labels vs. artists: a lot of money is at stake
  • WEDNESDAY, APRIL 13, 2011

  • Posted by: Matt Howard

Large music labels may owe up to $2.15 billion to their artists. Following F.B.T Productions' (Eminem's cronies) lawsuit against Universal Music, artists are recognizing the existence of unpaid royalties. The dispute involves the profit that is acquired via the digital music medium. The apparent problem is the distinction between selling music as "copies" and as "license". Copies are the physical products like CDs and vinyl, which provide artists with 10-15% royalty. License, however, is music purchased digitally, which grants artists 50%. This licensing agreement is absent from contracts of many artists who were signed prior to the digital revolution of music (most recent contracts include it).

The ruling of the case will have profound affect on the music recording industry as we know it. The cloud players and other forms of digital copy that we've all become quite comfortable with will certainly be affected once commissioned by license.

While we stood strong during the Napster dispute (we want free music, screw Lars), in the current conflict we take an alternative approach. Now that we pay for music (well, most of us), it's much easier to identify with the artists. The creative community and the business world have always been like oil and water. The prices that we may have to pay as consumers will be well worth the sustainability of the music industry.

For all the dispute's details, click here.
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