Article: Music licensing model that the music industry needs



The ice is getting thinner

While a music awards show turned out to be a disaster, it proved to be a catalyst in the licensing of music. This is what the music industry needs for a business model to kick into place…

By Maheen Sabeeh

Pure and simple as a shepherd’s song

Music award shows don’t always validate talent but they remain a pop culture phenomenon and a necessary platform where excellence is recognized. Awards shows aren’t just about nominees and winners but also about the public getting an overview of what the music industry has accomplished in a given year. They also bring younger acts into focus along with the hip and in-season pop superstars. They show the mark musicians and entertainers have left on audiences, industry insiders and the media in a given year. Ultimately awards shows celebrate history that has been made.

The recently held MTV Brrr Awards fumbled on almost every count. From a bad case of mismanagement to a dead red carpet, the secret music jury, last minute additions to nominations, some bizarre wins, the lack of a media shebang, awful hosting, shoddy DAT performances, few live but badly sounding performances and an unusually high focus on international ‘stars’ (read: has-been British-Asian acts), it was a disappointment of epic proportions.

There was one silver lining to the show, though. The deal that was struck between Pakistan’s giant record label, Fire Records and a bunch of music channels that currently includes Aag, MTV Pakistan, Oxygen and Play. Talks with Oye are ongoing as this article goes into print.

The deal is the licensing of music. In simpler terms, it refers to the royalties that music channels will pay to the biggest record label, Fire Records, in Pakistan for playing its music content. It is an alliance of sorts and a necessary one, which may finally bring some form of legal laws into our slip shod music release mix.

If MTV Brrrr Awards did one thing right, it was the timing. They became the catalyst in an ongoing process – royalties for music – that finally took a leap to the next level.

When the nominations were released, MTV had sent letters (to indemnify them) to various musicians who were nominated and many of whom are tied to Fire Records. Musicians like Ali Zafar, Atif Aslam and Strings who were approached, while speaking with Instep, revealed that they did not sign these letters. Meanwhile Fire Records maintained that MTV needed permission to use their content in the awards show. At the eleventh hour, a deal was finally struck, thereby making the use of all content from Fire Records legal.

The show may be unforgettable for its sheer scale of disastrous mistakes but it propelled the issue of licensing into the forefront. Copyrights remain in shadows while everyone pickpockets. Music videos run on local airwaves for free while musicians and record labels remain in a crunch.

Music videos are content and the bill cannot be footed by (a) the musician alone without remuneration from channels as well as other media outlets such as radio channels (b) record labels who are investing in any artist by producing their video and (c) both. Investment is necessary for the music industry to create some form of a business model.

When did your heart go missing?

Is there skepticism? Absolutely. What about the musicians? The musicians will benefit from this deal too and it will propel the industry towards some semblance of structure. Artists often opt for upfront, lump sum deals with record labels because they are aware that copyright laws are neglected. A free ride is no longer an option. If channels pay, whatever the sum, it will eventually enable artists with more options. It will also give record labels an incentive to continue investing in not just established artists but upcoming talent too.

Ali Azmat is a man who must be mentioned. He remains the only artist with Fire Records who did not sell off his rights to the record label. As a result, he owns his songs. Ali opted for a royalty based deal and only gave distribution rights. He maintains it and so does Fire Records CEO Doctor Akbar Yezdani.
But a chuck of artists have, as Doctor Akbar Yezdani puts it, “We’ve purchased their rights and in exchange paid a lump sum.” Now the sum may vary from artist to artist, their market worth, star power, public demand among other factors but the gist remains the same.

Ergo, the long-term effect of licensing of music is one that is unique and historic in this day and age of piracy, lack of enforcement of copyright laws and the increasing need of a business model.

The music business is changing and artists and record labels around the world are looking at alternative mediums. A song can digitally be bought on i-Tunes for 99 cents. By 2010, the price will increase to 1.99 dollars per digital download. And yet, despite such high-tech digital age mediums, record labels haven’t become obsolete. Global economic recession means lesser investment in music throughout the world. Record labels still have a role to play.

In Pakistan, the level of digital music dependency and demand has not reached a level that is being witnessed in the American and British music markets. For Pakistan, these deals of royalties are even more important. Internet piracy of Pakistani music is rampant and accessible to all and sundry. Not only does it affect physical sales of CDs but it also makes it impossible for a record label to even enter the playing field.

The view remains that Fire Records has a monopoly. And right now, it does. Their artist list is massive which includes Ali Azmat, Ali Zafar, Atif Aslam, Strings, Shehzad Roy, Shafqat Amanat Ali Khan, Rahat Fateh Ali Khan, Zeb and Haniya and Laal. This is just from the top of my head.

Upcoming artists include Hadiqa Kiyani, Kaavish, Call, Mauj and Maryam Kizalbash among many others.
The bigger question is this: Will a monopoly work in the long run? No. After all, how many albums with full promotion can be released by a lone label in a given year? And that too in a country like Pakistan where political tension are always escalating. The stressful environment will reflect itself not just on the creative aspect of music but also on the economic front.

“We don’t want to be the only label in Pakistan. I hope that after this deal more record labels will enter the market,” says Dr Akbar Yezdani.

Currently there are a few other record labels operating in here, but they remain in the shadows. The clout belongs to Fire Records and the company is using it. When record labels realize that royalties are a possibility in Pakistan, they will invest in artistes and actively seek out new talent.

With channels and record labels forging a willing alliance, musicians can hold on to their rights and opt for royalty-based deals. It will also give room to other record labels to enter the game because the investment will not be one-sided. For the music industry, the licensing of music is very good news. It shows that a fool proof structure can come into place.

link: INSTEP Magzine

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