My Hilarious Warner Bros. Royalty Statement

[jgyn]

From the band 'Too Much Joy':

http://www.toomuchjoy.com/?p=1397

[A-Bone]

It is a pretty great article. I read it yesterday.

[getbent]

I'm just glad rhapsody is still in business...

it made me think of the conversation in the studio in "That Thing You Do"... just kind of sad and real...

[TommyMambo]

And I thought my BMI check for $.05 was a hoot...at least I am in the black!

[Jazzydave]

This is a great read. I'm going to go back over it later when I have more time.

I played the label game for a little while but I'm so glad I didn't get that deep into it. There are a few people who have slipped through the cracks (John Mayer, Regina Spektor, Norah Jones, etc) but I just couldn't live up to being a cheesball in order to sell records.

With the power of the internet, there's really no need to sign to a major if you're ok with not owning a $50M home. I'm ok with that. I just want to be able to play my music, share my love with others, and not have to wake up at the crack of dawn to go to a job I hate.

:aok

[GerryJ]

How accurate do you believe their balance of "$395,277.18" is?

Is it possible that they were not too savvy in buying the occasional fruit tray or potato salad for your band, and got ripped off by Walmart?

[67blackcherry]

From the band 'Too Much Joy':

http://www.toomuchjoy.com/?p=1397

Kudos to you; keep going after them.
Your letter was spot on in so many places, I don't even know where to start. I loved the "we're at a swank hotel on..." having a conference about how to save the labels.

Record company labels are becoming a thing of the past, it's only a matter of time.

[Fretgears]

How accurate do you believe their balance of "$395,277.18" is?

Is it possible that they were not too savvy in buying the occasional fruit tray or potato salad for your band, and got ripped off by Walmart?

I'm guessing the first culprit would be a producer, the second probably the label's so-called marketing.

[mojocaster.com]

thanks for sharing. How eye opening!

[Jazzydave]

I'm guessing the first culprit would be a producer, the second probably the label's so-called marketing.

They get you on the marketing costs. Even with the initial "small" bit of advertising we were going to do with my acoustic pre-cursor, they were talking $10k plus. That was just for some local radio and push.

[enocaster]

I have a few of your albums!

[Jeff Michael]

When you're--I want to say "young", but it's not necessarily age-associated--"getting signed to a label" seems like the ultimate success. Really it's like the worst trap your music career can fall into.

Labels look like the only way to go: all the big guys are on labels, therefore if I get on a label I must be a big guy. Totally flawed logic, but it seems sensible enough, especially when the thinker in question wants it to be true. It's like casinos: a winning slot machine erupts in light and sound every once in awhile here and there while the rest of them are constantly quietly siphoning money away from losers. Record labels are for all intents and purposes loan sharks. You would be just as well off using a credit card to pay for studio time and just hitting MySpace, Facebook, YouTube, and whatever else there is out there that I don't even know about to promote yourself. Talent and creativity get noticed, mediocrity falls by the wayside. It's not like the labels have magic wands or anything.

JAM

[ABKB]

I got our bands debut album coming out this month, and while it's a pain to lineup everything one needs to lineup (Mastering, I Tunes, distribution etc...), it's more and more obvious to me, there's just no reason to go with a major label anymore. None.

[Jazzydave]

When you're--I want to say "young", but it's not necessarily age-associated--"getting signed to a label" seems like the ultimate success. Really it's like the worst trap your music career can fall into.

Labels look like the only way to go: all the big guys are on labels, therefore if I get on a label I must be a big guy. Totally flawed logic, but it seems sensible enough, especially when the thinker in question wants it to be true. It's like casinos: a winning slot machine erupts in light and sound every once in awhile here and there while the rest of them are constantly quietly siphoning money away from losers. Record labels are for all intents and purposes loan sharks. You would be just as well off using a credit card to pay for studio time and just hitting MySpace, Facebook, YouTube, and whatever else there is out there that I don't even know about to promote yourself. Talent and creativity get noticed, mediocrity falls by the wayside. It's not like the labels have magic wands or anything.

JAM

This is a great post. :aok

[Festus]

Yes, great post. I've run into several people with a very similar story, unfortunately. A "record deal" with a major label is probably the quickest way to go $400K+ in the red for your first release. Gack.

[Dickie Fredericks]

They get you on the marketing costs. Even with the initial "small" bit of advertising we were going to do with my acoustic pre-cursor, they were talking $10k plus. That was just for some local radio and push.

The last Nashvegas cat I worked with dumped it out of pocket because the label didnt want to LOL

11k for a publicist to get a single played on the radio. Wow...

Back to the thread though... I hate major labels and hope to see a day where they are gone and everyone is their own label, period.

You make records and you drop it online and if people like it they can buy it one song at a time or album as a download with the option of a physical product mailed to them.

Hey, I can dream right?

[Falstaff]

I dated someone who knew your drummer.

I was in a bad punk band during my high school years and the diehard singer just managed to get an EP put out on vinyl. Somehow, songs I wrote between popping zits are now available for download for fifteen cents. I am not sure how that happens (or in this case why) but it's strange.

[FFTT]

I know another WB artist from another un-recouped band who found out
that while "the band" received a big advance, certain heavy weights at the company
were skimming $1000's a day for their own personal indulgences, off of those "recording advances", but charging it off to band expenses.

He accused them of embezzlement and was immediately black balled in the industry for daring to expose the truth.

[Jazzydave]

The last Nashvegas cat I worked with dumped it out of pocket because the label didnt want to LOL

11k for a publicist to get a single played on the radio. Wow...

Back to the thread though... I hate major labels and hope to see a day where they are gone and everyone is their own label, period.

You make records and you drop it online and if people like it they can buy it one song at a time or album as a download with the option of a physical product mailed to them.

Hey, I can dream right?

This is why I now focus on non-profit, internet, and college radio stations. Not only are they usually playing better music, but the DJs are actually PEOPLE and are willing to play a b-side if they like it.

[padavis]

If you go through Myspace and Facebook and Twitter and digital sources to promote a self-made cd how do you protect your songs? I am thinking very seriously about recording a short cd all on my own and I would like to get it out there if I get anything good enough but I want to make sure my stuff doesnt end up on someone elses cd because I didn't protect my stuff.

[GerryJ]

From the liner notes of a Weather Report CD awhile back, 'live and unreleased', they had an unusual arrangement with their rec company- they were all on a negotiated fixed salary, no advances or deductibles. The company maintained that the band was a loss leader but gave 'prestige', maybe true, but I'll bet after 'black market' the company made a good profit in the big picture.

[Bassomatic]

Terrific stuff.

Back in the 90s, a band I was in had a single released in France. We had friends living there at the time who reported hearing the tune on the radio, seeing the CD widely available in CD outlets, etc.

We hounded and hounded our minuscule US label for royalty statements from the French distributor.

Surprisingly, we had sold exactly zero units in France. Seeing "0" repeated so many times on a single document was both sad and surreal- it was our first taste of the music biz ugliness we'd heard so much about. Guess the CDs we know were purchased (by friends/fans we were in touch with) somehow escaped the vigilant parties looking out for our best interests.

Sales reports for the US were similarly zeroed, despite seeing the CD in Tower Records, etc. while doing our few short tours. I'm quite sure we sold at least a handful, and this was before the existence of mp3 pirating on the net. All of this was enough to convince me of the corruption of large and (most) indy labels alike.

In the long run, we may have ended up ahead of the game when we were dropped by our failing label (thanks too a damned nice van that, when sold, earned us each a few grand). We also got them to pay for a bunch of recording they had never intended to, as our contract stated we could begin recording our 2nd CD whenever we wanted too. (They were *not* happy when we told them we'd booked a friend's studio for a few weeks of recording, and the bulldog of a studio manager got them to fedex funds up front - a real exception to how things are normally done).

[dognmoon]

If you go through Myspace and Facebook and Twitter and digital sources to promote a self-made cd how do you protect your songs? I am thinking very seriously about recording a short cd all on my own and I would like to get it out there if I get anything good enough but I want to make sure my stuff doesnt end up on someone elses cd because I didn't protect my stuff.

My quickest suggestion would be to make sure you do your paperwork. Make sure your recordings and songs are filed with the Copyright office and it wouldn't be a bad move to join a performance royalties organization so you can see any earnings if you push hard enough to get the song placed in the public eye (film, tv, etc.).

[Jazzydave]

My quickest suggestion would be to make sure you do your paperwork. Make sure your recordings and songs are filed with the Copyright office and it wouldn't be a bad move to join a performance royalties organization so you can see any earnings if you push hard enough to get the song placed in the public eye (film, tv, etc.).

Yep, plus keep in mind that by law, you own the rights to the song and/or lyrics as soon as you have written them down or recorded them. The paperwork process only anchors you as the owner in case someone else claims they wrote the song.

When you upload a song to Myspace, Facebook, Youtube, etc, there is a digital time stamp. Now, I'm by no means saying that you shouldn't file with the copyright office but it'd be hard for someone to claim they had the song first if you have it on several sites, have played it out, long before they make the claim.

Also keep in mind that you can copyright an entire "collection" at once - this is much cheaper than doing each song individually. Many singer/songwriters I know do it this way to keep costs down.

If you're a songwriter, you should seriously look into this process and know it well!

[michaelvincent]

It amazes me that a record label will scoff at $10,000 being "nothing", yet they'll calculate a balance like the one that band had down to the penny.

Seriously....when you get into the hundreds of thousands like that how does it even matter anymore? The final balance should just read "bend over, think of a warm place."

[Ted Witcher]

My favorite story, because it indicates they try to screw both at the low end and at the high end:

Friend of mine was a senior exec at a major. A very famous artist was telling him that he had just renegotiated his deal in the wake of a monster album. He had held out and gotten a deal worth $12M over however number of records. Big success, right? Pop the champagne, right? My friend asked him if he had "cleared the pipeline" -- meaning, had he gotten the label to account for all of the money due up to that point. He hears from this guy later and it turns out the label owed him $14M. They granted him his new fat contract worth less than what they owed him and were just going to pocket the remaining two million. Conclusion: manager got fired.

And when Prince started running around saying, "Hey, this is a bunch of bullshit," everybody looked at him like he was crazy.

[jtm622]

A band I was in recorded an LP that was released in 1972 on a long bankrupt label... But the catch is this: it's been re-issued twice that we know of since then (once on a "Italian" label, and once previously on an "Austrian" Label - and the kicker is: both re-issues were simultaneously released on both 33-1/3 VINYL and on CD formats!!!) Yes - we never realized a penny off of that LP or CD - the cold reality was that we just didn't originally sell enough units... but then I think: "Just why the hell does it keep getting re-issued on labels located in other countries???" ... "And on VINYL, too???" :)

[Jazzydave]

A band I was in recorded an LP that was released in 1972 on a long bankrupt label... But the catch is this: it's been re-issued twice that we know of since then (once on a "Italian" label, and once previously on an "Austrian" Label - and the kicker is: both re-issues were simultaneously released on both 33-1/3 VINYL and on CD formats!!!) Yes - we never realized a penny off of that LP or CD - the cold reality was that we just didn't originally sell enough units... but then I think: "Just why the hell does it keep getting re-issued on labels located in other countries???" ... "And on VINYL, too???" :)

So, if the label went bankrupt, did they sell it off to someone else who's claiming that you still owe them money?

My wife came home from work a few months ago and says, "I've been thinking about this a lot lately - why don't you start your own label?" I'd thought about it before but more so just learning more about it so I didn't screw myself when dealing with other labels.

I'm seriously considering it...even if just to release my own albums and maybe a few others from guys I dig.

[jtm622]

So, if the label went bankrupt, did they sell it off to someone else who's claiming that you still owe them money?



I'm not quite sure what the reality of our situation is here... I don't know who sold what/when/if to whom... We don't own those masters, and I don't have a clue as to where they are. Also, the ASCAP publisher we used is long defunct, and my understanding is that copyright laws changed circa 1972. The main problem is that nobody involved with the band ever knew (or cared) what was going on all those years - that is, until the "internet" became widely popular...
In any case, it's just hard to believe that there is enough money involved to make it worth pursuing - particularly out of the country - because the last company to release it was in Italy - a pretty good-sized label called "Akarma" records - it's a subsidiary of Vanguard Records or something like that... I don't think that they are a "bootleg" outfit - they re-issue the old LP's of really well-known acts, too... I just don't really know... too much water under the bridge... We just chalked it up to experience...

P.S. - I do get royalty checks from the "Ultra" CD, though... :)

[Jazzydave]

I'm not quite sure what the reality of our situation is here... I don't know who sold what/when/if to whom... We don't own those masters, and I don't have a clue as to where they are. Also, the ASCAP publisher we used is long defunct, and my understanding is that copyright laws changed circa 1972. The main problem is that nobody involved with the band ever knew (or cared) what was going on all those years - that is, until the "internet" became widely popular...
In any case, it's just hard to believe that there is enough money involved to make it worth pursuing - particularly out of the country - because the last company to release it was in Italy - a pretty good-sized label called "Akarma" records - it's a subsidiary of Vanguard Records or something like that... I don't think that they are a "bootleg" outfit - I just don't really know... too much water under the bridge...

P.S. - I do get royalty checks from the "Ultra" CD, though... :)

Hey, at least you're getting something out of it! I'm on iTunes, Amazon, etc, etc, etc...haven't scene a cent. Then again, as soon as I found out they had done that, I sent several msgs out letting everyone know NOT to buy it from there.

So, if anyone would like to, please go to iTunes and review my album Influenced - if you want one, I'll email the songs or send you a copy of my CD! I always include a few with my deals here on TGP as well.

*EDIT: I forgot to mention that I actually got out of the deal before it even happened so NOTHING was ever signed on either side. So, the fact that they took what little they did have from me and put it out there was the issue.

[chrisgraff]

And I thought my BMI check for $.05 was a hoot...at least I am in the black!

I have one for $.03. :mob

[AudionAnalog]

this part made me lol

I realized that Warner wasn’t being evil, just careless and unconcerned – an impression I confirmed a few days later when I spoke to a guy in their Royalties and Licensing department I am going to call Danny

[AudionAnalog]

This part is pretty telling too

A word here about that unrecouped balance, for those uninitiated in the complex mechanics of major label accounting. While our royalty statement shows Too Much Joy in the red with Warner Bros. (now by only $395,214.71 after that $62.47 digital windfall), this doesn’t mean Warner “lost” nearly $400,000 on the band. That’s how much they spent on us, and we don’t see any royalty checks until it’s paid back, but it doesn’t get paid back out of the full price of every album sold. It gets paid back out ofthe band’s share of every album sold, which is roughly 10% of the retail price. So, using round numbers to make the math as easy as possible to understand, let’s say Warner Bros. spent something like $450,000 total on TMJ. If Warner sold 15,000 copies of each of the three TMJ records they released at a wholesale price of $10 each, they would have earned back the $450,000. But if those records were retailing for $15, TMJ would have only paid back $67,500, and our statement would show an unrecouped balance of $382,500.

[Fretgears]

So, using round numbers to make the math as easy as possible to understand, let’s say Warner Bros. spent something like $450,000 total on TMJ. If Warner sold 15,000 copies of each of the three TMJ records they released at a wholesale price of $10 each, they would have earned back the $450,000.He's completely leaving out the cost of the retailer/distributor in that example. I'm assuming like most retail, the seller gets half of the disc price?

[GerryJ]

He's completely leaving out the cost of the retailer/distributor in that example. I'm assuming like most retail, the seller gets half of the disc price?


The way I understand it - but I'm not in the biz so please correct if wrong-

if the Rec comp ships 45,000 CDs at wholesale cost of $10 each, those CDs are bought and paid for- the rec co got $450,000. It's the retailers luck if the CD is super hot and they can clear them out quickly at $15-$17 each (admittedly this is mid 90s pre-napster days), or whether the CD ends up in the bargain bin for $5 a year later.
?true

Accounting-wise, I guess he's saying that the band's balance of $400,000 that the band 'owes' the record company is paid off only by debiting 10% of the usual retail price x number of CDs the label shipped.