Claude Solnik, The Daily Record Newswire
"Ghostbusters" was a big movie for actors Bill Murray, Dan Aykroyd and the late Harold Ramis, and for singer Ray Parker Jr., who rocketed to stardom with the catchy title song.
It was also a huge deal for the Alessi brothers.
Three decades later, musicians Billy and Bobby Alessi still enjoy quarterly royalties for their song "Savin' the Day," which played in the 1984 blockbuster and on its official soundtrack album.
As younger generations ditch CDs for digital tracks, the world of royalties always the lifeblood of the music industry is being dramatically redefined. The way tunes are monetized has changed and will continue changing, and the turf wars over rights to music and lyrics can be massive and ugly.
Group mentality
Simply calculating royalties has always been a daunting task for musicians, managers and those who would play their tunes. An entire industry has formed expressly to monitor music-based royalties, and its parameters are defined to a large extent by 1998's Digital Millennium Copyright Act.
Basically, the copyright law criminalizes production and dissemination of technology, devices or services intended to circumvent copyrights, and criminalizes the act of circumventing a copyright-access control whether or not there's actual copyright infringement. In addition, the DMCA heightens penalties for online copyright infringement.
A constant barrage of amendments and lawsuits, however, continues to challenge the law. Since man started recording music, musicians and record labels have battled over how to divide the dollars, and with online streaming services now entering the picture, that doesn't appear likely to change anytime soon.
"Technology has created numerous revenue sources that never existed," noted Lewis Stark, a partner at Manhattan-based accounting giant EisnerAmper, which maintains Long Island operations in Syosset and often performs royalty audits. "You have all types of revenue channels."
In a digital world, just determining who's owed what can be a major undertaking, Stark added.
"There's a high volume of activity and a low amount of transactions," he said. "Royalty statements have become voluminous."
Since monitoring millions of songs is, to put it mildly, complex, middle men often cut deals for massive numbers of songs, as opposed to paying for the rights to play or resell individual cuts. Groups such as Broadcast Music Inc, the American Society of Composers, Authors and Publishers and SESAC (formerly the Society of European Stage Authors and Composers) charge for access to their catalogs and split the revenues among members.
"Radio stations are, if you want to use the term, taxed," noted Dave Widmer, market manager for Farmingdale-based Connoisseur Media Long Island. "We don't have a menu of music where we decide what to play. It's not like we say we'll play Elton John's 'Goodbye Yellow Brick Road' or the new Bruno Mars song and pay eight cents for that. We pay a flat fee based on radio station revenue."
Today's music industry is "very much about high volumes of data and systems to process that data," said Maurice Russell, senior vice president of client services at Harry Fox Agency, a Manhattan-based provider of rights management and collector and distributor of mechanical license fees on behalf of music publishers.
"We've been forced to become more technological," Russell noted.
Sour notes
In addition to the Digital Millennium Copyright Act, there are several royalty-focused laws designed to simplify matters.
Songs that wind up part of anthologies, for instance, often generate 9.1-cent payments for publishers holding the song rights; bars and supermarkets, meanwhile, are not legally allowed to rebroadcast radio broadcasts.
"That's why supermarkets aren't playing B103 or Walk FM," Widmer noted.
Despite a multitude of laws and rules, there are constant questions about who needs to get paid when a CD is sold, a track is downloaded or a bar stocks its digital jukebox. Some songs, for instance, don't generate money only for publishers and performers, but for nonprofits: Harry Chapin's "Cat's in the Cradle" helps fill the coffers of the not-for-profit Harry Chapin Foundation every time it plays - and not just on the radio.
Chapin's most famous song was a ringtone in the movie "Last Vegas." It popped up in a "Shrek" sequel, too, and has also played in TV shows including "The Simpsons" and "Modern Family" - and all of those cameos produce royalties.
While songwriters usually do well, the artists often lose out in these arrangements, particularly when it comes to radio broadcasts. The Alessi brothers, who work out these days out of a Cold Spring Harbor studio, were honored to sing background for Paul McCartney's "No More Lonely Nights," but collect virtually none of the hit song's royalties.
Cold play
Not that the Alessi brothers are hurting. In addition to performing their own music, the pop duo who had hits in 1977 with "Oh Lori" (No. 8 on the UK Singles Chart) and 1982 with "Put Away Your Love" (No. 71 on the U.S. Billboard Hot 100) has written songs performed by the likes of Frankie Valli and Olivia Newton-John, in addition to the song on the "Ghostbusters" soundtrack. All told, Billy Alessi, who's also executive music producer for Houston-based creative services company The Axcess Group, estimates the duo has sold 18 million records, and that's not even counting residuals for "just for the taste of it" jingles they penned for Diet Coke commercials featuring Elton John and Whitney Houston.
The result, Alessi said, is a flow of digital money coming in constantly from around the globe.
"I see places like Istanbul," he said of their royalty statements. "In Brazil, we're popular. Australia. Greenland."
In this way, the Alessis have smartly navigated royalties waters that have drowned countless other artists. New York Dolls front-man David Johansen, aka "Buster Poindexter," is the well-known voice behind the toe-tapping 1987 hit "Hot, Hot, Hot," but he earns no royalties from his most famous hit, Alessi noted, "because he didn't write it."
"If he wrote it," Alessi added, "he'd be on his yacht."
Of course, musicians being shortchanged by royalties rules is nothing new, according to many industry insiders, and it's continued unabated in the digital age. Federal copyright law was amended in 1972 to cover sound recordings, but next-generation radio services like Pandora and Sirius XM have interpreted that to mean that don't have to pay performers for recordings made pre-1972 - so when the Four Tops' 1973 hit "Ain't No Woman (Like the One I got)" plays on Pandora, the Four Tops get paid, but when earlier recordings like "Baby I Need Your Lovin'" play, they don't.
The final truth, according to many, is that the digital age has simply introduced new turf for the never-ending royalties wars.
"We're in a period of multiple disruptions," said Russell of the Harry Fox Agency. "Physical sales were disrupted by downloads. Downloads are being disrupted by streaming. Until things settle a little bit, it'll be unclear where it's all going."
Published: Thu, Sep 18, 2014
