Below is a recent op-ed printed in the Washington Post regarding the state of affairs for streaming music content. Mr. Fakir makes many legitimate points, as there’s no valid reason for streaming services not to have to pay royalties on music recorded before 1972. However, while copyright law is important for aging or retired artists who rely on performance royalties, the long-term problem for creative digital content is far more intractable.
The true problem for professional artists is that the supply of content has exploded while the price has collapsed. This is basic economics: when supply increases faster than demand, prices must fall. The explosion of supply is due to digital technology, which has caused production and distribution costs to plunge almost to zero. Now everybody and anybody can release music on Apple or publish books on Amazon or take thousands of digital photos on their phones.
So the real problem is too much content, reducing the market price while increasing the search costs for consumers. Plunging revenues have also hollowed out the promotion and marketing industries that serve creative content. So now artists not only create, they have to promote and distribute, paying with precious time or money for vendor services upfront. This is a Catch-22 for struggling artists – they have no money unless they sell product and yet can’t sell product unless they spend first on promotion. Meanwhile, digital distribution is monopolized by the big tech companies like Google, Apple, Facebook, and Amazon (GAFA).
- First, technology offers the next disruption. Creative industries need on online clearinghouse for content that is curated by the network of creators, curators, and consumers. Think Facebook for content only.
- Second, GAFA does not make the bulk of their revenues from content sales, but rather from the monetization of the data that flows through their networks. A network of creators, curators, and consumers need technology tools to build, manage, and monetize their personal peer networks. Blockchain technology offers the possibility of constructing such a distributed network for sharing content. Essentially, this is what the big tech servers do with our information data.
In sum, what we face is a globalized niche market where the main problem is less about price and getting paid and more about connecting creators with consumers to build new sources of value. (Note: even sharing free content creates data network value, like on Facebook.) New developments in technology can help us recapture and reinvigorate “the culture industry,” where we take back control of our creative content so we can reap the value we create and sustain a thriving creative ecosystem together.
Duke Fakir is a founding member of the Four Tops and a member of the Rock and Roll Hall of Fame.
I’m a lucky man. I’ve been a performer and recording artist for most of my life. As a founding member of the Four Tops, I’ve been blessed to travel the world making music with my dearest friends, and we’ve seen our records hit the top of the charts. It’s a privilege I’ve never taken for granted, and I’m proud to say that our music has stood the test of time.
I’m also an activist who has spent years fighting to change laws that exploit artists. Our copyright system does not always provide fair compensation for performers and musicians, and I know that not everyone has been as fortunate as I have.
My fellow artists and I have argued for economic justice and fairness for so long, it can feel like the same empty answers keep coming around, and you never really get to anywhere new. And “the same old song” just isn’t good enough anymore.
That makes this moment critical. After years of “hurry up and wait” in Washington, powerful forces in Congress are attempting to fix one of the worst abuses faced by older artists: the “digital rip-off” of all recordings made before 1972.
Right now, digital radio stations such as SiriusXM and iHeartRadio pay royalties to artists for most of the music they play. It’s real money: Digital streams make up half of all music business revenue, pushing $4 billion a year. A lot of that money goes to independent artists, backup singers, session players, and sidemen — including a generation of lost greats who may have played a lot but didn’t get paid a lot. It’s money these folks count on to pay rent, buy groceries, cover medical bills and support their families.
But there’s a catch: Those same stations don’t pay royalties on music recorded before 1972 — not because it’s right or fair or the music is any less valuable. After all, we’re talking about some of the most iconic music ever recorded. But because federal copyright law doesn’t cover recorded music before 1972, some of the huge services that play music from the ’40s, ’50s, ’60s and early ’70s have managed to get away with this inequity, daring anyone who disagrees to sue. Songwriters and music publishers may be getting paid — as well they should! — but the artists and the owners of the sound recordings are not.
This digital rip-off has been a disaster for many older artists, diverting the fruits of their labors — funds that should be their lifeline — to the balance sheets of some of the wealthiest companies in the world. Digital radio earns millions every year from the exploitation of pre-’72 music, from big band to Motown to the British Invasion. Yet artists who recorded those classics — many of whom are no longer able to tour — struggle for basic food, shelter, and medical care. It’s ridiculous, it’s unfair, and it’s about time we make it illegal.
Change is long overdue, but a chance to right this wrong is at hand. A bipartisan new bill called the Classics Act is moving quickly through Congress. The bill would require digital radio to treat all music the same, regardless of when it was recorded, ensuring that the same royalties are paid for older songs as for new material. It would open a world-changing lifeline for musicians from back in the day — bringing basic economic fairness to this key corner of the music world.
Don’t get me wrong — like most artists, I love radio, in all its forms. We’re proud that listeners want to hear our music, and we’re always happy to work with our colleagues to support their platforms, to help promote what they do and to connect with them and their music-loving customers. All we want is to be paid fairly.
We’ve been stuck for a long time in the fight for fairness for music creators. And the Classics Act isn’t the end of the road. We need to finally ensure the payment of a fair performance royalty for terrestrial radio and close the loopholes that allow big tech companies to collect huge profits while paying next to nothing for music.
A great piece of music should earn its fair share, whether it was recorded in 2002 or 1962. And right now, this is a problem that Congress has a chance to fix. In the meantime, I’ll keep singing. And I’ll keep fighting for what’s right. “I can’t help myself!”