Addressing shifting landscapes of royalties and compensation in the digital age, the P&E Wing assembled a heavyweight panel to examine what producers, engineers and mixers need to do to adapt in this new era
SANTA MONICA, Calif. (December 17, 2013) — The Recording Academy® Producers & Engineers Wing® and Nashville Chapter recently hosted a panel discussion on one of the most complex yet often obscure topics in the modern music industry. "Lost In Transaction" featured an all-star panel of industry experts in the areas of compensation for record producers, recording engineers and mixers. The panel, which took place on Nov. 19, 2013, at the Ford Theater in the Country Music Hall of Fame in Nashville, Tennessee, looked at this complicated subject through the experienced lens of those who face the changing economic landscape of the music industry on a daily basis. The panelists were:
Alia Fahlborg, who built Nettwerk Producer Management into the leading agency it is today, with a roster of producers and mixers that includes top talent and GRAMMY® winners, including Bob Clearmountain, Howard Benson and Matt Serletic.
Linda Edell Howard, a partner with the Nashville-based law firm Adams and Reese, and Team Leader of the firm's Entertainment/New Media Practice Group, whose clients include Lady Antebellum, Bryan Adams, Keb' Mo', Steven Curtis Chapman and others.
Charles Sussman, President and Founder of Sussman & Associates, an entertainment-business management firm that specializes in global business and financial management, royalties and tax planning. Sussman has performed or supervised over 150 royalty and participation audits, and he also serves as the Chairman of the Outside Audit Committee for MusiCares and the GRAMMY Foundation.
The panel was moderated by Dan Daley, a veteran journalist who has specialized in music-industry business topics for 27 years and pens regular business columns in Sound On Sound, Resolution, FOH and other leading industry publications.
Music producers and mixers tend to have unique and highly creative relationships with their artist clients, with each project having its own individual and very personalized character, requirements and mix of technical prowess and creativity. The days when a recording created most of the revenue for artists, along with associated producers and mixers, are now over. Artists now derive income from a growing variety of sources, including touring, placements of music in various media and streamed distribution. The challenge for producers and their managers has been to find ways to participate in these new revenue streams, as well as to create new ones of their own.
As the music industry has moved from the full-album paradigm – the CD bundled with a dozen or more songs in a package retailing for $16 or more – to a single-song download market, following the money has become harder than ever. All three panelists stressed the need for producers and their representatives to make certain that valid letters of direction, which inform content owners and distributors as to the legitimate royalty participants on a record, exist at the right times and in the right places. These include not only traditional royalty collection agencies such as ASCAP and BMI, but also those that are the result of the new digital era, such as SoundExchange and the Alliance of Artists and Recording Companies (AARC).
Not all of the issues are purely economic. Fahlborg pointed out that engineers and mixers are increasingly being asked to create and deliver stems, which are used for backing tracks and other purposes. Not only is compensation for these additional services a gray area, but, added Linda Edell Howard, the fact that producers, engineers and mixers now routinely store massive amounts of copyrighted music on hard drives in their possession raises certain liability issues, all of which need to be contractually addressed in order to protect those who work with them. "There always needs to be a clearly worded deliverables document," she told the audience in the theater.
"The business issues that recording professionals face today are complex, and in many cases we are literally making up solutions as we go along," observed moderator Dan Daley during the panel. "We've spent the last two decades addressing the technical issues that come with digital music; today with this panel we put on the table in a very clear manner the fact that producers, engineers and mixers have to come to terms with an equally complicated business and economic picture, one that's changing literally by the day. These aren't easy issues to address, but doing so is critical to ensuring that there are viable ongoing careers for all parties in the creative process."
Maureen Droney, Sr. Executive Director of the P&E Wing, noted, "The Producers & Engineers Wing is committed to looking at all aspects of the music production workflow, and the business elements that affect record producers, mixers and engineers are as important as any technical ones. Our Nashville Chapter did a stellar job of engaging a comprehensive panel for this discussion and shedding light on this important subject."
Photo Caption: Pictured L-R: Jeff Balding, The Recording Academy® Nashville Chapter President; Charles Sussman, CPA, Sussman & Associates; Linda Edell Howard, Entertainment and New Media Team Leader, Adams & Reese LLP; Alia Fahlborg, EVP, Nettwerk Producer Management; Dan Daley, journalist/author and event moderator; and Julian King, P&E Wing Nashville Chapter Committee Co-Chair. Photo Courtesy of The Recording Academy®/Clyne Media Inc. © 2013 Photographed by: Yu Howe, Clyne Media, Inc.