BMG Entertainment will share its take from an industry lawsuit against music portal MP3.com with all of its artists whose copyrights were infringed, regardless of whether those artists’ contracts require participation in legal settlements, BMG North American topper Bob Jamieson said Tuesday.
However, the devil — who gets how much and when, for example — is still in the details. EMI, Warner Music and Sony Music have made similar claims, but no one has seen any money yet.
“We value our relationships with our artists, and we feel this is the best course to take to foster those relationships,” Jamieson said in a statement. “It is our plan to begin crediting our artists’ accounts just as soon as all of our recordings and artists have been identified.”
Announcement came after BMG came under criticism from artists’ groups for indicating it would only share the settlement — estimated to be worth between $10 million and $15 million — with acts that included the contract provision when they signed with BMG labels.
Industrywide, only about a fifth of artists are said to have such provisions, which are especially difficult to secure for newer acts with less bargaining power.
“Basically, whether or not it’s in an individual artist’s contract, it’s the spirit of the contract that whatever money a label makes from the work of artists should be shared with artists,” said Noah Stone, head of the Recording Artists’ Coalition. “It’s really cut and dried.”
BMG, along with the four other majors — EMI, Sony Music, Universal Music and Warner Music — sued MP3 last year for copyright infringement relating to the Netco’s digital music locker service, My.MP3.com. MP3 eventually agreed to pay roughly $170 million in settlements and judgments to the majors, several indie labels and publishers’ groups.
U, which held out the longest and won a $53.4 million judgment against MP3, said after the trial that it would distribute half the award, excluding $3.4 million in legal fee recoupment, directly to its artists. The label group since has bought the struggling company MP3.com for $372 million.
Foot-dragging on payouts?
The remaining three labels, EMI, Warner and Sony, have indicated they will share their settlements, said to run about $20 million each, with artists regardless of contract wording. In recent months, however, they have faced accusations of foot-dragging on payouts to artists.
Sources indicated BMG would complete its artist payouts by the end of this year.
The RAC’s Stone also worries that as the majors become increasingly involved in online distribution, artists will lose their only means of unfettered communication with their fans.
“The labels are succeeding in grabbing more rights on the Internet than they had before,” Stone said. “It would be very disconcerting if the Net, which we had hoped would improve the lot of artists, may actually end up being more restrictive for them.”