Music Business/Law Tips - "Streaming"

The 2 best known sources for streaming music in the US are Pandora and Spotify. Pandora is what is known as a “non-interactive” platform because its sort of like a traditional radio station where the listener has no real control over what is played (other than fixing genres/similar artists that cause a narrowcast). Spotify is known as an “interactive” platform because the listener gets to choose what they listen to (click). While streaming of music is great for the discovery of new music/artists, currently it does not pay out much in royalties to the performers/songwriters. Although it’s hard to say for sure, approximately 140 streams equal what is earned from 1 digital download sale on iTunes. Due to the explosion of cellphones, iPads, etc. (worldwide) where music can be listened to from anywhere via this platform, it will only get to be bigger. We will have to stay tuned to see how the money trickles down to the creators as this new model evolves. Ben McLane Esq Benmclane.com

Music Business/Law Tips - "Business Forms"

Artists and entertainment companies have several options to consider when deciding the best type of business to form. The most common business entity forms are as follows: Sole Proprietorship, Partnership, LLC and Corporation. Factors such as liability, complexity and taxes are considerations. 1. Sole Proprietorship: This is normally for a one person company. Its also known as a DBA. This is the least complex, but there is more potential liability. 2. Partnership: This is for 2 or more co-owners. Its also not very complex, but each partner is subject to liability. 3. LLC: This is for 1 or more more owners, and is sort of a hybrid of a partnership, but there is a liability shield for members. 4. Inc: This is for 1 or more owners, and is more complex than an LLC to operate, but there is a liability shield. Most large companies seem to be corporations. The tax ramifications of each is beyond the scope of this article and its suggested one speaks to an accountant before making any decisions. Ben McLane Esq benmclane.com

Music Business/Law Tip - "Record Release Set Up"

For an indie artist to maximize their chance of success from a record (album, EP or single) release they should do the following: 1. Have the music available on all digital retail outlets/e-commerce sites (i.e., iTunes, Amazon, etc.). This can be done easily via signing up with a distributor such as TuneCore, CDBaby, Orchard or MondoTunes. 2. Have the music available on the main Streaming services, such as Spotify and/or Deezer. 3. Have a Press campaign in effect (via a PR agent or yourself) whereby the music is being serviced to the tastemaker blogs that support your style of music so it gets reviewed, and a viral buzz can start. 4. Have at least 1 video up on YouTube to support the record. 5. Make sure there is a tour or shows performed to help promote the release. 6. All of the above needs to be coordinated to happen simultaneously. Ben McLane Esq benmclane.com

Music Business/Law Tips - "Online Performance Income"

There is positive news to report to songwriters. Even though record sales are down, because of new technology BMI, ASCAP and SESAC can now much better monitor/track, process and pay-out on performances of songs on the Internet, steaming audio, video, and other digital platforms and new media that are constantly emerging. According to a recent Billboard article, ASCAP reported that last year it had tracked 250 billion performances, many of which were from the digital world. Bottom line, that is new money that is coming to songwriters that did not exist a few years ago. Hence, from what might seem like just a small stream now may someday become a roaring river of new income. Ben McLane Esq benmclane.com

Music Business/Law Tips - "Website Tips"

Here are the 3 key things an artist should keep in mind for his/her website: 1. Create a functional/attractive home page, which should contain easy to see/find links to the following basic elements: music, video, shows, contact info, a buy button for merch/music. 2. Make the website the "artist hub" and point back all the other social networking sites (i.e., Facebook, Twitter, etc.) to the website. 3. Update the website frequently with new content to maintain fan interest and interaction. Ben McLane Esq benmclane.com

Music Business/Law Tips - "Fans"

Its elementary that an artist cannot sell his/her music, tickets or merchandise if there is no audience to sell them to. To find out if an artist really has a dedicated fanbase (i.e., a career), the following 3 key factors have to exist: 1. The fan(s) buy an artist's products. 2. The fan(s) make repeat purchases of an artist's products. 3. The fan(s) recommend the artist's product(s) to their friends online and offline (i.e., viral). Ben McLane Esq benmclane.com

Music Business/Law Tips - "Record Company Profit"

Record companies have a choice when they release a record as to what configurations they will create for the market. Those decisions are generally based on cost, profit and demand. The 3 main configurations are (1) CD, (2) digital download, and (3) vinyl. CD album: Wholesales for approximately $8.29. Manufacturing cost is approximately $1.15. Label gross profit is approximately $7.14. Vinyl album: Wholesales for approximately $10.50. Manufacturing cost is approximately $3.50. Unsold stock cannot be returned so have to be careful on units produced. Label gross profit is approximately $7. Digital album: Wholesales for approximately $6.99. Manufacturing cost is $0. No shipping costs. Label gross profit is approximately $6.99. Although vinyl has had a resurgence, since it costs the most to make and sells the least, it is a limited market, with digital sales becoming the dominant trend since there are no costs to produce and there are now fewer stores to sell CDs. Ben McLane Esq Benmclane.com