I WANT MONEY
I realize “Working Musician: Follow the Money” (November 2001) was created with the novice in mind. But some salient facts weren't included.
The authors state that the record company recoups its expenses for marketing the album. It would also be helpful to indicate which items are not recoupable. For example, music videos are often 50 percent recoupable.
The article provided a good idea of the benefit of songwriting but didn't make it clear that the mechanical royalties are paid before the album recoups. Therefore, the songwriters can earn significant money even though the recording artists are still in the red.
Artist royalties are generally paid on 75 to 80 percent of units to allow for discounts, premiums, promotional giveaways, and so forth. That reduces the recoupment schedule and increases the break-even number of units. Many artists are surprised to learn that they receive royalties on only 75 percent of units sold.
Producer royalties are often on a different recoupment schedule and don't come out of the artist royalties. In that case, it is advantageous to have producer points and songwriter credits.
Steve Corn
via e-mail
I read “Working Musician: Follow the Money” with interest. I would love to see more data and discussion, and I highly recommend Courtney Love's diatribe (www.salon.com/tech/feature/2000/06/14/love) for an alternative view. In addition, what about music technology? The economics that drive research, development, and production of music technology determine, to a large extent, what technologies musicians can use. It's a complex picture, and I would like to understand it better.
Returning to the article, the hypothetical example seems to have a mistake in math. The authors state that the record company recovers its investment at a rate of $5.75 per unit sold, but in fact, the investment is also paid off by the artist at $2.25 per unit. Therefore, the record company recovers its investment after 62,500 units (ignoring the producer royalty), not 86,957. In the example, at least half of the advance is marketing money controlled by the company and never paid to the artist. Because the company benefits most from marketing, shouldn't it pay its fair share? Why doesn't the producer share those costs as well?
Another test of fairness is who ends up with the money. It would be interesting to see the total income distribution to artists versus record companies. If record companies are really taking a risk, analysts should be able to find large variations in profit between companies and between years, attributable to whether the companies picked the right artists. Also, recording companies that take risks should sometimes fail. Is there any data along those lines that measures risk?
Roger Dannenberg
via e-mail
Authors Eric Leach and William Henslee reply: Roger — Your letter brings up several good points. Courtney Love's “diatribe” is quite interesting. An often overlooked fact concerning contracts is that they are completely voluntary. We recommend to any artist that if you can find a better deal regarding worldwide promotion, manufacturing, sales, and distribution of your music, by all means, take it. The problem is that new artists have almost no bargaining power. Established artists can, and do, negotiate much more favorable terms in their contracts.
To clarify our math “mistake”: the issue on point is the number of records, from a very simplified hypothetical standpoint, that a record company must sell to recoup its advance purely out of its profits. Technically, artist royalties are an expense, which actually reduces the profits rather than increases them. You are correct in your assertion that artist royalties are retained instead of distributed and subsequently recovered. Similarly, marketing arrangements can vary significantly from contract to contract; our hypothetical contract was meant only for broad reference.
Your “test of fairness” point is well taken. Although such hard data is not at hand, in the past several years, the failure or buyout of dozens of smaller record companies suggests that only large independently successful companies have the resources to bear such risks on a global scale and profit accordingly. It is true that, in any business, a company that has financial resources to draw from is much more likely to weather the profit-loss fluctuations of high-risk ventures.
TO USB OR NOT TO USB?
Reading your review of the Tascam US-428 (September 2001) reminded me of the glaring failure of EM and most other related industry publications to blow the whistle on the vain attempt of the USB standard to properly support MIDI. I recently read a column in another magazine that stated:
USB MIDI interfaces suffer from excessive jitter (timing “slop”);
the USB specification is at fault for that (the USB people did not talk to the MIDI people until some critical parts of the USB specification were already set in stone; therefore, timing issues could not be properly addressed);
the few devices that supposedly solved the problem used solutions that were applicable only to MIDI software from the same manufacturer;
older interface technologies (serial port, parallel port, ISA card, internal sound hardware, and so on) have much better timing stability.
I know of at least one USB device that can also be used with the old serial port instead. Used with the serial port, timing is okay.
Silence fell across the pro-audio publishing community in the wake of the column. Every maker of MIDI interfaces seemed to hop on the USB bandwagon. Clearly, a lot of money is at stake. Those manufacturers advertise, and I suspect some strong-arming is going on.
Like other USB devices with MIDI capability, the US-428 cannot be relied on to provide the MIDI timing stability required for professional use. I am sure that in all other respects it is a quality product, but the review should have warned readers about using the unit's MIDI ports if tight performance timing is important. I am less concerned with taking Tascam to task than with the failure of the publishing community to look out for the interests of its readers.
USB is okay for some things (audio, mice, keyboards) but isn't suitable for MIDI. The sooner people give USB MIDI hardware a decent burial, the better!
Cary Cornett
via e-mail
Cary — Your letter raises important issues that need clarification, so I contacted several industry leaders for comment.
Tom White, president and CEO of the MIDI Manufacturers Association (MMA; the organization responsible for setting standards related to MIDI), stated that “the silence Cary Cornett hears is not due to a conspiracy as much as to the fact that the industry does not have consensus on how to use USB for MIDI. There is more than one way to do MIDI over USB, and some methods are arguably better for timing accuracy than others.” White explained that the method designated by the USB Implementers Forum (USB-IF) was evaluated by the MMA, and “we found that the level of jitter varied considerably among systems with different configurations, making it difficult to make any absolute claims.” The MMA therefore declined to support the USB-IF MIDI Specification as currently written, but it “does not agree that USB MIDI does not work.”
It's important to remember that companies making USB MIDI devices often don't follow the USB-IF MIDI Specification and instead use time stamping and other methods to provide timing accuracy as good as or better than what is available through serial devices.
Jim Cooper at MOTU agreed with White's assessment, stating that trashing USB MIDI as a whole is like throwing the baby out with the bathwater. He said that MOTU took a hard look at USB before jumping in and decided that “for truly professional use, time stamping was the way to go, allowing us to achieve MIDI timing accuracy of 0.33 ms for every MIDI event — far better than serial MIDI.”
The quality of the device drivers is another important variable. As the technical staff at Tascam explained, “Most people who criticize USB as an audio tool do so on the presumption that the device's drivers are written according to the standard protocol, in which the device polls the USB bus on a regular interval, usually once every millisecond.” That may be fine for most computer peripherals, but audio devices are much more demanding. Tascam is quick to point out that “the US-428's drivers were created and specifically optimized for audio and MIDI performance” and greatly exceed the specifications for typical computer peripherals. Tascam states, “A well-written driver and a computer optimized for audio will much more heavily influence MIDI timing as opposed to the USB spec itself.”
In short, USB has the potential to deliver far greater performance than the old serial interfaces when used properly. Proprietary hardware and software combinations offer less flexibility than generic serial interface systems, but many users are more than willing to sacrifice some flexibility to achieve much greater performance and, in some cases, the cross-platform capabilities and convenience provided by USB.
— David Rubin
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