There is much uncertainty in the business of music these days. The continuing decline of CD sales, the steadily increasing, but not sufficiently so, sales of digital downloads, the continuation of illegal music downloads, and rising price of gas, all cut into the bottom line for bluegrass performers and creators. We see a lot of statistics and speculation about downloads vs CDs, and the continuing efforts to clamp down on illegal file trading, but what we don’t often see is the efforts being made behind the scenes, by those who love the music and work in the business end of things, to come up with solutions. Solutions that will allow content creators, namely songwriters and performers, as well as the record labels, who finance a lion’s share of the cost of bringing that content to consumers, to continue to earn a living while doing what we all enjoy so much, making music.

These efforts are underway, even if we don’t often see them. What follows is the account of one such effort.

Earlier this month, ASCAP hosted an informal “living room” discussion at their Nashville office, with some of the movers and shakers in the larger music business, along with a few key persons from the bluegrass music industry.

Dan Keen serves as the Vice President of ASCAP Nashville. Dan was my Music Publishing professor when I was attending Belmont University. And more importantly, Dan is a friend of bluegrass. He wrote in to let us know what the meeting was about.

In an effort to help our bluegrass friends embrace the opportunities that the future holds for us all, we thought interaction with some folks who engage in futuristic discourse about music could be helpful. So we invited Congressman (she prefers “-man”) Marsha Blackburn (R-TN) – who co-founded the Songwriters Caucus on Capitol Hill, RIAA head Mitch Bainwol and NMPA President, David Israelite to meet with Dan Hays and other bluegrass leaders for an informal “Living Room” discussion about matters before Congress and the Courts that will have significant impact on Artists, Songwriters, Musicians and Music Execs.

The complete list of those in attendance at this meeting is as follows: Dan Hays (IBMA Exec. Dir.), John Grady (Red Light Management and former head of Sony Records, Nashville), Buddy Cannon (award-winning writer/producer), Alison Brown (1991 IBMA Banjo Player of the Year) and Garry West (owners, Compass Records), Missy Raines (7 time IBMA Bass Player of the Year), Ben Surratt (award-winning engineer), Charlotte Scott (Skaggs Family Records), David Crow (attorney, former IBMA Board Chair, fiddler with the Osborne Bros), Mike Drudge (Class Act Entertainment), Karen Byrd (publicist, fmr manager of the Grascals), Nancy Cardwell (IBMA), Ron Cox (Avenue Bank), Jon Weisberger (journalist, songwriter, and bass player), Dan Keen, Earle Simmons and Chad Green from ASCAP and of course – Rep. Blackburn, Israelite (NMPA) and Bainwol (RIAA).

All these folks sat down in the ASCAP offices and had a candid exchange about the future of the business. I exchanged emails with several of those in attendance to get an idea of the topics of conversation, and a general consensus of outlook for the future. Karen Byrd seems to sum up that consensus with this statement she made about the prevalent attitude of those involved.

I’m thankful to Dan for arranging, and to Mitch Bainwol, David Israelite, and Congressman Blackburn for sharing their time and input on key issues.  It was a great opportunity for me to learn more about the issues at stake.  I was heartened to hear differing perspectives that were united by a common desire to protect intellectual property rights.

So what did they actually talk about? David Crow shared a list of the topics he found particularly interesting during the discussion. (more…)

Newstarget.com published a satire piece last month that is worth the read. The piece builds on a recent lawsuit in which the RIAA maintained that copying a legally purchased CD to your computer’s internal hard drive amounts to making an illegal copy. The author of the piece builds a fictionalized scenario in which the RIAA goes after consumers for remembering songs, claiming that they’ve made an illegal copy of the song in their brain, and that infringes on copyrights.

“The brain is a recording device,” explained RIAA president Cary Sherman. “The act of listening is an unauthorized act of copying music to that recording device, and the act of recalling or remembering a song is unauthorized playback.”

This seems outlandish, but judging by the RIAA recent actions, I’m not so sure it’s that far off base.

My favorite paragraph in the piece follows.

With this decision, the RIAA now considers approximately 72% of the adult U.S. population to be criminals. Putting them all in prison for copyright infringement would cost U.S. taxpayers an estimated $683 billion per year — an amount that would have to be shouldered by the remaining 28% who are not imprisoned. The RIAA believes it could cover the $683 billion tab through royalties on music sales. The problem with that? The 28% remaining adults not in prison don’t buy music albums. That means album sales would plummet to nearly zero, and the U.S. government (which is already deep in debt) would have to borrow money to pay for all the prisons. And where would the borrowed money come from? China, of course: The country where music albums are openly pirated and sold for monetary gain.

I know this is fiction, but at times it does seem that the RIAA thinks all music consumers are thieves.

After you’ve read the piece, go visit The Long Tail and read this article about the idea of an author giving away his book, and think about the music business instead of the book business.

Then read this advise from Seth Godin, who suggests that the solution is to change the business model.

Here’s a key point from his blog post. This is just one of over a dozen pieces of advice he gives the industry.

8. Don’t panic when the new business model isn’t as ‚Äòclean’ as the old one
It’s not easy to give up the idea of manufacturing CDs with a 90% gross margin and switching to a blended model of concerts and souvenirs, of communities and greeting cards and special events and what feels like gimmicks. I know.

Get over it. It’s the only option if you want to stay in this business. You’re just not going to sell a lot of CDs in five years, are you?

If there’s a business here, first few in will find it, the rest lose everything.

In a lawsuit being heard in Arizona, the Recording Industry Association of America (RIAA) is arguing that copying legally purchased CDs onto a computer for personal use amounts to unauthorized use.

Sunday’s Washington Post has the story about Jeffrey Howell who is fighting RIAA in court. Though their primary issue with Howell was his making digital audio files available on a peer-to-peer network, The Posts’ Marc Fisher says that their position on copying CDs onto a personal computer is new, and could have a potentially major impact on the ongoing legal battles about digital distribution of commercially produced music.

RIAA’s hard-line position seems clear. Its Web site says: “If you make unauthorized copies of copyrighted music recordings, you’re stealing. You’re breaking the law and you could be held legally liable for thousands of dollars in damages.”

Whether customers may copy their CDs onto their computers — an act at the very heart of the digital revolution — has a murky legal foundation, the RIAA argues. The industry’s own Web site says that making a personal copy of a CD that you bought legitimately may not be a legal right, but it “won’t usually raise concerns,” as long as you don’t give away the music or lend it to anyone.

Read the Post piece online.

Internet radio has become a great way to hear bluegrass in the last few years. I talk with more and more people who listen online. Now the RIAA has successfully convinced the Copyright Royalty Board (CRB) to adopt at "per play" rate for internet broadcasts. This will result in increased royalty fees for the use of master recordings by internet radio broadcasters.

The new rates are effective retroactively to the beginning of 2006 and continue to increase each year for the foreseeable future. The retroactive rate for 2006 has been set at $.0008 per performance. The rate for 2007 is $.0011, the rate increases to $.0014 in 2008, $.0018 in 2009, and in 2010 the rate will be $.0019.

This doesn’t look to bad until you realize that a "performance" is defined as "the streaming of one song to one listener." That little piece of news sheds new light on these rates. (more…)