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“End the NDA cult”, managers tell the labels

By CMU Editorial | Published on Thursday 16 October 2014

The relationship between artists and labels is in flux, we know that. And whereas there was once talk of artists cutting the big bad labels out of their business affairs entirely, in most cases, especially with new talent, labels are now actually involved in more elements of an act’s career. There are plenty of opportunities in these new style artist/label alliances, though trust issues remain, not least because of the secrecy that surrounds the deals rights owners are doing with the digital service providers.

Providing clarity on those digital deals, says CMU Business Editor Chris Cooke in the latest CMU Digest Report, is the single biggest thing the labels could do to placate artists in 2014. Cooke writes: “As CMU’s survey of the UK artist community earlier this year proved, while some high profile popstars are outwardly hostile to the rise of streaming music and some of the key players in the market, most music-makers think streaming is the future, and while that’s probably fine, they are just really, really confused about how royalties are paid. Their managers may know a little more, though much confusion remains across the board. And where there’s confusion in the music industry, artists and managers will assume something dodgy is going on”.

Volker May, Vice Chair of the International Music Managers Forum, agrees. Indeed his organisation published a short paper at the recent Reeperbahn conference on this very issue, in particular seeking clarity on the kickbacks and equity the labels enjoy when signing up with new digital services. The IMMF’s statement following the indie label community’s recent Fair Deal Declaration, which pledged more clarity on digital issues, and which was a welcome development for May, though he wants to see labels make good on that promise.

He told CMU: “We like labels, indie and major. There are a lot of good people at labels, and a lot of resources are invested by labels in artists. [But we need] to draw attention to the fact that transparency failures are failures of action not of sentiment. Broad statements of good intentions are only valuable if backed up with actions, otherwise they are meaningless. We haven’t issued a declaration of what we think should be done with the [label’s] side payments and equity deals, we are simply asking for the artists’ partners at labels and at publishers to respond by acting to bring transparency on specific issues”.

Labels and DSPs are prone to shout ‘NDA’ whenever asked about the nitty gritty of the label/digital deals, and ending the non-disclosure agreement obsession that has dominated most of the big digital agreements in recent years is one of the artist and management community’s top priorities.

Says May: “Regardless of who started the NDA cult, the artist signs a deal with the labels and the publishers. A starting point would be for them to recognise the trust and commitment made by artists, and to reciprocate. Not to point across the table at the services as a problem that somehow prevents us equitably dividing the money on our side. Lets deal collectively with the value of music as an industry, lets go and get more money, but first lets agree that the value will be shared, and what sharing actually involves”.

The latest edition of the CMU Digest Report also considers copyright ownership data challenges, how copyright could be better communicated and Google’s role in combating piracy. There’s also an interview with the founder of innovative new ticketing app Dice.fm. You can download the PDF report for £9.99 from the CMU Shop.

CMU Digest subscribers received a link to download their copies in last week’s weekly email bulletin. To receive twelve copies of the Report plus a weekly news digest and other benefits for just £50 a year, become a CMU Digest subscriber by clicking here.