Tag Archives: Value of Music

Rescind the Digital Exemption

Published 10/17/2019

By Ed Henderson

In February 2007, believing that nothing major would ever become of Internet broadcasting, the Canadian Radio and television & Telecommunications Commission (CRTC) announced an exemption order (C-58) – now referred to as the Digital Exemption – for Internet delivered content. This exemption meant the Internet would not be treated as a broadcaster and would pay no taxes. Foreign ownership would be unregulated and there would be no requirement to feature Canadian content nor make financial contributions, as all other broadcasters do, to the creation of Canadian content.

Internet broadcasters have laughed all the way to the bank ever since.

The Canadian government has long recognized our proximity to the USA as a threat to our cultural existence. Since the early 1900s, government sought ways to protect Canada’s unique culture. In 1936, the federal government introduced the Broadcasting Act, which established a place for Canadian voices to be heard in every part of our country. Since 1957 the Canadian government has regulated the allowable percentage of foreign ownership of Canadian broadcasting entities at 20%.

Canadian content regulations in television (enacted in 1961) and radio (enacted in 1970) have helped build our culture, so much so that artists from the 1970s onwards were able to establish their careers in Canada. Before those regulations were created, many aspiring Canadian artists were forced to leave the country to find success.

Today, the presence of an increasingly dominant and unregulated Internet means history is repeating itself. Once again, we are seeing Canadian artists leave Canada to establish their careers in the arts.

The result is that we are losing jobs in all media and arts. We are also losing Canadian content and programming.

Creators, artists and publishers in Canada are not the only sectors affected by the unregulated Internet. As Internet broadcasting has grown, traditional media in Canada have suffered: newspapers, TV, radio and cable have seen their advertising revenue drop year after year. Conventional TV revenue fell from $1.984 billion in 2011 to $1.411 billion in 2018 – nearly 30%. This has resulted in financial losses every year, beginning in 2012, with $7 million to last year with $144 million (total deficit in only seven years is $675 million). Commercial radio revenue peaked in 2013 at $1.6 billion falling to $1.49 billion in 2018 (a loss of 7%).

The result is that we are losing jobs in all media and arts. We are also losing Canadian content and programming.

Such losses of revenue have caused less spending on production. Producers have less to pay creators. Producers increasingly demand creator copyrights and the royalties that are due to them – surely, an unintended side-effect of the Digital Exemption.

Meanwhile, the Internet broadcasters, mostly located in California, are making billions. Over the top (OTT) revenues have gone from $115 million in 2011 to $1.3 billion in 2018 (a 1,130% increase), and projections for 2022 are $2.351 billion. Almost none of this revenue stays in Canada.

Richard Stursberg and Stephen Armstrong in The Tangled Garden (published by James Lorimer & Company Ltd., 2019) provide a simple fix for this problem: rescind the Digital Exemption.

They write: “Culture is an enormous business in Canada. It is worth, by the government’s reckoning, almost $54 billion per year and employs 650,000 people. This makes it almost twice as large as agriculture, forestry and fisheries industries combined. It accounts for double the number of jobs in mining and oil and gas.”

Stursberg and Armstrong vividly describe the swift pace of the losses to Canadian culture: “Beginning around 2010 . . . much of what had been accomplished began to erode. The once mighty newspaper industry struggled to survive, shedding journalists and closing bureaus across the country. The vastly profitable television business began to lose money. CTV, Global and CityTV, the powerhouses of the private news business and the biggest commissioners of Canadian drama and comedy, were all under water by 2012. The magazine and film businesses were also swept into the downdrafts created by the FAANGS.” (Facebook, Amazon, Apple, Netflix, Google)

Action by government is urgent.

Rescinding the Digital Exemption will likely cost Canadian citizens and government nothing. According to Stursberg and Armstrong, “Extending the sales tax, abolishing the tax credits for foreign offshoots and eliminating the loophole on the application of C-58 will generate sufficient funds” to protect Canadian Content in the digital marketplace.

“The measures are neither novel nor strange. They are, in fact, simply extensions of the rules that have historically governed broadcasting and newspaper businesses. They require that the FAANGs be subject to the same tax regimes as the traditional media, that they make the same contributions to the production of Canadian content and respect the same standards of civility and truthfulness that bind the newspapers and broadcasters.”

Action by government is urgent. The authors warn us: “these changes in policy . . . must be made now. The financial situation of the traditional media is so fragile that they can not wait much longer.”

These simple changes would nearly double the amount of support for our Canadian cultural industries and provide increased tax revenue for Canada. Stursberg and Armstrong hypothesize that, if the Digital Exemption was rescinded and the Internet broadcasters were treated as what they are: broadcasters, – the $100 million that Netflix spent on production in Canada in 2017 would have been $230 million and would rise to $320 million by 2021.

The European Union has taken action. It recently passed legislation to support its thriving cultural economy by applying the same regulations that all non-Internet broadcasters are subject to all Internet broadcasters.

Canada must do the same. Treat the Internet as the broadcaster that it is. Regulate it, require it contribute their fair share of and support and broadcast Canadian content.

Canada’s cultural existence depends on it.

A version of Ed Henderson’s editorial was published in the October 15, 2019, edition of The Globe and Mail.

About Ed Henderson


Digital revolution fosters more hurried, less skillful creative process

Published 10/12/2017

By Miranda Mulholland

Classically trained on violin and in voice, Miranda Mulholland is in high demand as a fiddler and singer covering a wide range of styles. She’s a member of the duo Harrow Fair, and the fiddle trio Belle Starr, and makes select appearances in the violin show Bowfire. She runs a music label, Roaring Girl Records; founded the new Sawdust City Music Festival in Gravenhurst, ON; is a member of the Board of Governors of Massey Hall/Roy Thomson Hall; and sits on the board of the Canadian Independent Music Association (CIMA).

I love looking at drafts of artwork. I love early versions of novels, songs and poems. I love sketches of paintings. I recently saw an early oil sketch of John Constable’s “The Haywain” at the Victoria and Albert Museum in London.

You can see the skill, of course, but comparing it with the final version that hangs in the National Gallery, you can clearly see the thought, decision and composition that he worked through to arrive at the end result. I almost prefer the sketch.

There’s an art economist, David Galenson, who talks about the process of creation. He differentiates between the flash of lightning versus the arduous creative process. We hear a lot about the first type, what he calls “conceptual innovators”. The songwriters who wrote a song in minutes and it went to number one. The painters who sat at a canvas and with deft strokes completed a masterpiece. This idea goes back to ancient Greece, and the muse visiting with ideas of brilliance. But the notion that this is how it always transpires pays short shrift to the actual grueling and painstaking work and revisions that most artists’ work undergoes. These are the “experimental innovators”.

Leonard Cohen took six years to write “Hallelujah.” Bruce Springsteen took six months to work on the lyrics to “Born to Run.” Margaret Mitchell took 10 years to write Gone with the Wind and our own Alistair Macleod wrote his stunner No Great Mischief in 13 years.

Creating art is the use of skepticism for what’s come before, and the application of curiosity, which leads to the imagination arriving at something utterly new, through skill. In an increasingly hurried world, it’s important to use long-term thinking. Governments, funders, publishers and labels need to remember that most artists need time to develop, grow and realize their visions.

For instance, The Tipping Point author Malcolm Gladwell, when asked about the pressure the publishing industry puts on writers to write quickly, said, “Quality work takes time. As a writer, my principal observation about why other writers fail is that they are in too much of a hurry. I don’t think the problem with writing in America right now is a failure of output. I think it’s a failure of quality.”
Our current social climate has been moving further away from time and skill. The notion that anyone can record an album in their bedroom and upload it for free is in theory a democratizing one, but it begs the question: Just because you can, should you? There’s a whole “amateurizing” movement which is exactly the same concept – a democratizing idea, but put into practice, what does it amount to and how does it translate to the consumer?

When I was in Grade 7, I was in a string quartet that would play for weddings. The cellist had put the group together and managed the bookings. She was the most inexperienced member of the quartet musically, and didn’t practice enough. For the last wedding I played with that quartet, the bride had requested Pachelbel’s Canon – which is right at the top of the Wedding “hits package”; I’m sure you’ve heard it many times. The cello part has eight notes in it – the same pattern, over and over. She didn’t ever get through the sequence without a mistake, and the piece came off as pretty amateur affair. I tried to be diplomatic after the wedding and suggested that perhaps “we,” as a quartet, should practice more before we accepted any further payment for our services.

Her response was that the bridal party seemed perfectly fine with it and didn’t notice the mistakes. But this is my problem with that: we were hired to notice. We were hired to be the experts, the arbiters of taste and skill. When this contract gets fuzzy, quality suffers. Trusted tastemakers have been eradicated by shrinking budgets and replaced with algorithms.

I’ve had some wildly sub-par service with Uber and Airbnb, and read some pretty poorly written “news stories” and blogs that just regurgitate press releases – or what’s known as “citizen journalism” – and I wonder when we got so afraid of skill and expertise.

True tastemakers are becoming endangered. There has been a vast and exponential growth in output and content in the last 20 years. While reviewers and consumers are drowning in choice, paid arbiters of taste are being laid off and replaced by amateurs.

One of the purported benefits of the digital revolution, that we’re all by now very aware of, is targeting. Because of the vast amount of data collected from all of us, we can target our exact audiences. We can be precise, allowing niche-market music to find its consumers.
The trouble is, niche isn’t easy. Because the streaming system is built on market share, the miniscule fraction of a cent you get per stream decreases wildly if your music isn’t in the mainstream. The less it’s streamed, the less it finds its way into the playlist algorithms, and then the less it’s ever played again. Niche becomes an ourobouros, a worm swallowing its own tail. Not only that, but because it’s financially such a small part of the market, it’s sometimes erased altogether.

But fostering niche is important. Why? When you look at language, there are words that are rarely used. They’re not mainstream words. They are able, however, to capture a sentiment absolutely and completely. Did you know that the word groak means staring silently at someone while they eat? That’s not a word you use on a regular basis, but I’m glad it exists.

When we limit and hinder access to these words we actually limit thought. Remember Winston Smith in 1984, a novel that gets more timely by the day. His job was to get rid of words from the dictionary to limit and control thought, creating “newspeak.” Things like spell check and text predictors are speeding up this process.

I believe algorithms threaten to limit and control as well. The calculations are based on decisions you, and those with similar taste profiles, have already made. This is limiting to imagination, and to those surprise discoveries, and against-type choices, that radically change thoughts. And changing thought patterns is one of the most powerful things about art.

So, what key piece are we missing here? We can find it in the artistic process. It’s the key to creativity: imagination. Imagination leads to skepticism, not in doubt but in curiosity. It allows us to not accept absolutes and givens, and to envision new perspectives, solutions and realities. We can employ the tools “skepticism” and “curiosity” to take ownership of our decisions, and unlock new and exciting thoughts, discoveries and inspiration.

News, music, book suggestions, products we might like popping up in our targeted ads is easy. But easy isn’t always good. We need to be more skeptical than ever, and reclaim the power of being our own tastemakers.

The value of music is high

Published 06/9/2015

By Jennie Flannery

Before recording an album, I never really thought about all that went into the making of one. I was definitely a LimeWire fan, and had the attitude of “why buy when I can download for free, or borrow a friend’s and burn it?”

I’ve done a 180-degree turn on that kind of thinking, and I’ll tell you why.

Just to write songs, or play an instrument proficiently enough to draw an audience, can take many years of hard work and dedication. That doesn’t include hours and hours of listening to various artists and styles of music in your selected genre to soak up your influences. Then, you need to work at being creative, becoming a musician with your own personal style and take on the music.

Creating original songs requires time and heart, as an expression of yourself and your individuality as a musician. You want, and need, to be unique as a songwriter in order to set yourself apart from all the others out there.

You also have to spend time and money getting out there to perform, and get a feel for what people are, or aren’t, enjoying about your music. You need to learn to feel comfortable in any situation onstage, with or without any distractions, and how to appeal to any audience.

When it’s time to record, you have to do the research to determine who’ll produce your recording, and which songs you’ll perform.

If you play solo, you’ll likely have to find players to accompany you on your recording. That requires more time and effort, talking with or e-mailing fellow musicians and figuring out who’ll do the best job with your songs and playing style. You have to arrange some rehearsal time and figure out the arrangements of the music. So as not to waste time in the studio, you have to spend lots of time rehearsing the songs until they’re as close to perfect as they can be. That takes a couple of days, and whatever the musicians charge to rehearse with you.

You have to choose a recording studio in your area, which involves more time, effort and research. You’ll likely have to spend money on musical “incidentals.” Like, say, piano tuning –  $100. Renting just the right mic for your sound — $150.

Now you begin recording. Even at a small, independent studio, owned by a friendly producer, that’s at least $50 an hour, and usually an eight-hour day, so $400 a day. And you have to pay the musicians again for their time, which also usually runs $50 an hour – each.

And in addition to the hours of recording, unless it’s a raw, live-off-the-floor “feel” you want, you’ll spend a lot of hours mixing – like splicing the intro from take two with the first verse from take four, and the chorus from take seven. Or making the sure the volume level of the guitar solo is properly balanced with all of the other instruments. Sometimes this process requires a mixer, who costs as much as a producer.

If you’re recording an album, you also need to spend more time, effort and research listening to all the tracks and figuring out some kind of order for them. You could put all your best stuff first, to appeal to radio and media, because they might only listen to the first few songs. But then you lose a balance of your strongest tracks throughout. You can listen over and over, continually switching up the order, listening for how each track ends and leads into the next track. Do the keys work together? Is a crazy fast track best followed by a slower track?

Then comes the mastering process, which usually comes in around the $1,000 mark. The disc is sent to the most recommended but still affordable mastering person you can find, to compress the music to give it an even overall sound. Now, you need to give it a final listen to hear what he or she’s done with the mastering. Sometimes there’s some back-and-forth here, and each set of fixes costs more.

For an album, at some point during the recording process, the graphics need to be done for the front and back covers and the insert. You need to hire a photographer for a photo shoot, and hire a graphic artist to design the cover and insert. You need to write out whatever information you want to include with the music. You’ll be reviewing layouts, colours, fonts, and so on. More time and money spent.

If you’re covering anybody else’s songs, you have to research the songwriters, and file the correct forms and pay the right mechanical royalty fees to the CMRRA in order to manufacture your albums, and find out if any need any other licenses, or permission to use. More time and money spent there.

If you want your album to gain some media traction, you’ll likely have to hire a publicist, who’ll write a bio, press release, send out your music to the media, and work to get your music coverage in newspapers, on the radio, on television, and on blogs and social media. You’re looking at about $500, minimum.

If you’re manufacturing CDs or vinyl, you can do a minimum run of 500, but you’re looking at about $2,000 at the very least. But about 300 of those copies are for publicity purposes, so you can’t sell those to recoup.

As you can see, it’s a small fortune – about $10,000 – to record and release an album. Even offset by crowdfunding, it’s likely you’ll still have to spend about $5,000 or so to get it done.

So next time you hear some music that you love, I urge you to give the music creator the credit and respect they deserve for all the hard work they’ve put into becoming the musician that they are, and the recording they’ve made. Buying their music gets them out of the hole financially, and supports their career, which is especially true for a small-scale, independent artist.

Free downloads are really a means of stealing from the artist. Burning CDs is actually illegal, and disrespectful of a music creator’s hard work. No artist could continue providing their music to the public if they’re not being paid for it. Would you provide your own handmade goods or services for free? No. And neither should music creators.

Does U2’s Apple deal devalue music?

Published 09/18/2014

By Howard Druckman

Last week, U2 released their new album Songs of Innocence to 500-million-plus Apple iTunes subscribers, free of charge…at least to iTunes users.

The New York Times reported that Apple paid the band and Universal Music an unspecified fee and committed to a marketing campaign worth up to $100-million  in order to release the album “for free.” The announcement came at an Apple event watched worldwide, launching the iPhone 6 and the Apple Watch.

It’s already clear that music listening, and payment for it, are moving from an ownership (physical sales, if not so much downloads) to an access (streaming) model. But the ownership model pays musicians decently, while the access model currently pays them mere thousandths of a penny per play. It’s also clear that Apple subscribers will gladly download the U2 album without paying for it. But the public perception of the value of music suffers as a result. And you can’t put a price on public perception, which can take years to build, and only a few moments to destroy.

At the launch event, Apple’s Tim Cook announced a “free iTunes release,” but Bono quickly countered with an emphatic, “Yes, but you’re going to have to pay for it.”  In a later statement, Bono – at pains to counter the perception that U2’s deal devalues music – said: “Apple bought it as a gift to give to all their music customers. Free, but paid for. Because if no-one’s paying anything for it, we’re not sure ‘free’ music is really that free. It usually comes at a cost to the art form and the artist… which has big implications, not for us in U2, but for future musicians… who need to make a living to write [their music].”

But if 500 million iTunes-subscribing consumers don’t have to pay anything to download and own the latest album by U2 – arguably the biggest band on the planet – it sends a message to all consumers that all music isn’t worth paying for. If consumers don’t have to pay anything to own a U2 album, why would they pay anything for an album by a local working musician, or the future musicians to whom Bono refers? Even if U2 are being paid, their deal with Apple contributes to the idea that music is worth less and less (if any) of the consumer’s’ money. And as the perceived value of music plummets, so, too, does the potential income of musicians everywhere.

Recent reports say that some music retailers, and some record industry executives, agree that the U2 deal devalues music. “I’m not sure that this giveaway is good for the business,” one senior label executive reportedly said. Another said it will hurt smaller artists, who still count on sales revenue. Commenting in Canada’s own FYI online magazine, Editor David Farrell said the U2 deal “made many music insiders feel uneasy, that this was a day the value of music died, as Bono and crew… signalled to their fans that buying music is completely passé.”

There are recent examples of similar music-devaluing marketing ploys by Jay Z (a million “free” copies to purchasers of Samsung’s Galaxy phone, for a reported $5 million in his pocket, in 2013) and Radiohead (offering 2007’s In Rainbows online for a “pay whatever you want” price).

When In Rainbows was released, journalist Will Hodgkinson, of U.K. newspaper The Guardian, wrote: “Spare a thought for the thousands upon thousands of bands and singers who, nowhere near Radiohead’s levels of fame and fortune, now have pretty much no chance of ever making a living from their music.” Substitute U2 for Radiohead, and the same statement could be made today.

What do you think?