French lawmakers gave approval to legislation that could force Apple Computer Inc. to make its iPod and iTunes Music Store compatible with competitor music players and online services. (Associated Press)

Handleman the music distributor will begin cutting costs including employees due to the lack of blockbusters coming out of the music business. (Detriot Free Press)

Virgin Group Chairman Richard Branson who has created an empire of about 200 companies in over 30 countries in sectors including air travel, mobile phones, financial, retail, music, Internet, drinks, rail, hotels, etc. announced a rock festival for Canada. The festival will hope to accomodate 50,000 fans, will feature more than 40 acts, including Massive Attack, Flaming Lips and Gnarls Barkley, and the Raconteurs. (Reuters)

U2’s outspoken Bono who has been a leading figure in encouraging the media companies to distribute music online will join the DRM fight. iTunes music is distributed with DRM locks, and DRM restricts the traditional rights of users of copyrighted works. DRM protects major record labels from competition.”
Â

Not too long ago A&R’s signed bands on gut instinct. That is what they were paid for. These days A&R’s look for “indicators” because they no longer know what to sign. Meaning, if some unsigned artist wrote a comparable album to GNR’s “Appetite For Destruction” and didn’t have 50,000 friends on myspace, the band would be looked over. This is idioicy at it’s best considering we know several methods of collecting thousands of friends on myspace every hour. Of course “out of touch” A&R’s just dont know these techniques.

The good news is that the labels just cleaned house and a small number of A&R’s who are left are anxiously hanging on to their jobs.

The bad news is that you still have “out of touch” older execs steering the ship into icebergs like the Titanic. They are more concerned clinging to their prestige than looking for new ways and platforms to break new artists. How is it that all the employees are let go except the ones making all the bad decisions? The problem never seems to be eliminated.

Of course its hard to find great artists that write compelling music, but older execs signing hardcore/screamo bands believing they are going to take over the world is a scary scenario. I’ve witnessed Presidents and CEO’s watching these recycled garage bands in smelly clubs saying “Wow, aren’t they great?”. My jaw dropped to the floor. Who’s fooling who? What is so funny dumping hundreds of thousands of dollars into a band that has a frontman that can’t hum a tune? After 10 flops and wasting other peoples money you would think these cats would learn, but insanity has gripped this industry like no other. Insanity is doing the same thing over and over again and expecting different results. Artists and label employees being victimized by “label politics” is at an all time high. President fighting against president is like watching kids in a sandbox fighting over buckets and shovels. Welcome to amateur hour.

What we need is a 50 foot Tsunami traveling at 500mph hitting the East and West Coast taking out Los Angeles and NYC and cleaning up the rest of the mess. Then the real rebuilding may take place.

PS: Just in case, GNR stands for Guns and Roses.

Â

Â

Â

At this point, most industry experts agree to the fact that EMI and Warner will pair up.

EMI recently raised the bid for Warner and rejected the counteroffer. EMI said it had increased its bid for Warner to $4.6 billion, from $4.2 billion in May, and also said Warner had turned the tables and bid about $4.6 billion for EMI on Tuesday. Neither company is welcoming the other’s bid. EMI said today that Warner’s proposal is “wholly unacceptable.” If these 2 companies combined “it” would own 25% of the global music business.

Analysts estimate there are several hundred million dollars in costs that could saved if the groups combined. If this happens, expect major lay-offs. Remember, that “mergers” don’t exist. “Mergers” are a myth. A merger is a dressed up word for takeover. Read the full article in the NY Times.

NBC who told YouTube to take “Saturday Night Live” clips off its site has made friends with the free video site YouTube. NBC cut a deal with YouTube to preview and promote it’s Fall broadcast line-up.

“The distinction between television and video is becoming murkier and murkier,” John Miller, chief marketing officer for the NBC Universal Television Group told AP. “Rather than putting our heads in the sand and saying this doesn’t exist, we’re trying to jump in and embrace it.”

As the record labels are currently removing their content on YouTube, NBC is embracing it. Good Move! (Lefsetz)

Every week KOAR will bring you an in-depth article by veteran music attorney and digital music expert Christian Castle. Enjoy!

There are many legal and business problems that have slowed development of digital music services. One of them is clearing the rights for songs for music subscription services that permit on-demand streaming of sound files.Â

  The same problem exists for permanent downloads. However, record companies have agreed to take responsibility for mechanical licenses for permanent downloads on U.S. based online services, the so-called “pass through� license that is so despised in publisher and songwriter circles.

  Record companies have not, however, agreed to assume responsibility for the payment of royalties for on-demand streaming as their lawyers don’t believe their rights under mechanical licenses and the Copyright Act extend that far. CONTINUE READING