Felix Kellaway

BA Music Year 2 Music Industry The Survivors Guide

Music Industry - The Survivors Guide

The words that follow are aimed to give analysis of the music industry to an ill informed musician. I will discuss relevant details of being self employed, the Performing Right Society (PRS), Mechanical Copyright Protection Society (MCPS), Phonographic Performance Ltd (PPL), as well as societies such as the Musicians Union (MU) and the Incorporated Society of Musicians (ISM).

Being Self Employed

As a working musician in the industry today it is important to be in control of your incomings, outgoings and overall financial status. In order to be able to cater for a portfolio career, knowledge of how to be self employed

is a realistic requirement. After three months of being actively self employed, you must inform the HM Revenue and Customs (HMRC) and register as self employed. By doing this, you are informing the HMRC of how much you are earning and so how much tax you should be paying, which is a legal requirement. You will pay Class 2 National Insurance, Class 4 National Insurance and Income Tax. By filling in a tax return to communicate your earnings, HMRC will calculate your tax/Class 4 National insurance. When registering as being self employed you will need to submit some basic information such contact details etc as well as the nature of business you want to start. You will then be allocated a Unique Tax Reference, which must be quoted in all documentation from then on. At the end of each tax year, which runs from the 6th April to the 5th April the following year, you will be given any tax return you are due. Organised documentation of any expenditure is therefore crucial when self employed so that when it comes to filling in your tax return you have the evidence which is needed to claim back on paid tax. The tax you pay will be calculated on the profit your business makes and so any proved expenditure will mean you are taxed less. To register with the HM Revenue and Customs you should do one of the following: % % Visit www.hmrc.gov.uk/selfempolyed

Fill out a form which is available online from www.hmrc.gov.uk/leaflets/se1 Telephone 0845 9154 515

Copyright & Intellectual Property Intellectual property is a commercial or artistic invention. It is split into two sections, Patents/Trademarks; this protects industrial property and Copyright, which protects artistic/literary works. The copyright law in this country is covered by the Copyright Designs and Patents Act 1988. Copyright belongs to the writer (composer, author or songwriter) and not the musician performing it. It enables the creator to assert rights over their work from the moment the piece of music or writing is created. For copyright to be valid it must abide to each of the following: % % It must be an original idea It should be in a tangible form, such as a score or a recording

It must be sufficient enough to qualify as a work and that skill and effort has been put into it. For example you could not copyright a single chord sequence or melodic line alone. You should be able to provide proof of ownership

% 1. 2.

To verify your rights and be able to have proof of the creation and ownership you 3. should do at least one of the following: 4. % Send it to yourself in a sealed envelope. The envelope should have a dated stamp it and you should not open the envelope for anything other than any legal disputes. % Register it with a lawyer, although this could be quite an expensive option. Register with the International Property Rights Office: www.iprightsoffice.org Register it with the PRS or MCPS

Musical copyright lasts for 70 years from the end of the calendar year from when the creator dies. The copyright for sound recordings and broadcast only lasts for 50 years after the calendar year it was first released. For more information on copyright and intellectual property visit: www.copyrightservice.co.uk Copyright Infringement in the Media On January 15th 1971, George Harrison released his first solo single My Sweet Lord and it went number one in the charts on both sides of the Atlantic. Then a month later on February 10th Blue Tunes record label filed a law suit against Harrison and his record label Apple for My Sweet Lord, claiming that it had been stolen from Hes So Fine released by The Chiffons a decade earlier. An out of court settlement was approached, including an offer of $148,000.00, but Blue Tunes records wanted 75% of the royalties and the surrendering of copyright for My Sweet Lord. The case was waiting to be heard in court until 1976, when the judge found that the songs only displayed minor differences and that Harrison was guilty of subconscious plagiarism and fined $587,000.00.

Performers & Composers

As an active musician, you are entitled to certain rights with regards to royalty payments, duplication, and ownership of your work. There have been societies set up to help with these issues. Royalties Royalties are payments to the holder of a copyright of any asset or idea. In the music industry this will be either the writer or publisher. The payment of royalty is based on how many times the work has been used or played.

Performing Right Society (PRS) Bridging the gap between those who create music and those who wish to use music The PRS was founded in 1914 as a royalty collection society. Musicians that join the PRS are writers (composers and songwriters) and publishers. It is in the interest of a musician to join if their music is being broadcast on radio/TV, used online, in concert or otherwise performed in public. In order to create revenue and provide the royalty payments to its members, the PRS issues license fees. Any venue or establishment broadcasting copyright music for commercial use is eligible to pay an annual license fee. This covers anywhere outside of home, where music is played from night clubs to concert halls, from dentists waiting rooms to Dixons and from a plane to a pub jukebox. The owner or proprietor is usually responsible for obtaining a music license. With over 7 billion public performances made each year, it is extremely difficult to keep a count on what has been played where and how many times. To deal with this, PRS have an international team of market researchers that analyse and produce statistical data to measure what royalties should be paid to whom, and who should be paying a license fee that perhaps isnt. The percentage of royalties paid to the writer(s) and publisher is always in based on the initial publishing agreement. However PRS have an agreement to always credit the writer(s) with at least 50%. There is a one off 100 subscription fee to join the PRS, and it is highly advisable to join if you or a band is writing music. The PRS will ensure your rights as a composer and will potentially make you a lot more money from your work. To join the PRS visit: www.prsformusic.com

Mechanical Copyright Protection Society (MCPS) The MCPS represents its members every time a mechanical copy of their music is made. The music is normally duplicated by hardcopy such as CD or Vinyl, but also now through downloading, ringtones and use of samples. Every time a physical copy is made, the writer(s) and publisher are due a mechanical royalty due them owning the right to copy their work. MCPS distributes the royalties to its members collected from the licence fees they collect from those that want to make copies. You should consider joining the MCPS if youre a writer or a publisher and your music has been recorded, released by a record company (other than your own), used online or recorded into a TV or radio programme. Any musicians featuring on the track do not receive any royalties unless they are counted as one of the two previous titles. PRS and MCPS formed an alliance in 1997 and in 2009 the PRS for Music brand name was adopted. Although you must apply separately for membership and they there own legal entities, the two societies work together as an overall body to create a more powerful brand identity. For more information on joining visit: www.mcps-prs-alliance.co.uk Phonographic Performance Ltd. (PPL) The PPL generates revenue for its members by licensing the use of sound recordings of TV and radio broadcasts, public performance and sound recordings used in clubs, shops or restaurants etc. It is a legal necessary for all places where music is publicly performed or broadcast to obtain a license for the use of sound recordings. PPL represents tens of thousands of performers, record companies and the copyright holders of a vast majority of the music used in UK today. They distribute one license to the proprietors of each public performance space or broadcaster that allows them to play any music recordings they want to. Whether you are a featured artist or a session musician on a track, or if you hold the rights to any recording and any tracks that you have performed on and they are broadcast on the radio or played in public, you need to register with PPL to ensure you receive any airplay royalties that may be due to you. It is free to join PPL and as a rights holder, you are eligible to receive 50% for a performance of your work. It is worth noting that if your record company is not a member, then you will not receive anything, even if you yourself are a member as a performer. Upon becoming a member of PPL, you will be given a unique Performer Identification Number (PID). Whenever you take part in any recording session from then on, supply the record company with you PID and they will submit the details and

your role in the track to PPL to ensure your rights and fair payment. For more information on joining visit: www.ppluk.com PRS in the Media In March 2009 YouTube came under fire from the PRS over a royalties dispute. YouTube were accused of neglecting the influx of new music videos that was being uploaded onto their site and as a result, they were ignoring to allocate the correct royalties to musicians. YouTube then hit back by claiming that the PRS were issuing exorbitant new payment fees and ended up removing thousands of music videos from their site. The rift was put to rest when YouTube agreed to pay a flat rate fee that licenses over 10 million pieces of music to be played legally on their site. It was an important deal as it was the first agreement of its kind that ensures revenue to be collected for its songwriters and publishers from a video sharing site. The amount of revenue collected will be similar to radio and TV broadcasting where it is based on how many times a clip is played. Illegal Downloads There are over 7 million illegal file sharers in the UK today and according to a recent report from the BPI, it is costing the music industry 200m each year. In June 2009 the government carried out a Digital Britain report. The business secretary Lord Mandelson was backed by some of the major record companies such as Sony and EMI as well as artists such as Lily Allen and James Blunt in plans to disconnect users who persistently download files illegally. Dispute erupted within the music industry when the Featured Artists Collection (FAC), the British Academy of Songwriters, Composers and Authors (Basca) and the Music Producers Guild (MPG) joined forces to oppose these threats claiming that it would be an wide spread invasion upon the peoples privacy. Two months after the Digital Britain report, Peter Mandelson proposed a date for government intervention into illegal file sharing. By the summer of 2010, warning letters will be sent out, if illegal downloading has not dropped by 70% by April 2011 then soon after people may find their internet connection being cut off. Despite the strong opposition from unions and big name bands such as Blur and Pink Floyd, an agreement was signed on the 24th September 2009 backing Mandelsons proposals. In November 2009 the British Music Rights (BMR) conducted a survey looking at the consumption trends of 14 24 year olds. The report found that a staggering 63% of people download music over peer to peer websites. However it found that the majority of people still enjoy the tangible feel of owning a CD and that 80% of people would be interested in paying for a legal file sharing site. This then presents an opportunity for development within the music industry.

A solution to this problem and one that seems to be taking off at the moment is the introduction of legal music sites. Access based sites that take money at a point of entry offering a subscription where their customers have an unlimited download limit. Sites such as Spotify, the Monkey tariff from Orange and Nokias Comes with Music initiative allows users to stream there music for a reasonable fee. This coupled with the on the move convenience of music accessibility could spell the end for illegal downloading.

Societies
There are many different societies in the UK that exist to represent musicians. It is often a very good idea to join societies as many of their membership benefits cater for many of the needs that working musicians have. The main societies within the music industry are: Musicians Union (MU) The Musicians Union negotiates with all the major employers in the industry on behalf of their members and offers their services to all kinds of musicians from professionals to students. It is the biggest union in the UK representing musicians, with over 30,000 members. Some of the benefits include legal advice and support, special insurance schemes including health and pension schemes, help to ensure musicians get paid fairly, networking opportunities and public liability cover. Public Liability cover is an important one; it covers self employed musicians for any claims made against them. For example, if a pupil had a fall during a lesson in your house and broke a bone, your public liability insurance would cover any charges or claims made against you. Membership costs are: % % % 75 per year for students in full time education 155 per year if earning under 16,000 275 per year if earning above 16,000

For more information and to join, visit: www.musiciansunion.org.uk

Incorporated Body of Musicians (ISM) The ISM is a professional body for musicians, many of the benefits and credentials are similar to those of the MU. There aim is to promote professional music and their musicians, raise the standards within the industry and offer support, help and advice

to their members. It differs from the MU as its members tend to work primarily in the classical and concert field. The ISM has three different sections of membership, performers, composers and teachers, making it the choice for many musicians who are looking for more specific help or a smaller more intimate representational body. Membership costs are: % % % % 45 for students 50 for graduates of up to 3 years 62 for an associate membership 140 for a full membership

Associate membership is for amateur musicians and music enthusiasts. Perks of the membership include free information and publications as well as discounts and merchandise. For more information and to join, visit: www.ism.org

Networking The Music Industry is one which the term Its not what you know its who you know has a certain ring of truth to it. Meeting people and making contacts is one of the best ways of finding work. Building up a framework of people within the industry around you could be the difference from making a successful career and not. Below is a list of websites that offer online communities for musicians with forums, networking and job opportunities: % http://www.broadjam.com % http://www.myspace.com % http://www.dilettantemusic.com % http://www.sibeliusmusic.com

Conclusion To survive as a self employed musician in an industry that is constantly changing and evolving, its important to be as streetwise and acute to the industry workings as possible. With most musicians primary concerns being focused on music itself, it is

easy to ignore some of the more tedious aspects of the business such as documentation of expenses and the paying of tax. However if this is ignored you could end up having to pay over the odds for simple mistakes. Of course, the music should be of primary concern, but if youre landed with a catastrophic fine, it soon might be taken over by something that could easily be prevented. The information listed above should give you a good basis of knowledge and joining up to some of the societies and unions will help your development as a self employed musician. For more detailed information and analysis visit www.musicweek.com. Signing up to a website such as this gives weekly emails to keep you updated on the music industry and informs you of issues that could affect you as a musician.

Bibliography Passman, D.S (2004): All you need to know about the music business. Penguin Books, London Harrison, A (2005) Music: The Business The Essential Guide to Law and the Deals. Virgin Books, London. Krasilovsky, W & Shemel S (2003): The Business of Music - The Definitive Guide to the Music Industry. Billboard Books, New York. Wilson, L (2003) :The Copyright Guide. Allworth Press, New York.

Webography http://www.guardian.co.uk/technology/2009/oct/28/mandelson-dateblockingfilesharershttp://www.guardian.co.uk/music/musicblog/2008/jun/17/illegaldownloadsthesolution http://www.telegraph.co.uk/technology/6513919/Spotify-helps-curb-music-piracy.html http://www.copyrightservice.co.uk/ http://www.entertainment.howstuffworks.com/music-royalties.htm http://www.hmrc.gov.uk/ http://www.ism.org/home.php http://www.mcprs-prs-alliance.com http://www.musicweek.com/

http://www.musiciansunion.org.uk http://royaltyweek.com