Wednesday, April 26, 2006

Show Him The Money

Inside the grimy beltway in DC, Lawmakers are currently trying to pass the PERFORM act. According to Billboard:
The Feinstein-Graham PERFORM Act -- the Platform Equality and Remedies for Rights Holders in Music Act of 2006 -- would require satellite, cable and Internet broadcasters to pay the same royalty rates, reflecting the fair market value, for the performance or distribution of digital sound recordings of music. It would also require the use of readily available and cost-effective technological means to prevent music theft.
Two sides (satellite radio v. labels) are lobbying on opposite ends. Bronfman and others argue this is about fairness, while the sat radio people claim this whole exercise is a negotiation tactic.

I don't have a satellite radio. I'm one of those people who likes to pick almost exactly what they are listening to, and thinking of hearing anything without being able to fast forward drives me crazy. As a music fan,being able to download music from streaming broadcasts seems like a cool idea. If I like it, I can have it on demand.

The problem for me comes as a label guy who's trying to fund marketing and new recordings. I'm compelled to agree with Mr. Bronfman that anything that enables someone to download a perfect copy of music and then add it to your personal collection is indeed an alternate method of digital distribution. (Although I do think the "technological means to prevent music theft" aspect of this law is impossible to enforce.)

However, If you look at the big picture, this seems like the first step to the industry at-large bumbling their way into actually doing it right. At it's core, this legislation takes the download fees off the top, so essentially the downloads are painless and free in spirit (if not in reality.)

I've always been a huge fan of the eMusic model. You pay a few bucks and get to download a pretty significant amount of music. They then divide the revenue on a more or less pro-rated basis (after backing out mechanicals.) As their subscription builds, the pie gets bigger and bigger and is a boon for everyone. People get music on the cheap through a reliable service and the artist actually gets paid.

Take this to another level. If household and business ISPs (who take money for providing pipeline for this) and satellite radio (ditto on the pipeline thing) added a somewhat "invisible" music surcharge, ($2 a month?) and then process those payments on a pro-rated basis to the rightsholders (artists/labels) through an entity like SoundExchange. After a small adjustment period, music would wind up being like a water bill. (every time you turn on the shower, you don't think about how much it costs to scrub your ass, do ya?)

I can't wait to see how they fuck it up.

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