Major Labels Prepare For Major Revenue Losses Over Copyright Law

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Posted September 8, 2011 by J Matthew Cobb in News
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Copyright fight: The fight is on as the first wave of artists fight for the power of copyright control

If you’re an artist and you released an album in 1978, better listen up.

A provision passed in 1978 by U.S. Copyright Law is set to go in effect in 2013, allowing musicians and artists – including Bruce Springsteen, Tom Petty, Billy Joel, Loretta Lynn, Bryan Adams and others – the chance to gain back control of their master tapes. Although record labels will probably fight the pressure in court, the law allows musicians who recorded material with any major record label with jurisdiction over the masters to do what they desire with them, including the right to terminate their contractual agreements with the labels. They can license their songs for advertising, sell them to other labels (negotiating new record deals), they can re-released their albums if they choose or they can distribute them on their own through online retailers like Amazon and iTunes – eliminating the middleman all together.

According to a report released in Rolling Stone magazine,  2011 Rock and Roll Hall of Fame inductee Tom Waits is one of the many artists trying to end his contractual agreements with his former label and fighting for the rights of his music released during that period, which include Blue Valentine, Heartattack And Vine and One From The Heart.

Steven Greenberg, composer of Lipps Inc.’s 1980 disco hit “Funkytown,” also applied for his rights. “Thirty-five years is long enough for the majors to milk a record,” says Greenberg. “It’s time to give it back to the owners. Plus, it’s the law.”

In August, Village People frontman Victor Willis also filed papers to regains control of his share of the copyright credit of 32 of the band’s songs, including “Y.M.C.A” and “Macho Man.” Scorpio Music and Can’t Stop Productions, the two companies holding the song’s publishing rights, are fighting against Willis’ wishes. “We hired this guy. He was an employee, we gave them the material and a studio to record in and controlled what was recorded, where, what hours and what they did,” Stewart L. Levy, a lawyer representing Scorpio and Can’t Stop told the New York Times. Willis’s lawyer is singing a different tune. “Victor Willis wrote those songs, he was never employed. They didn’t pay his salary, they never took tax returns. In fact, he receives royalties to this day.”

And the list will definitely continue to increase with some of the late-’70’s and ’80’s biggest superstars.

Don Henley, longtime Eagles singer, spoke with Rolling Stone about the advantages of the copyright amendment and some of the repercussions that are subject to come down the pipe. “We still sell a lot of catalog,” Henley says. “So it would mean a great deal to us and our heirs. I have four kids. The future ain’t what it used to be, as somebody once said. For artists like the Eagles and others who have sold millions upon millions of records and made millions in profits for the record companies, those artists should get their creations back. It’s very simple. We created them, we paid for them – why aren’t they ours? But the record companies claim ownership and authorship, which is one of the absurd things in a recording contract.”

And he has a point. Catalog albums at one of the four major labels constitute of 90 percent of recorded-music sales, according to one source. Last year, sales of digital back-catalog albums rose 12 percent, according to Nielsen SoundScan.

Artists who are still signed to their record home since 1972 may want to pause on doing anything major during this season. Any action made attempting to acquire all rights to masters may jeopardize their tenure with the label and poison their relationship. But artists are bound to leave the table with some cuts and bruises from the majors since RS reported that “the legal wording for when a work was conceived and executed is vague, and a “majority” consent of a band would be required.” RS adds that “the labels will also claim the artists were “work for hire,” meaning the labels own the rights in perpetuity.

The big four – Universal, EMI, Warner and Sony BMG – are expected to challenge any artist who try to get in their way. And we understand why – its big news for artists and terrible news for the labels.

So what do you think?
Should the big labels panic?
Do you expect the labels to win the legal fight in the courts?


About the Author

J Matthew Cobb

Managing editor of HiFi Magazine


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