CMU Daily 06.07.21: Live industry welcomes likely return of full capacity shows later this month, AIM publishes insights on the artist growth model for streaming royalty distribution

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Live industry welcomes likely return of full capacity shows later this month
The live music sector has welcomed the news that full capacity shows will be able to return on 19 Jul in England as most remaining COVID restrictions lift on that day.

It was originally hoped that those rules would end on 21 Jun, of course, but they were kept in force because of concerns about the newer delta variant of the coronavirus. However, yesterday UK Prime Minister 'Boris' Johnson said that the plan now was very much to get rid of as many COVID rules as possible on 19 Jul, although a final confirmation of that is still pending until next Monday.

Some medical experts had cautioned against a complete lifting of regulations on 19 Jul given there has been another surge in COVID infections in recent weeks, and the removal of pretty much all the current rules relating to social distancing, face masks and home working will likely further escalate the spread of the virus.

However, because of the vaccination roll out, the current surge in infections has not resulted in a significant increase in hospitalisations - unlike during other surges - which is why the government is now more confident that the removal of the vast majority of existing COVID rules is a viable approach. It remains to be seen if that proves to be true.

But, for a live sector that has been pretty much unable to run commercially viable shows since March last year, the removal of social distancing in venues, and the reopening of clubs, is an incredibly welcome development. Plus, of course, in recent weeks the cultural industries have become increasingly frustrated that large gatherings for sporting events have become the norm again while venues and clubs remain in shutdown.

That said, while a date has now seemingly been set for a reboot of the live and night-time economies in England - future COVID surges, variants and lockdowns permitting - industry reps continue to call for more support from government, in particular state-backed cancellation insurance for larger scale events. Although the UK government has resisted calls for such insurance schemes previously, it has said it would consider that kind of support once most ongoing COVID restrictions have been lifted.

With all that in mind, the industry will continue to put pressure on ministers as it awaits final confirmation of the lifting of COVID rules next week and the return of full capacity shows the week after.

In the meantime, here are a lots of music industry people responding to yesterday's news...

Greg Parmley, CEO of LIVE: "The live music industry is very pleased with the Prime Minister’s statement, and it seems we will finally see a return to full capacity performances on 19 Jul. We have watched the rest of the economy reopen while our doors have been forced to remain closed since the start of the pandemic, but today’s announcements will generate considerable excitement amongst music fans across the country".

"To save the rest of the summer and autumn schedule we now desperately need a government-backed insurance scheme to provide the security required to invest in events. Government ministers have repeatedly said that a scheme would be announced once the legal barriers to full performances were removed. Well, we are now almost at that point and there must be no further delay if we are to reap the benefits of the superb vaccine roll-out".

Mark Davyd, CEO of the Music Venue Trust: "This is obviously extremely welcome news for millions of live music fans, for artists, crew, venues and local communities who have been deprived of music for so long. Since March 2020, Music Venue Trust's aim has been to reopen every venue safely. We have been working alongside the grassroots music venue sector throughout to identify methods by which we can do that, regardless of any current government guidelines and resulting limitations and restrictions. The keyword for us and the sector throughout these long difficult months has been 'safely'".

"This announcement is hugely important and provides the opportunity to revive live music. It does not, however, change the central mission or the importance of the word 'safely'. We are re-energising our efforts to work with our fantastic network of grassroots music venues to ensure that what each of them delivers to the public meets the highest standards of COVID security and safety within the new guidelines".

Phil Bowdery, Chairman of Concert Promoters Association: "I am delighted that the government has made the right choice today, letting the much-loved live music sector get back to doing what it does best. While we absolutely cannot wait to safely welcome back our fans, we are missing one piece of the puzzle – insurance. We need a government backed scheme to provide the security needed to start investing in events over the coming months, shoring up our industry and stimulating the wider economy as we build back following the pandemic".

Paul Reed, CEO at the Association Of Independent Festivals: "We welcome the Prime Minister's statement and that large events including festivals are expected to be able take place from 19 Jul. It is positive for organisers, fans and artists alike that there will be some activity this year, though clearly it is too late for the estimated 56% of UK festivals that have already been forced to cancel and are still awaiting details of emergency funding and the next round of the Culture Recovery Fund".

"We now urge government to finally act on insurance and announce a government-backed scheme immediately. Insurance remains the key obstacle to planning with confidence and there is no rationale for not implementing such a scheme if the government's roadmap is truly irreversible. We also need to ensure there is clear guidance for organisers and local authorities no later than 12 Jul, so that events don't unravel at a local level. We ask that government also explore solutions for staff that will be affected by test and trace and isolation policies working at events this summer".

David Keighley, Chair of the Production Services Association: "It's really good to hear from our Prime Minister that we can hopefully and finally get back to normal after the 19 Jul. The concert touring, festivals and events sector of our economy have been the hardest hit by COVID. We were the first to stop and we are only now being allowed to reopen. We must all be truly thankful for the vaccines as this is the reason we can almost get back to normal".

Michael Kill, CEO of the Night Time Industries Association: "We have been encouraged by much of what the Prime Minister said today about what government restrictions will look like in the next phase of reopening. The end of social distancing; the end of the rule of six and table service for indoor mixing; no ban on mass events; the removal of the need to scan a QR code to enter venues; and the decision not to introduce COVID status certification – these are all very important steps that we have been campaigning for, because they are the restrictions which have decimated the night time economy over the last sixteen months".

"We were disappointed again, despite the positive noises, that the Prime Minister did not confirm that reopening would be going ahead on the 19 Jul. As we commented at the time of the last decision on restrictions, one week is simply not enough time for businesses to plan to reopen – and it betrays the sense that the government doesn't understand what it takes to reopen a businesses after over a year without trading".

"To hear the Prime Minister say that we need to learn to live with this virus is a long overdue step, and will be a relief to our sector. It is difficult to overstate the significance of the impact the pandemic has had on this industry. The government’s support package has been important but insufficient. After 479 days closed, we now need that counter set to zero so we can start to rebuild".

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French government says stream-ripping can be covered by the private copy exception
Stream-ripping services have been the top piracy target of the music industry for several years now. However, the French government has thrown a bit of a spanner in the works by saying that the ripping of streams is entirely legal under the private copy exception of the country's copyright system. Well, sort of. Before you move to France to set up such an operation - or to start ripping all the music off YouTube - there are a number of conditions that need to be met in order to stay within the law.

Whenever a stream-ripping site has been targeted with legal action or sent a cease-and-desist letter by the record industry, the operator of that site has immediately exclaimed "but what we are doing is entirely legal!" Although shortly after that exclamation, most operators quietly close down their sites, not willing to test that argument in court. However, some have stood their ground and kept on allowing users to rip permanent copies of temporary streams on the basis that doing so is, well, "entirely legal".

There are two questions regarding whether or not stream-rippers are liable for copyright infringement. Firstly, are the websites that provide stream-ripping services liable by providing such services, even if they never actually store any unlicensed content on their servers? And second, is the user initiating the stream ripping process and downloading the resulting MP3 liable for copyright infringement, assuming they don't own the track being ripped or have permission from whoever does?

Most attention tends to fall on the former question, given it's the stream-ripping sites that tend to be targeted with threats of legal action. Does simply facilitating a stream rip constitute a 'communication to the public' under copyright law? Or could the website be liable for authorising or contributory infringement by encouraging and helping the user to download a file without licence? Although for the stream-ripping site to be liable for authorising or contributory infringement, the user would definitely have to be liable for direct infringement by creating and downloading the ripped file.

Anyway, where these questions have been asked in court - either as a result of litigation against stream-ripping sites or when the music industry seeks web-blocking injunctions against such sites - it's generally been decided that there is some copyright infringement going on, and there is some liability on the part of the stream-ripping platforms.

However, the French Ministry Of Culture has possibly fudged things a little when responding to Philippe Latombe, a member of the French National Assembly, who asked the government department whether or not stream-ripping was illegal.

According to Torrentfreak, the ministry's answer was "not necessarily". Why? Well, because stream-ripping might fall under the private copy exception that exists in most copyright systems, whereby people can make private copies of recordings without the copyright owner's permission. That said, there are some key requirements to meet for that to be the case.

"[Stream-ripping] is legal and the resulting copy falls under the exception for private copying as provided by law if several conditions are met", the ministry said. "It must be made from a lawful source at the request of the user, without being stored by the converter, and no circumvention of technical protection measures must be carried out".

The latter of those points is particularly interesting, not least because it's arguably the condition that unfudges the French fudge, in that the music industry would argue that most stream-ripping sites are definitely seeking to the circumvent technical measures employed by streaming platforms, especially YouTube, to stop stream-ripping from occurring.

Although one stream-ripping site, Yout, is currently disputing that interpretation of the service it offers through the US courts. Yout is actually suing the record industry - rather than the other way around - accusing the Recording Industry Association Of America of damaging its business by seeking to get it de-listed from the Google search engine on copyright grounds.

When seeking to get Yout removed from Google, the RIAA argued that the stream-ripping site circumvents "YouTube’s rolling cipher, a technical protection measure, that protects our members' works on YouTube from unauthorised copying [and] downloading". And that, the trade group added, violated the US Digital Millennium Copyright Act.

However, in its lawsuit against the RIAA, the stream-ripping operator said: "Contrary to defendants' allegations, Yout's software platform is not designed to descramble, decrypt, avoid, bypass, remove, deactivate, or impair the YouTube rolling cypher technology. In fact, any digital mechanism in place designed as anti-circumvention technology stops Yout users from recording and saving that protected work, thereby demonstrating Yout's compliance with any anti-circumvention protections in place".

So who knows? Of course, how the private copy exception works differs greatly from country to country - and the exception doesn't exist at all under UK copyright law. So, the French fudge would only work in France anyway. But still, it's a development that makes it all the more important for the RIAA to convince the courts that Yout is circumventing technical protection measures when facilitating any YouTube ripping.

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Brazilian trade group says it's taken down more than 65 stream manipulation services
Brazilian record industry trade group Pro-Música Brasil has announced that its work with the country’s anti-piracy body APDIF, cyber-crime policing unit Cyber Gaeco and the International Federation Of The Phonographic Industry to tackle stream manipulation has now resulted in more than 65 such services going offline.

Although stream manipulation - where companies create artificial plays for tracks on the streaming services - is an issue worldwide, it's been a much bigger talking point in certain countries, including Germany and Brazil. In both those countries, local trade groups have been targeting companies that provide stream manipulation services with some nifty legal action and some good old cease-and-desist letters.

Pro-Música Brasil announced last October that - as a result of its efforts - a number of stream manipulation service providers had shut down, or at least taken stream manipulation off the menu of services they offer. Subsequent action means that more than 65 sources of such services have now gone offline.

The trade group says that includes ten websites that have closed down entirely and 20 that removed stream manipulation as a service, plus 35 listings offering dodgy stream stat tactics have been removed from the online marketplace Mercado Livre.

Says Pro-Música Brasil Director Paulo Rosa: "We successfully closed fourteen streaming manipulation services in Brazil last year, based on criminal prosecution and cease and desist notices. Since then, we have been working hard with our industry partners to tackle other prominent sites offering streaming manipulation services".

Meanwhile IFPI chief Frances Moore adds: "Streaming manipulation has no place in music; we continue to tackle it globally. Pro-Música Brasil, APDIF and Cyber Gaeco have achieved a fantastic result, which supports the continued growth and development of Brazil's thriving legitimate digital music market".

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AIM publishes insights on the artist growth model for streaming royalty distribution
The UK's Association Of Independent Music has published the findings of research it commissioned exploring the so called artist growth model for the distribution of streaming royalties.

AIM first proposed the model in a submission to the UK Parliament's inquiry into the economics of streaming, which has focused a great deal on the various aspects of the digital pie debate. Which is to say, the debate over how monies generated by streaming subscriptions each month should be shared out between all the stakeholders in the music community, including artists, musicians, songwriters, record labels, music publishers and the streaming services themselves.

With streaming services of the Spotify variety, there are three stages via which artists are paid their digital royalties.

First of all, track allocation. All the money a streaming service makes through selling subscriptions (or advertising) each month needs to be allocated to the music that has been streamed. That is currently done on a pro rata model for each subscription type. So, if your track accounts for 0.1% of all listening by UK premium subscribers in any one month, your track is allocated 0.1% of all the subscription monies paid by UK premium subscribers in that month.

Second, revenue share. The money allocated to each track needs to be shared out between whoever controls the recording rights (either a label or a distributor), whoever controls the separate song rights (either a music publisher or a collecting society), and the streaming service itself. Revenue share arrangements are different in every individual licensing deal, but 50-55% is usually paid through to the recording rights and 10-15% to the song rights, with the service retaining 30-35%.

And third, artist royalty. Of the monies paid though to the recording rights - ie to a label or distributor - a cut of that income is passed on to the main artist who appears on the track. What cut the artist gets is entirely dependent on the deal they agreed with the label or distributor. It could be anywhere between a few percent and 100% of what the label or distributor receives.

There are debates about what happens at each stage in this process.

At stage three, there are debates over what is a fair share for the artist, especially if the artist signed a record deal in the pre-digital age so that their contract doesn't actually set out a specific rate for streams. There are also issues around the label being able to make additional deductions; artists still paying off advances and other recoupable costs the label incurred; and the lack of transparency around how an artist's royalty is being calculated.

Some argue that a solution to those issues would be for artists to receive at least some of their cut of the streaming money through the collective licensing system as 'performer equitable remuneration'. Then there could be industry standard rates and specific contract terms would be irrelevant.

At stage two, the big debate is whether the current revenue share splits are fine, and in particular whether it is fair that a significantly bigger share is allocated to the recording rights compared to the song rights. Most songwriters argue it is not.

And then, at stage one, there is the debate over whether the track allocation process should actually be done across each subscription type, given that that system means that some of the money put in by subscribers who listen to less music each month is being allocated to tracks played by subscribers who listen to more music.

The most commonly proposed alternative would see the allocation process done for each individual subscriber - aka a user-centric approach - even though that would mean the average per-play allocation would be different for high level streamers versus low-level streamers.

The artist growth model would also change what happens at the track allocation stage. Basically, monies would still be allocated to tracks based on what percentage of overall listening they accounted for, however, an extra metric would be applied.

The result would be that those tracks with the highest percentages would make slightly less per stream, while those with lower percentages would make slightly more.

One of the arguments in favour of user-centric royalty distribution is that it would result in top level artists making slightly less and middle level artists making slightly more. However - while that would probably be a general trend of user-centric - that outcome is not guaranteed. The artist growth model by definition redistributes money from the most played artists down to the less played artists.

AIM commissioned former Spotify and PRS economist Will Page and collective licensing expert David Safir to model what might happen if the artist growth model was applied, and last week they presented their findings as part of a panel discussion organised by the trade body. Those findings can now be downloaded from AIM's website alongside a recording of last week's event.

Commenting on the model, AIM says: "With 80% of streaming revenues going to just the top one percent under current 'pro-rata' streaming distribution models, the artist growth model seeks to counter this 'winner takes all' situation, distributing earnings more evenly in the market and enabling an increased number of credible niche and emerging artists to make a sustainable living from streaming".

It also notes Page's comparison between the artist growth model and the taxation system, in which you "tax the very rich to help the less rich, and leave everyone else unchanged".

Page and Safir applied one specific version of the artist growth model - which is to say a specific set of rules regarding what is taken off the top and how that is redistributed - to real world streaming data for one month in the UK. In that time period, with that set of rules, the indie sector at large and Universal Music would have seen an increase in payments had the artist growth model been in force, whereas Sony Music and Warner Music would have seen a dip.

The artist growth model wouldn't change the way revenue is shared at stage two nor what royalties artists receive at stage three, and it could also co-exist with a user-centric approach at stage one. Though advocates of the model argue that if it successfully provided a boost to middle-level artists, it might lessen the need for the some of the other proposed reforms.

You can access last week's discussion, and download the findings of Page and Safir's research, on the AIM website here.

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Britney Spears' longtime manager resigns
Britney Spears' longtime manager Larry Rudolph has resigned, amid increased calls for the singer to be released from the conservatorship she has been bound by for the last thirteen years.

According to Deadline, Rudolph - who has managed Spears since the mid-90s, with just a couple of breaks along the way - wrote to the musician's co-conservators Jamie Spears and Jodi Montgomery yesterday.

In his letter, he says that it had been some time since he had last spoken to Britney, but he now feels that his "professional services are no longer needed" as he understands that she intends to retire from music.

"It has been over two and a half years since Britney and I last communicated, at which time she informed me she wanted to take an indefinite work hiatus", he writes. "Earlier today, I became aware that Britney had been voicing her intention to officially retire".

"As you know, I have never been a part of the conservatorship nor its operations, so I am not privy to many of these details", he goes on. "I was originally hired at Britney's request to help manage and assist her with her career. And as her manager, I believe it is in Britney's best interest for me to resign from her team as my professional services are no longer needed".

He says that he is "incredibly proud of what we accomplished over our 25 years together" and adds that he will "be there for her if she ever needs me again, just as I always have been".

As Rudolph says, Spears has been on hiatus since 2019, when she cancelled a Las Vegas residency. That came after her father was hospitalised with a ruptured colon, which led to him withdrawing from his role as conservator temporarily.

Last month, of course, Spears said in a court statement that she wishes her conservatorship to come to an end, saying that she believes the arrangement to be "abusive".

She also said then that she wants to take time away from public life in order to get married and have another child, which she says she is prohibited from doing under the conservatorship. Rudolph's letter is the first suggestion that she intends to retire from music entirely.

Although she has insists that she wants the conservatorship to end, Spears has not yet officially filed a petition with the court in order to begin that process.

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UB40 announce Kioko's Matt Doyle as new vocalist
UB40 have announced Kioko's Matt Doyle as their new vocalist, following the departure of Duncan Campbell last week.

A fellow Birmingham musician, Doyle has previously supported UB40 with Kioko, and he also provided lead vocals on the song 'You Don't Call Anymore' on the band's new collaborations album 'Bigga Biggariddum', which was released last month.

"Matt has already demonstrated his ability and compatibility with the band on our latest album 'Bigga Baggariddim' with the track 'You Don't Call Anymore'", says UB40 guitarist Robin Campbell. "He's a talented young man with a voice and singing style that will prove to be a good fit and a great asset to the band. And on top of all that he’s a nice guy, too".

Doyle adds: "I don't quite know how to put into words just how incredibly honoured and grateful I feel to be given this opportunity. I have loved UB40's music for as long as I can remember and that love has only grown since getting to know them and watching them play live night after night on tour".

"They took Kioko under their wing and gave us the opportunity of a lifetime by inviting us out on tour", he goes on, "and although I'll deeply miss playing shows with Kioko I know that they will carry on to do incredible things and that we will always remain the best of mates".

Duncan Campbell took time away from the band last year after he had a stroke. He had been expected to return for the band's next round of touring, but announced his retirement in June following a seizure.

Meanwhile the group's original vocalist, Ali Campbell, now performs separately from the main UB40 outfit, usually under the name UB40 Featuring Ali Campbell & Astro.

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Dave announces second album, We're All Alone In This Together
Dave has announced that he will release his second album, titled 'We're All Alone In This Together', later this month.

It's the follow-up to 2019's Mercury and BRITs Album Of The Year-winning 'Psychodrama', and news of the imminent release follows the surprise arrival of two new tracks from the rapper - 'Titanium' and 'Mercury' - back in April.

Last week he also teased a new collaboration with Stormzy, which is due to arrive this Friday.

Set for release on 23 Jul, the new album is available to pre-order in several bundles now, with various combinations of cassettes, CDs and t-shirts.

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A Tribe Called Quest deny involvement in recent royalty share NFT sale
It's official. Staging a musical NFT drop is no longer the cool, buzzy thing to do. Denying you're involved in a musical NFT drop, that's what all the cool dudes are doing. It all began with Damon Dash, denying that he tried to sell a Jay-Z copyright as a non-fungible token. And now it's A Tribe Called Quest in denial mode.

Last month Royalty Exchange ran an NFT auction putting up for sale a royalty share right linked to the catalogue of the legendary hip hop outfit. The lucky buyer would get themselves a 1.5% royalty share on the group's first five studio albums.

Royalty Exchange has facilitated many such transactions over the years - the transfer of royalty rights being its core business - though it recently jumped onto the NFT bandwagon because, well, who doesn't love the NFT bandwagon? Doing so also ensured lots of media coverage for the A Tribe Called Quest royalty share sale, to the effect of "hip hop legends do the NFT thing".

But, the group's Ali Shaheed Muhammad would like you all to know, no hip hop legends did the NFT thing. Well, no A Tribe Called Quest legends, anyway. Because the 1.5% royalty share being sold via the NFT auction didn't belong to the group. It was, instead, a royalty share negotiated by the company of a former advisor to A Tribe Called Quest back in the day. Seemingly unbeknownst to members of the group.

That advisor was Ed Chalpin and the company is PPX Enterprises. According to a social media post by Muhammad, Chalpin helped negotiate A Tribe Called Quest's first record deal with Jive Records in 1989. However, they subsequently fell out with Chalpin when they discovered that their record contract with Jive included a clause that saw PPX get a share of monies with each new album they recorded for the label.

Costly legal wranglings followed and, Muhammad claims, ultimately Jive offered to sort everything out if the group agreed to deliver an extra album to the label. The settlement reached between Jive and PPX seemingly included an ongoing royalty share for the latter, which is what was presumably sold via the Royalty Exchange auction. Although, it seems, that royalty share was news to Muhammad.

It wasn't until he read a Billboard article on the NFT sale, he writes, "that I learned PPX Enterprises wasn’t entirely out of our business. Apparently PPX sold their share of a settlement they made with Jive Records to an individual whom entered into a partnership with Royalty Exchange. Be clear that is the NFT that was created and auctioned. Had we known this percentage of our art was out there we would have bought it directly from PPX Enterprises as it should have never been sold by Jive Records".

So there you go. Anyone else want to distance themselves from an NFT sale?

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