essentially, approved third-party devices and services would be able to use Spotify’s engine and catalog, which could be particularly fruitful in the mobile space.

There are also concerns that subscription and ad-based models don't pay artists and labels as much per play as downloads of physical sales. But that could change, especially if more people get hooked on listening this way. It could also help curb piracy — why take the chance on viruses and music in crappy bitrates, when you can get better quality tunes for "free" (or at a nominal cost)?

The idea of being able to listen to practically everything you'd ever want to whenever you want to isn't new. But American consumers haven't fully embraced such services, even with Rhapsody, Napster, etc. offering some version of subscription-based access. Will Spotify be the model that makes "the cloud" click? Only time will tell. . .

TuneCore Scores Spot at Amazon

TuneCore is one of a handful of companies (including CD Baby and ReverbNation) offering digital (and in some instances physical) distribution for the DIY musician. For a relatively small fee, artists using these services can get their tunes in all the major digital music sellers (iTunes, eMusic, Rhapody, etc.) — which means a coffeehouse strummer can be in the same "store" as Beyoncé. Pretty cool, huh? CD Baby will also handle the warehousing and mailorder for your physical discs, and most of these services provide referrals for custom-batch CD manufacturing.

Today, Digital Music News is reporting that TuneCore has made a deal with Amazon to have a special section within Amazon's MP3 store:

The TuneCore-branded environment will live within the broader AmazonMP3 site. Additionally, artists can offer custom-crafted CDs through Amazon partner CreateSpace. The action starts June 1st.

TuneCore already direct-ports downloads into a number of stores, including Amazon, iTunes, among many others. The store-within-a-store builds upon an existing partnership between TuneCore and Amazon, as does the CD-pressing component. The expansion helps TuneCore to expand its value proposition, though it also allows Amazon to breathe some life into its CreateSpace acquisition.

You may be familiar with CreateSpace, which grabs DIY by the long tail (ha!) and lets users self-publish books, music and movies to be stocked and sold through Amazon. We think it's great that more artists are able to use new services to get their creations out there, but if these services continue to take off, there will be that much more stuff to sift through. The question then becomes, what mechanisms can effectively facilitate discovery? Or to put it more simply, how do fans find what they like? Do they just randomly stumble upon it? Does the burden of marketing and promotion rest solely on the creator? How can developing artists most effectively cut through the noise?

In the past, labels handled much of an artist's promotion (PR firms also assist), but the game is changing for any number of reasons — the erosion of the physical CD market, unauthorized filesharing and the uncertainty around new models (like ad-supported and subscription services) — to name a few. For now, this could mean fewer acts get signed to traditional labels, and less money is available for promotion. It could also mean a future where industry entities become "all-in-one" services that provide a combination of marketing and promotion, live booking and tour management, recording and distribution and possibly even rights administration. The so-called "360 degree" deals that are popular with some superstar artists could represent a step in this direction.

But what about all the other artists out there? How will they cultivate and retain audiences? It's one thing to be able to make your stuff available, it's another to get the right people to find it. Magazines and radio have always acted as a kind of filter, but restrictive commercial radio playlists and the financial struggles of print (and online) media combined with the ever-increasing amount of music makes it tough for most artists to attract listeners. Obviously, reaching audiences was a challenge even back when the business of music was dominated by a system of bottlenecks and powerful gatekeepers. But there are new hurdles now that creative content is seemingly ubiquitous.

We're curious to hear your thoughts about the future of DIY and marketing in the digital age — feel free to leave a comment below. . .

Green Day Bites Back at Wal-Mart

With physical CD sales dwindling, you don't hear as much about how certain records aren't carried by particular retailers due to so-called "objectionable content." But it still happens. Case-in-point: the new album from pop-punk lifers Green Day, whose latest disc, 21st Century Breakdown, cannot be found at Wal-Mart.

Remember, before being overtaken by Apple's iTunes, the brick-and-mortar megastore was the country's largest seller of recorded music. Yet with floor space dedicated to CDs shrinking and online outlets (legal and otherwise) proliferating, does it even matter that the Number One album in America can't be purchased alongside a six-pack of Brawndo and a hunting rifle? Green Day frontman Billie Joe Armstrong thinks so: "Wal-Mart's become the biggest retail outlet in the country, but they won't carry our record because they wanted us to censor it," he said in a recent interview.

Read more in this Comcast.net feature (Comcast actually has a promotion going with Green Day via its On-Demand service — talk about a clash of the corporate titans).

Wal-Mart carries a "clean" version of Eminem's grisly latest, but Armstrong claims "there's nothing dirty about our record." Is this censorship? Tell us what you think in the comments.

This Week In News

Spotify CEO Talks Portability, Premium Service Growth
Daniel Ek, founder and CEO of music streaming service Spotify, says he wants to build on the early popularity of the ad-supported free model by developing a portable service and attracting users to the premium service. Jen Wilson, Billboard.biz

Analysis: The Orchard Keeps Focus On Long-Term
The latest earnings results from digital distributor the Orchard painted a picture of a company with a focused long-term strategy for an increasingly competitive marketplace. Glenn Peoples, Billboard.biz

The Future of Mobile Music: Will Labels Participate
Phones are frequently viewed as walled-garden alternatives, safe places for controlled media sales. But as phones evolve into handheld supercomputers, is the sordid history of the traditional web doomed to repeat itself? DigitalMusicNews.com

Strapped For Cash, Music Fans Let Go Of CDs
California's Amoeba Records is the largest used-music retailer in the world. The checkout lines often wind deep into the clearance aisles. But not lately. These days, the real action comes from people selling their collections — and using the store as an emergency ATM. April Dembosky, NPR.org

April Album Sales Down 'Only' 9%
U.S album sales were down 9.2% in April 2009 versus April 2008 according to data at Neilson SoundScan. The deficit is a big improvement over the 17.9% deficit in March and the 11.5% deficit in February. Billboard.biz

Pandora: iPhone Driving Revenue Increases
Is the iPhone inadvertently aiding Internet radio? While Pandora’s main source of revenue is in advertising deals, a growing portion of the company’s revenue comes from affiliate downloads that drive sales in the iTunes Store or on Amazon MP3…and the primary mover in that regard these days is the iPhone. AppScout.com

Best Buy Has Plans to Sell Vinyl Records in Stores
Next time you go to your local Best Buy store you may see vinyl records as part of the product mix. While Best Buy does sell vinyl records online, the retailer thinks it may be time to expand accessibility to its vinyl record offerings by devoting space within their physical stores. Robert Silva, About.com

Think Local, Think Indie at New Digital Music Shop
If you’re hoping to survive in the age of file sharing, it pays to be aggressive if you’re a Mom and Pop record shop. So the nationwide Coalition of Independent Record Stores just swallowed its pride and launched a digital music store: Thinkindie.com. Michael Deeds, IdahoStatesMan.com

How The iPod Changed Everything
While pirates bled the music industry, other businesses rode the tide and collected the booty. Former Apple insiders tell Matt Hartley how Steve Jobs did it. The Globe and Mail.com

mSpot Seals More Deals: CBS Radio, Last.fm Latest
Mobile entertainment company mSpot has now sealed deals with both CBS Radio and Last.fm, according to details shared with Digital Music News over the weekend. Both properties are owned by CBS Corp., and are now being integrated more aggressively. DigitalMusicNews.com

Twitter Me This

With even members of Congress “tweeting,” it was probably inevitable that the ubiquitous status-updating service Twitter would start being used for things that were just a glimmer in some developer’s eye even a few short few months ago. Besides hipping your “followers” to what you had for breakfast, users are also playing DJ – building playlists on other digital services and “sharing” tunes with the greater Twitterverse.

Wired’s Epicenter blog recently examined some of the most popular Twitter-meets-music applications like blip.fm, twisten.com and song.ly. With most of these music apps, you simply search for a song, it kicks out a shortened URL link to that song that’s being hosted somewhere on the internet and — tweet! — when your followers click on the link, they can hear the song, too. But this article got us thinking: are musicians being compensated for these plays and, if so, how?

Our crack, two-person research department got to work. We dug through various services, using Simple Machines catalog and The Contrarian releases as test balloons. We checked in with a digital music service provider and a content licensor. As far as we can tell, this is what’s going on:

There is no license for this use. . . yet. That’s no surprise, given that the concept of tweeting music is less than 10 months old, and it sometimes takes years for the Copyright Office and other licensing agencies to recognize a use (and even longer for the copyright law to be codified around a new use). Yet this novel use raises some fundamental questions: are these tweets essentially a micro-broadcast that would qualify as a “public performance” and subsequently mean that licenses from ASCAP/BMI/SESAC would be required? If yes, then who is responsible for acquiring and paying for the license? Or does the interactive nature of the tweet mean it should be considered an interactive stream? If it is an interactive stream, that means direct negotiations with labels and publishers would be necessary to acquire permissions and set a rate. But with the music spread across the web — legally or otherwise — and the services themselves acting as “search,” which party would be responsible for getting a license?

Music is being hosted all over the internet. This would be a lot easier if the music was being pulled from a source that already had the licenses in place, something like a Rhapsody or Napster. However, our tests show (and sites’ FAQs indicate) that the songs that pop up in their search boxes – and are subsequently tweeted – are being hosted by random servers all over the internet.

In some cases, musicians may have pre-consented for a use like this. Many times a band or label will identify a couple of songs on each album that are pre-cleared for promotional use, such as made available for a free stream on MySpace, or embedded in a podcast, or posted to an MP3 blog. While it’s possible that the twitter-based search engines are finding this pre-cleared material, which sits on servers all over the place, it’s also highly likely that lots of the songs have not been pre-cleared. In some cases the music may be partially licensed, but even this brings up questions about how revenue is generated – is the site ad-supported, subscription-based, or part of an equity agreement between the rightsholders and the service? What happens when the song becomes a link in Twitter?

Because there is no license, there is no direct revenue for these performances. Without a license in place, all the music being tweeted and re-tweeted are essentially full-length plays for free. There is likely some revenue generated through “Buy MP3” referrals embedded in blip.fm tweets, but the performances themselves are currently unlicensed.

We’re not trying to sound like grumpy old schoolmarms — actually, we get very exited when we see new applications that facilitate the discovery of new music. Still, it’s FMC’s duty to examine new music models to understand whether and how they compensate musicians. Given how quickly music fans have embraced Twitter as a way to hear, share and discover new sounds, those in the music and technology communities should ask a few questions, namely: are these uses sustainable? If so, should they be licensed? Could existing music destinations become the legit backend for socially driven discovery?

Perhaps it is too early to tell whether Twitter + music will flourish, or if it will only last as long as Twitter’s venture capital funding. We’re guessing Twitter is here to stay, which means that folks in both the music and tech worlds will eventually need to work together to ensure the platform’s growth, and to address whether and how musicians are compensated when their music is fleetingly tweeted.

Any Twitter DJ’s out there? What do you think?

Podcast Interview with Billboard's Glenn Peoples on FMC's Artist Principles

A few weeks ago (April 2, 2009, to be exact), FMC released the Principles for Musician Compensation in New Business Models” (or “Artist Principles”) — a set of guidelines for ensuring creator compensation in an evolving music landscape. Crafted by artist advocate Ann Chaitovitz with input from over a dozen industry experts, the Principles represent an important first step in ongoing discussions about musicians’ revenue streams. You can read the document (and a handy point-by-point translation) here.

One of the main reasons for drafting this item was to get a conversation going with some of the smart people in the music world about what they think are the most important issues facing artists in the digital age. While we don’t expect these principles to be embraced by everyone, we do want to makes sure those with something to add to the discussion had a forum in which to do so.

Hence our new series of podcast conversations with leading music industry minds about the Artist Principles. The first edition features Billboard Magazine’s Senior Editorial Analyst Glenn Peoples. Glenn recently finished a five-and-a-half year run at the highly respected music industry blog Coolfer, which he founded. Now, his whip-smart industry observations can be read daily at Billboard.biz, in addition to longer features in the print version.

Glenn recently wrote an article about FMC’s Artist Principles, which you can read here. Glenn’s piece praised the principles — which put forth some broad guidelines about how artists should get paid in an evolving digital music landscape — for their call to greater transparency in accounting for revenue generated by new services. Yet he had some problems with a few of the points, especially those having to do with the relationship between artists and labels.

We asked Glenn to spend a few minutes with us to further explain how he views these complex issues at in a tricky time for the music business. Click here to listen to an MP3 of our brief chat, and stay tuned for more on this subject. . .

FMC Releases "Same Old Song" Playlist Analysis Report

Have you ever been scanning through the music rags at your local bookstore/music retailer/coffee emporium/tchotchke outlet and wondered, “why do I never hear this band that’s on the cover of all of these magazines on my local radio station?”

We’ve scratched our heads about this, too.

There are quite a few independent acts out there that are successful by pretty much any other measure — they sell out venues, play Saturday Night Live, can be heard on movie soundtracks, TV shows and commercials yet never seem to crack commercial radio playlists. After a while you start wondering if there’s a reason. Turns out there is – it’s just sort of complicated.

But don’t worry — FMC lives to sort this stuff out. To that end, we’ve just released a major new study of what gets spun on radio called “Same Old Song: An Analysis of Radio Playlists in a Post FCC-Consent Decree World.” Before we get into the results of this data-driven report, let’s look at some of the history. (If you wanna dive in, click here).

“Same Old Song” analyzes radio playlists from 2005-2008 to determine whether the policy interventions resulting from the recent payola investigations have had any effect on the amount of independent music played on terrestrial radio. Back in 2007, Federal Communications Commission issued consent decrees against the nation’s four largest radio station group owners – Clear Channel, CBS Radio, Citadel and Entercom – as a response to collected evidence and widespread allegations about payola influencing what gets played on the radio. In addition to paying fines totaling $12.5 million, the station group owners also worked with the American Association of Independent Music (A2IM) to draft eight “Rules of Engagement” and an “indie set-aside,” in which these four group owners voluntarily agreed to collectively air 4,200 hours of local, regional and unsigned artists, and artists affiliated with independent labels.

Using playlist data licensed from Mediaguide, FMC examined four years of airplay – 2005-2008 – from national playlists and from seven specific music formats: AC, Urban AC, Active Rock, Country, CHR Pop, Triple A Commercial and Triple A Noncommercial. FMC calculated the “airplay share” for five different categories of record labels to determine whether the ratio of major label to non-major label airplay has changed over the past four years.

Guess what? The number crunching indicates almost no change in station playlist composition the four years we examined. Specifically, the national playlist data showed little measurable change in airplay share from 2005-2008, with major label songs consistently securing 78 to 82 percent of airplay. There was a slight increase in airplay for indies on a few formats (Country and AAA Non-Commercial, in particular) but otherwise the data from year to year stayed pretty much the same.

But we didn’t just look at these big meta trends — we dug in and also examined airplay by release date. This showed that many formats leave only small portions of their playlist for new material, with current songs sprinkled in among well-worn hits. While such programming choices might make sense for a given station’s target audience, the outcome is that there are very few spaces left on most airplay charts for new music. Looking specifically at airplay for new releases, we found that new major label songs typically receive a higher proportion of spins than new indie label songs. Finally, we looked at the indie labels themselves, and found that only a handful have enough resources and clout to garner airplay consistently. For the remainder of indies, airplay is infrequent and modest, if it happens at all.

The fact that indies are still having a tough time getting airplay is something a recent survey of A2IM independent label members indicated in a more anecdotal way. The major labels’ built-in advantage, combined with radio’s risk-averse programming practices, means there are very few spaces left on any playlist for independent labels, which comprise some 30 percent of the domestic music market. Remember, this is after well-intentioned (if nonspecific) attempts to address this imbalance.

So what’s the take-away? How might the situation between radio and indies be improved? Our new report offers a handful of policy recommendations that might prove useful to the FCC’s oversight of the airwaves and improve the radio landscape for both listeners and the broader music industry. In particular:

1. Improve Data Collection

The radio and music industries participate in and employ some of the most robust and timely data monitoring systems available. There are private companies that measure audiences, that keep track of radio ownership transactions, market share and revenues, that track retail sales and box office grosses, and at least three services that monitor what is being played on commercial and noncommercial radio. Many radio stations, music labels and advertisers subscribe to these services so they can get up-to-the-minute information about their own activities, and those of their competitors.

In other words, radio stations are already very data rich. What’s now required is the political will and organizational capacity at the FCC to determine what questions need to be asked, how frequently, and of whom, and then to seek out or collect the information it needs to be an effective regulator. Nonprofit organizations like FMC have been conducting much of this oversight work on behalf of the public interest, but clearly the FCC needs to play a greater role. The FCC could acquire data from commercial sources, or it could request data from stations as part of their responsibilities as broadcast licensees, or some of both. Regardless of the method, the FCC needs to clarify its oversight role, then rigorously and consistently monitor what’s happening in radio in order to craft more effective policies and enhance accountability.

2. Refocus on Localism

Both anecdotal and empirical evidence indicate that commercial radio has become a risk-averse media that employs cookie-cutter formats across many radio properties. In recent months, commercial radio has also been the source of layoffs and downsizing as it struggles with both reduced ad revenue and huge debt loads racked up during the station buying spree following the passage of the 1996 Telecommunications Act.

The radio industry is clearly in crisis. Stations have lost touch with their local markets, but unfortunately, the industry seems to have responded by pushing for greater consolidation and syndication. FMC believes this is the wrong way forward, as radio’s chief advantage in the modern media landscape is “live and local.”

We join others in the media reform movement – and many in the radio industry itself – in calling for commercial radio to regain its local foothold and build programming in which serving its local community is its primary goal. We also simultaneously call on the FCC to revisit the localism proceeding and design clear guidelines about how to measure whether its licensees are honoring their obligations to the communities in which they operate.

We know that locally oriented programming isn’t as cost-effective as running a station using pre-programmed playlists and automated DJs, but it is radio’s strongest asset in an increasingly saturated media environment. FMC and our partners have engaged in pilot projects with small commercial operators to determine best practices for engagement between programmers and the independent sector to set goals and identify mutually beneficial marketplace solutions, and we hope that these projects help us to convey information that other stations can use in the future.

3. Expand the number of voices

This report also shows us that major swaths of the music economy aren’t currently represented on commercial radio. It outlines the many structural barriers to airplay for all types of labels, but for independent musicians in particular. Using other metrics to measure the profile of some indie artists, including retail and digital sales, TV appearances, large live shows, and licensing deals that place their songs in movies, video games and in ads, the lack of airplay on commercial radio for the same artists seems counterintuitive. Independent music belongs on commercial radio and is just as vital as the music currently receiving heavy airplay. Changing the prevailing culture at commercial radio will take a concentrated effort with all parties working in good faith basis; identifying structural barriers to airplay in this report represents part of this ongoing effort.

Finally, this also moment in time when the government can make a conscious effort to expand the number of broadcasters in this country. The passage of legislation to allow Low Power FM in more American towns and cities would provide local groups and organizations with an opportunity to serve their communities.

Feel free to let us know what you think!

Who Needs Earth Day When There’s Record Store Day?!?

Although many independent and mainstream music stores have closed over the years due to a decline in CD sales and general economic turbulence, there are those shops that have dug in their heels in the face of an increasingly technology-driven music industry. These survivors took part in the second annual Record Store Day, held this past Saturday (April 18) in stores all across the nation.

For those unfamiliar, Record Store Day is celebrated yearly on the third Saturday of April. On this fine day, the country’s independently owned record stores to come together with artists to celebrate the dazzling dance of music and commerce. This year, top acts like Franz Ferdinand, Erykah Badu and Ani DiFranco all gathered to pay homage to their hometown record stores while others like Bruce Springsteen, The Smiths and Modest Mouse offered limited special-edition vinyl releases for the occasion. As music junkies, we get pretty psyched about this “holiday,” so we figured we'd give you a little recap on how things went down in the District.

DC staples such as CD Warehouse, Crooked Beat Records, Melody Record Shop and Smash! all opened their doors to throngs of music fans who lined up hours before opening to get their hands on exclusive releases from their favorite artists. Melody Records, for instance, offered limited-edition seven-inches from the likes of Green Day and Jane’s Addiction, as well as reissues (although if you weren’t there early enough you could forget about those). Other treats included goodie bags filled with indie samplers, gift certificates, posters and discounted CDs.

Despite the success of Record Store Day, it’s still tough out there for music sellers. Just a couple of weeks ago it was announced that DC staple DJ Hut (known for their extremely awesome vinyl collections) will be closing its brick-and–mortar shop at the end of this month to become a strictly online record store. This trend has become all-too familiar to music fans these days.

On the upside, reports are suggesting that because of Record Store Day (and all of those cool exclusive releases) traffic and sales volume this year will eclipse the previous event. Which is very good news for independent retail owners (and musicians). Who says Christmas only comes once a year?

The Best Curated Panel Ever?

OK, we know it’s been a while since we’ve talked about net neutrality. But we figured you could use a break. Not that it’s not still relevant — actually, the reason we’ve blogged about the issue so much in the past is because net neutrality — the principle that protects the open internet —is crucial to artists and fans. Today’s musicians depend on the web to reach potential audiences without the interference of gatekeepers, toll collectors and middlemen — which could change if net neutrality goes away.

There have been some promising signs that net neutrality is here to stay, but the fight to preserve the open internet is far from over. (Need a recap? Have a look at our Rock the Net campaign, previous blog posts and our net neutrality fact sheet.)

So, with all this in mind, we figured you might want to check out this discussion sponsored by the Pop Montreal Symposium (a Canadian organization that fosters discussion about music industry issues.) This event took place back in October of 2008, and was moderated by FMC founder and General Counsel, Walter McDonough. Joining Walter in the feisty back-and-forth were music artist Keith Serry, Alain Brunet of the Creators Coalition, NDP MP candidate and journalist Anthony Hamond and technology journalist Anne Lagacé-Dowson. (Walter called this the “best curated panel in the history of panels,” so you know it’s gotta be interesting, at least!)

The conversation touched on issues ranging from the future of the recording industry, the iTunes, illegal file sharing and. . . renowned music authors who were former deadheads? Oh, yeah — and net neutrality is in there somewhere, too.

Variable Pricing Lands at Online Music Retailers

You may have heard the news about Apple's iTunes store moving to a variable pricing model, which means no more fixed 99 cents for individual songs across the board. (iTunes previously had different pricing on its DRM-free "iTunes Plus" offerings, but that looks to be all over, as the retailer is removing all the digital locks from its 10 million-song catalog.)

The major labels have long pushed for variable pricing at iTunes, and they finally got it. According to reports, Apple negotiated a with the labels to remove DRM from their tracks in exchange for a tiered pricing plan with "less popular" songs at 69 cents and up to $1.29 for current chartburners. The new scheme kicked off with little fanfare from Apple on April 7. [UPDATE: Check out this article by Glenn Peoples of Billboard about how the price changes are affecting sales ranking.

FMC asked our Twitter pals if this would affect their purchasing habits; here's a handful of the responses:

summervillain: much less difference to me than removing DRM. But sounds like it could benefit the long tail?

bryanvargas: iTunes is already a bad deal. Emusic & Amazon are much better options.

villageworkscan: I think it will devalue MP3s for unknown indie artists. There should be a minimum scale - > don't like? don't buy

Disasterdisastronaut: iTunes is last port of call if I'm really, really desperate - after hypem, napster, ping.fm etc amazon move 1st of many!

AngelaOrtiz: Do people still buy music? :-)

We hope that last tweet was tongue-in-cheek.

This informal, completely unscientific survey indicates that some folks aren't big iTunes customers to begin with. This is interesting, because not long after we asked the question of our tweeps, we caught wind that other digital music retailers — namely, Amazon, Lala, and Rhapsody — are moving to a variable pricing scheme, too.

So we might as well ask again: what do you think of variable pricing for digital downloads, and will it influence your purchases?

This Week In News

Music Fans Will Buy Songs, Says Head of Free Online Music Site Spotify
Record sales are down, illegal file sharing persists and a whole generation is getting used to enjoying music for free. But Daniel Ek, the man behind Spotify (still not available in the US), the world's fastest growing online music service, is convinced that fans will still pay for songs they love if they are packaged in the right way.
Alexandra Spotting, Guardian UK

CD Baby Payouts Cross 100 Million
Sometimes, simplicity pays, and in the case of CD Baby, artist payouts have now passed $100 million. ... The critical question now is whether avenues like CD Baby can generate serious artist salaries, instead of just impressive aggregated payouts. [FYI, CD Baby founder Derek Sivers is also FMC Board of Directors] Digital Music News

Next Generation iPhone & iPod Touch to offer Low Power & Wireless Radio
The next iterations of the iPhone and iPod Touch are likely to have 802.11n wireless radios inside, offering lower power consumption, longer range and faster data rates. More importantly, it will mean that you can hook your handheld up to your n-enabled home network and not slow everything else down. Wired.com

Is MP3HD the Future of Digital Music?
For all its joys, MP3 is an old format - and it's lossy, which means no matter how high the bitrate you never get a perfect copy of the original audio. Thomson, the firm that helped invent MP3 in the first place, has come up with a solution - MP3HD, and you won't need to bin your existing kit as the file format will still play on normal MP3 players.
Techradar.com

The YouTube DJ Cutting Up Copyright
Kutiman has become an Internet sensation with his mash-up tracks and videos culled from YouTube clips. There is indeed something new about Kutiman's approach to making music: all his songs, and the accompanying videos, have been painstakingly clipped together from YouTube clips of disparate, mostly (defenseless) amateur musicians. YouTube.com

Obama: Stop Filling Administration with RIAA Insiders
Nearly two dozen public interest groups, trade pacts and library groups urged President Barack Obama on Thursday to quit filling his administration with insiders plucked from the Recording Industry Association of America. Groups such as Public Knowledge, the Electronic Frontier Foundation, the Consumer Electronics Association, and the Wikimedia Foundation and, among others, the American Library Association, are demanding Obama to look outside the content industry when filling up his administration.
Wired.com

Drama on Top of Drama: Ticketmaster Scrutiny Keeps Intensifying
The concert industry's favorite bad guy is now getting pummeled. After a Springsteen-inspired flare-up, the investigatory and legal flurry surrounding Ticketmaster keeps intensifying, across several fronts. [For more info on the proposed Live Nation and Ticketmaster merger, check out our earlier post.] DigitalMusicNews.com

Let the Fans Decide: KISS Practices Touring Democracy…

Why not let the fans decide where a band should tour? That is exactly what KISS is now doing, a novel concept that could reshape live gigging. The band has now announced a partnership with Eventful, specifically for upcoming North American dates. "No matter where the fans say - from stadiums to cornfields - if there are enough votes, KISS will be there," the group declared. DigitalMusicNews.com

D.I.Y & the Death of the Rock Star
The industry has long theorized that the current media landscape is simply unable to create the mega-bands of old, on the order of Guns N' Roses, Kiss, Van Halen, Led Zeppelin, or Black Sabbath. Why? DigitalMusicNews.com

FMC Releases "Artist Principles"

You don’t have to be a super-genius to notice that the music economy isn’t exactly stable at the moment. (Then again, neither is the rest of the economy). One thing is certain — sales of compact discs continue to plummet, and it’s tough to predict which of the new music services will thrive — or even survive — in this period of transition.

Check out this article in Digital Music News for a thoughtful look at the state of digital music in 2009, and a few salient predictions of where things might end up a little further down the road.

Launching a music site or service that’s simultaneously affordable, appealing to music fans and fair to rightsholders is clearly difficult, especially in today’s economy. It’s a tough time for many of these new sites and services, but articles like the one above always get us thinking about those who create the music itself. From the beginning, FMC has stood for the right of musicians to be paid for their work, so we want make sure that artists aren’t overlooked in the ongoing experimentation with new music business models.

This is why today we’re releasing “Principles for Musician Compensation in New Business Models” (or “Artist Principles”) — a set of guidelines for ensuring creator compensation in an evolving music landscape. Crafted by Ann Chaitovitz with input from over a dozen industry experts, the Principles represent an important first step in ongoing discussions about musicians’ revenue streams.

We’re called the Future of Music Coalition, so we like to look ahead. In fact, the Principles are primarily meant to apply to music services that have yet to be brought to market. But, FMC also knows it’s important to learn from the past. The majority of the Principles are based on what we’ve observed from the launch of existing services. For example, you might recall our earlier post about the launch of MySpace Music, which saw the major labels enter a joint venture with the social network that reportedly included a cut of the advertising and equity stakes in the enterprise. Yet it remains unclear if or how the labels plan to share that equity or ad dollars with their artists.

And that’s just one example. With music moving beyond the physical (and even download) model, it becomes increasingly important to make sure that musicians are fairly compensated. Regardless of the system, artists deserve to be paid for their work — especially considering it’s their music that’s attracting listeners (and hopefully, dollars) to that service.

But without reasonable guidelines, creators could be excluded from any revenues generated by these new models. Hence, the Artist Principles. We’ve even drafted a point-by-point explanation of each principle, offering examples and what we think are possible ways forward, which you can read here. Just trying to be helpful.

Clearly, there’s no silver bullet solution to the challenges currently faced by artists, musicians and entrepreneurs. Yet, as always, we think the best thing to get a conversation going. And the Artist Principles surely will.

The New DIY?

There's been been a couple of online articles recently (that's one shy of three, which almost makes a trend!) about what "do-it-yourself" means in the era of digital music. So we figured we'd do a little thinking out loud, then turn the floor over to the experts — in other words, you.

With the advent of user-friendly digital distro services, musicians now have a wide array of relatively inexpensive tools to get their tunes out there. Of course, with fewer gatekeepers and the "democratization" of technology, it also means you probably have to work harder to get noticed — there's no slick suit who can make it magically happen for you. (And if there is, maybe s/he can give us a call?)

All of this upsets the traditional artist-record company relationship, which we've seen borne out by the increasing number of established acts who have ditched their labels in favor of more "experimental" approaches to marketing and distribution. (Insert tired Radiohead/Nine Inch Nails analogy here.)

But can an up-and-coming artist really be their own label? Superstars clearly have an advantage in terms of the critical mass needed to achieve success with direct-to-fan schemes — most have already benefited from "traditional" label arrangements during their developmental phase. So what does DIY mean for the struggling artist/part time barista?

It kind of depends who you ask.

Digital Music News published a piece this week called "DIY and the Death of the Rock Star." This paragraph basically explains their take:

Major labels no longer have the ability to generate huge blowouts, thanks partly to media fragmentation. Then again, direct-to-fan relationships have never been easier to build — one dedicated fan at a time. Indeed, those that toil to super-serve a core audience can reap the rewards, perhaps enough to quit the day job.

The article also cites indie-punk-cabaret goddess Amanda Palmer, who has become quite the Twitterer lately:

. . .despite the hype surrounding DIY, big questions continue to surround the ultimate payoff for unknown acts. Either way, artists can expect to dedicate extreme efforts and lots of connected time to achieve traction. "I'm spending a lot of time connecting with fans... and I don't feel as much of an artist as much as a promoter of Amanda Palmer," Palmer relayed. "All of this instant connection has taken the place of making art. An idea that might have translated into a song before might now go into my blog instead."

The quasi-snarky music/biz blog Idolator recently published a post with the awesome title, "Is DIY Just Another Word for Nothing Left to Lose?" FMC's founders can no doubt identify with this section:

The do-it-yourself attitude, conceived out of a combination of ambition and necessity, was revelatory to a particular generation who may have grown up with punk but still saw the movement's bands releasing albums on major labels; what started as adding a lower rung to the ladder became an end goal in itself, with labels like Dischord and K insisting that DIY techniques represented a way of making music that was anti-hierarchical, inclusive, and democratic. Artists who chose to subscribe to that particular philosophy became part of a system of mutual assistance which, at least theoretically, enabled them to make music without the need for a major label's resources.

In the current age, DIY seems to have reverted to being a stepping stone to greater success, whatever that might mean. Except that, instead of being a lower rung on the ladder, the DIY rung is rapidly becoming the entire ladder, at least to hear a lot of folks tell it.

The fragmentation of traditional gatekeepers, the changing role of labels, tough economic times and rampant file-sharing are all factors in what can only be described as a major paradigm shift in the business of music. But it's not all doom and gloom: increasingly artists can make their own career choices, from DIY tour booking to stocking music with digital retailers. Although it's probably too early to predict how all his will play out, FMC is planning a study of musician income streams that will hopefully provide a clearer picture about how these disruptions/opportunities are affecting artists' bottom lines.

We wouldn't want to call ourselves prescient or anything, but the other day (before the aforementioned articles were published), we conducted a non-scientific, "just for fun" experiment with our Twitter followers. We asked them "What does DIY mean to you?" and received a ton of interesting responses. Here's a handful:

ANTIQCOOL: Freedom! no suits telling me what to release.

talegends: DIY to me means "you know you can't afford to hire anyone, so if you want anything to happen you have to DIY!"

oastem: DIY means forging your own tools to follow your vision wherever it takes you be it over/underground.

travisnorman: DIY for me = The Freedom to pursue your vision precisely as you imagine it, without compromise.

Interestingly, no one said "too much damn work." Although one person seemed to take the question a bit too literally: "DIY means 'do it yourself,'" they said. Well, we're glad to have cleared that up!

If you haven't already chimed in, tell us in the comments what DIY means to you!

Jill Sobule and Josh Freese Have Fun With Marketing

You don’t need us to tell you that economic times are tough — musicians are feeling the financial pinch just like anyone else. On the upside, they're getting really creative about how they make music and market themselves. From a personal "lunch date" at the Cheesecake Factory to a live performance in your living room, today's artists are doing whatever it takes to establish a fanbase and hopefully sell some music.

As David Byrne (who actually appeared at our 2006 Policy Summit) once sang, “same as it ever was.”

Or is it? Musicians like Josh Freese and Jill Sobule are taking the artist-fan relationship to a whole new level. Both musicians have had pretty solid careers — Freese is a drummer who’s recorded albums with Nine Inch Nails, Devo and A Perfect Circle ( to name a few); Sobule is a songwriter who sang about “kissing a girl” back when Katy Perry was still in Junior High. And both have new albums out and are inviting fans to play a more direct (and atypical) role in their success.

Like many musicians, Sobule has had a rocky relationship with record labels. After being dropped by two majors and living through the bankruptcy of two indies, she decided in 2008 to take matters into her own hands. Sobule started a fundraising drive to help record her next album. And what rewards her benefactors would receive: t-shirts, a personalized voicemail theme song, live performances at fans’ pads and, for the right price, the chance to contribute background vocal to her album. ”If you can’t sing, no problem — we can fix it on our end,” she said. Sobule raised an astounding $75,000, which she used to make her record and is now hoping the buzz will help generate CD sales. (Check out an interview with her here.)

In-demand drummer Freese claims his last CD sold somewhere between “three to five copies” but he’s hoping that his latest disc will do a lot better, thanks in part to his new marketing strategy (somewhat old news, but still awesome).

Freese is counting on his connections with industry vets and a passion for “fine dining” to help move units. Ever wondered what Pearl Jam guitarist Stone Gossard’s favorite song is? Well, if you cough up $500 for Freese, he’ll have Stone personally write you a letter letting you know. Crave a three-course meal at the Cheesecake Factory with Mr. Freese himself? If you can cough up $250.00 your dream can come true. And if you have $75,000 that Bernie Madoff didn’t get to, you, Freese and Danny Carey from Tool can all trip on ‘shrooms and ride around in Carey’s Lamborghini (people, we are NOT making this up!) What hedge-funder wouldn’t jump at such a unique opportunity?

All jokes aside, the “new DIY” is changing the way musicians are selling their wares and getting attention in a noisy media landscape. It's also cool to see musicians finding humor in an industry saddled with declining sales and finger pointing. Maybe even laughing all the way to the bailed-out bank.