The Music Industry Business: Regulations And Control

The music business is largely a self-regulated industry. Everyone seems to be involved in some aspect of control: individual artists, unions, corporate giants, publishers, etc....

The music business is largely a self-regulated industry - everyone seems to be involved in some aspect of control, from individual artists to unions and corporate giants, from publishers to licensers, from collecting agencies such as ASCAP, BMI and others to copyright and trademark offices.

Firstly, the U.S. Patent & Trademark Office must have an example of a band's name and / or logo registered before any band can claim rights in that name. The Office regulates who can have what name and symbol, and under what circumstances likenesses to similar preexisting band or entertainment names might be allowed. Any group who performs, records, or sells their music for commercial gain would be wise to register their name in order to defend their rights to continue making a profit from that music.

Rarely, an individual artist will have enough power (money) or popularity to be able to make their own career and contractual decisions, usually because they own their own publishing company, merchandising, or even their own record company (i.e.: Madonna's Maverick Records, or Nine Inch Nails' Nothing Records). However, most artists cannot afford, or do not have the contacts necessary, to run their own publishing company, and as a result about 50% of their profits are paid out for the right to publish their music. When certain publishers own the artists rights to a song, they can prevent further performances or inclusion of those songs on future albums, should the artist ever change publishing companies; or, they can prevent other bands from recording a cover of those songs, sometimes even if the original band has given their ok.

Additionally, artists who wish to gather royalties on their music broadcasts must join ASCAP, BMI, SESAC or some similar group who can obtain BDS (Broadcast Data Systems) information on how many times a song was played and award the artist accordingly. The first two are non-profit organizations: ASCAP allows a performing musician to register by paying dues, while prospective members of BMI must prove that they can become an "affiliate" (provide for their own financial needs). SESAC is a for-profit organization that doesn't seem to have much benefit for a "new" artist, mostly because they pay out expected royalties up front; only the already big names would enjoy this system if their previous song went over very well, and the expected return on the new song is to be as high (that way, if it does not do as well commercially, the artist comes out on top with a substantial chunk of change, but their next payout will probably be low if they use SESAC again).

If a group wishes to cover a previous song for commercial gain they must secure a copyright license from the Harry Fox Agency for any or all of the following reasons:

· "Licensing of copyrighted musical compositions for use on commercial records, tapes, CDs and computer chips to be distributed to the public for private use.

· Worldwide licensing of copyrighted musical compositions for use in audio/visual works including motion pictures, broadcast and cable television programs, CD videos and home videograms.

· Licensing for use in TV and radio commercial advertising.

· Licensing of musical compositions in recordings for other than private use, such as background music, in-flight music, computer chips, syndicated radio services, MIDI, karaoke and multi-media.

· Licensing of musical compositions in recordings made outside of the U.S. and imported into this country for sale.

· Collection and distribution of royalties derived from the uses of copyrighted musical compositions pursuant to the licenses issued.

· Auditing of the books and records of licensees utilizing copyrighted musical compositions pursuant to the licenses issued, as well as the identification of unlicensed product."

With the publishers holding publishing rights, ASCAP, BMI, or SESAC holding performance rights, and the HFA holding mechanical rights for reproduction and distribution, artists can be fairly sure that no one else is profiting from their work without prior clearance. Record companies, on the other hand, can join the RIAA (Recording Industry Association of America) in order to further protect their rights in their artists' music. The RIAA's mission statement tells us that they "work to protect intellectual property rights worldwide and the First Amendment rights of artists; conduct consumer, industry and technical research; and monitor and review - - state and federal laws, regulations and policies." Essentially what this means is suing (or ordering other court punishments such as injunction, impounding, destruction, or damages) anyone who produces unofficial copies of music for commercial (and sometimes non-commercial - as seen in the lawsuits against napster, mp3.com, and other internet sites--) gain.

Further, anyone who wishes to play music from a jukebox in a public setting must get clearance from the AMOA (Amusement and Music Operators Association). They provide licensing to businesses using jukeboxes by having the proprietors pay dues, much like ASCAP, so that royalties will be paid to the record companies whose artists have been selected to be played.

Unions such as the AFM, AEA, and AFTRA also help to regulate the music industry by protecting musicians who perform in orchestras or theatrical venues, and also road crews of touring musicians. The provide assurances of quality pay for their work, and pay out more to persons who perform extra tasks such as carting gear, or doubling instruments.

Many music business books tell us that all musicians will find themselves in court, or in need of an attorney for some reason in the span of their musical careers so, naturally, the U.S. Judicial System has the final say in any and all regulation of the music business, from copyright infringement to trademark and ownership disputes, and the appropriate punishments to be dealt to said offenders.

All in all, even though the artist seems to be on the downside, the music business has several built in agencies to take care of both individual artists and the corporate giants who often own their works in whole or in part. However, with more and more artists choosing to take control of their careers by turning to self-publishing on the internet, one can only wonder what agencies will arise to fill the need for internet regulation. ASCAP has already taken a step in the right direction by licensing MP3s; will there be more?

© High Speed Ventures 2011