A Moron In A Hurry

October 24, 2006

Not Sympatheitc for Studios

Filed under: Uncategorized — nick @ 4:05 am

LAT runs a nice piece on the growing tension between studios and talent in Hollywood, which the paper suggests may even lead to a strike as labor unions, such as the Screen Actors Guild are becoming testy towards studios’ behaviors.  The issue boils down to entertainment contracts, with talent wanting to ensure they get a cut from new technology while the studios are trying to insist that everything new is covered by the old contracts.  One key point seems to be residuals, where artists are paid for every time their work is shown.  For example, the number of times a commercial runs on TV is kept track of and, depending on their deal, those involved in making it get a small check each time it airs.  This is standard, but not yet for online.  Back in February, ABC said that it was applying its homevideo rates to content bought on iTunes, meaning above the line talent would get about about four times less than it would under the rates for regular TV (which is only about 1.2% anyway).  Ask youself, is iTunes or YoutTube like homevideo, or is it something decidedly different?

Entertainment companies taking advantage of artists is nothing new and only gets worse as technology changes.  Back in April, the Allman Brothers and Cheap Trick sued BMG over what their contracts had to say about digital distribution, which was nothing at all since the contracts predated online music.  First off, it turns out that BMG still deducts packaging and other costs tied to CDs, when there are no CDs.  Second, BMG gets 80 cents of every 99 cents spent on iTunes and pays the bands only 4.5 cents because that is the rate for sales, as opposed to 30 cents per song if it were characterized as being licensed to users.  BMG argues that, in fact, these are sales while the artists argue for the licensing scheme.  Funny, though, that Big Content always seems to suggest the license argument when they opt for new DRM.

And then there is Mr. Yankovic.  In June, Weird Al was asked whether he made more money from sales of CDs or mp3s and the answer was decisive: CDs net him way more money.  Since making those comments his new album, Straight Outta Lynwood, debuted at #10 on the BillBoard 200.  This is the first time he has cracked the BillBoard top 10 and has less to do with his music somehow being better (I’ll argue its not as good as the old) than that he’s tapping into what can be done online with free downloads and video.  Weird Al has himself credited the Internet for the success of his new album.  Only upon going this route did he make the top 10.  Seems counter-intuitive: pursue the format that doesn’t make as much money and yet end up with the biggest hit of your career.

Whether it be with movies or music, there is a clear whiff of greed coming off Big Content as it lumbers into the online marketplace.  It always drops the “we’re just protecting the artist” card, but Hollywood and the labels have shown that they themselves may be the biggest danger to most artists.  Plus, the kind of free promotion that Weird Al used (no DRM, free sharing and downloads, videos on YouTube) to break the top 10 are exactly the kinds of things the studios and the RIAA consider stealing and blame for destroying the entertainment business.

I’d bet $20 that the above the line talent gets screwed in their deal with the studios, putting the studios in the unenviable position of both seeking to monopolize their power through copyright and monopolizing the ability to screw artists.


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