(re 96), if you take it as read that you are entitled to be paid each time your work is played, broadcast, or copied, then of course a tax is much simpler than a collection society. However, I posit that there is no such entitlement, nor should there be.

I suggest that you sell your work to your fans once and for all, whether a live or studio performance, broadcast or recording – and never get paid for that work ever again. It’s just like any other craftsman selling their material work.

Think of a ‘recording’ as like the writing of a novel or the production of a movie. The recording is the work, the result is the master. Traditionally, the work, the recording has not been sold to the audience, but copies thereof. The copies cost next to nothing, but their price has been artificially inflated by a state granted monopoly (copyright) that prevents anyone making their own copies.

So, I’m saying to the musician, “Sell your music (performance or recording), not copies”, to the author, “Sell your novel, not copies”, and to the movie-maker, “Sell your movie, not copies”.

I’m saying “Sell what’s valuable! Do not waste your time trying to sell that which people can make themselves for nothing.”

You can say it’s crazy to sell what’s valuable, to sell the actual work, that people must be able to sell copies at artificially high prices as they have done for the last few centuries. However, I suggest it’s those who insist on selling copyright ‘protected’ copies who are crazy.

A tax certainly appears to solve the problem, but it’s a terribly inefficient and ethically unsound solution.

Songwriting is different, however, there, you give other people the option to release your compositions and generally expect a royalty, or you can do a ‘buy-out’. As a songwriter, you have little or nothing to do with the recordings.

Your response to 89. You are presenting a business model that, under my understanding, you must know the in’s and out’s about. So, rather than saying that I don’t believe humans can swim, I’m saying, right, you seem to know the mechanics of swimming, so, I’m happy to get into the water and take your instruction. I never once disregarded the possibility of it being a ‘model’, however, I do doubt the effectiveness in a world where there is so little difference between a master recording and a copy (other than on paper and within a certain set of ‘rules’. The same rules that you have deemed ‘unnatural’.) So, all I’m asking is that if you consider selling recordings directly to fans as a new mechanism, why not explain the mechanism and how it would be implemented? x

Very few musicians have sold their recordings directly to their fans. There aren’t many facilities to do so either. You could certainly do a test, but given a lack of facilities and the unfamiliarity you and your fan base will have in purchasing or commissioning your recordings, the results of the test should not be considered conclusive.

I was only hoping to at least persuade you to acknowledge this revenue mechanism and business model. However, you now appear to want to jump straight in the deep end with a test. This is a bit like me trying to persuade you to consider the possibility that human beings can swim, and you refusing to consider the possibility as anything except delusional until one day you say “Ok, I’m game. Which cliff should I jump from?”. We appear to have missed out a big chunk of intervening discussion concerning the actual technique of swimming let alone diving and making sure there’s water to dive into.

There are two obvious ways of selling a recording:

1) You have already produced a recording, but not yet released/published it. You are interested in your fans’ best offer in case it may be better than that of a record label.

2) You are interested in producing a recording, and invite record labels and your fans to tender their offers of commission.

A less obvious way is as follows:

3) You regularly produce and release recordings to your fans by way of ‘priming the pump’. You invite your fans to commission the release of subsequent recordings. The initial releases are promotional loss-leaders to build the fan base to a size where their subsequent commissions match and possibly exceed the costs of production.

In all cases 1-3, the purchaser of the recording effectively ends up with the right to make copies. If you sell a recording to a label, they get any copyright (the privilege that suspends everyone else’s liberty to reproduce it). If you sell a recording to your fan base, any copyright is neutralised (your fans’ and everyone else’s liberty to reproduce it is restored). Indeed, when selling recordings to your fans, copyright becomes a redundant nuisance to be disposed of, rather than a privilege to be sold to those unscrupulous labels who’d exploit it in their sale of copies.

At least when an artist sells a recording to their fans, they retain all their (natural) rights. When an artist sells a recording to a label the artist loses their liberty to make copies. When an artist sells a recording to their fans they retain their liberty to make copies (a consequence of neutralising rather than transferring copyright).

The recording (as deliverable) comprises the digital master and all components thereof as would typically be expected by a record label. If sold to one’s fans, then at the point of exchange this must be supplied or made available to the purchaser (one’s fans), e.g. as FLAC files via BitTorrent. Anyone (including the recording producer) can then sell material copies (media and delivery costs) in instances where such delivery of the recording is preferred, e.g. on DVD-ROM.

In the other direction, the sale price that the artist agrees is equitable in exchange for the recording (say $10,000) is provided from each fan (say $10 from each of 1,000) and delivered to the artist (or the company representing all those involved in the production of the recording). Typically, each fan will pay the same amount, but some schemes may involve variations.

There are umpteen other issues (quality assurance, etc.), but we can cover those another time.

In answer to your other questions, this is not an investment in the artist, but the sale of a recording. The fans get the recording they want. The artist gets the money they want. Moreover, everyone gets their liberty restored.

In terms of facilities with which to test it, one could attempt to shoehorn eBay’s Dutch auction to sell 1,000 ’shares’ in a recording if you reckon you’d easily sell out and the minimum bid price was around $10 (if you hoped for at least $10k). This also has to pass eBay’s scrutiny as the sort of auction it’s happy to see (doubtful).

Alternatively you could try Kickstarter. See Pros and Cons of the Kickstarter Model.

Predictably, the more artists that start selling their recordings to their fans, the more facilities will be developed, and the more familiar fans will be with this means of encouraging their favourite artists to produce recordings for them.

However, it is important to note that ‘more facilities’ means ‘less overhead’. The more facilities there are to enable artists to sell their recordings to their fans, the more competition there is to provide artists with such services at ever lower prices. Contrast that with a single taxation and disbursement administration that has every incentive to ratchet up its costs and overheads.

Privileged cartels and government backed central services are the entities to establish ONLY if you want less rather than more of your fans’ money.

So, cut out the middleman! Or at least ensure that there’s a highly competitive environment such that any middlemen have to be extremely fit, lean and cost conscious if they expect you to use them in selling your recordings to your fans. If you create a tax instead, you’re creating one humongous Jabba the Hutt and very little prospect of seeing much more than a tiny trickle of treasure leak from its greedy clutches.

In other words you can look forward to the same AMOUNT of overhead, not necessarily the same overheads.

If the only way artists can get paid is to go through the same gargantuan central bureaucracy then they can look forward to paying for quite a few marble floors and mahogany staircases before they see a single penny end up in their pocket. It doesn’t matter that the process SHOULD be efficient. When there is a single administration, it will be incentivised to bulk itself up with inefficiencies and mutually profitable overheads via other participants in the tax collection chain.

The only way musicians will earn more via tax than a free market is if they give up making music and get a job in the national music tax administration facility.

The crux of the matter is that calling it a license fee implies that singing another’s song SHOULD be illegal, and thus SHOULD require permission or payment (of a license fee). A tax on the other hand is simply an expedient means of collecting funds for national infrastructure, which then raises the question as to why the heck songs should be considered as infrastructure.

At least ‘tax’ is a more honest term in that it’s saying “Instead of seeing them struggle in a free market like everyone else, we thought we’d do songwriters a favour and tax everyone for singing songs, and then disburse the tax back to all songwriters according to how popular their songs are”, i.e. it’s not saying that singing another’s songs is a priori illegal, it’s just saying “If you sing, you must pay. If you write songs, we will pay you according to how widely they’re sung”.

So, there is sod all difference between a license fee and a tax. The same money is collected and disbursed to the same people. The only difference is whether you believe the underlying activity should be illegal in the first place, e.g. singing another’s song without their permission.

As you know, I do not believe singing another’s songs without permission should be considered a fundamentally illegal activity, given it violates no individual’s natural rights, therefore any fee to be collected from those who do so is properly termed a tax – not a license fee.

And to tax singing as a means of paying songwriters would be a colossal folly, to top the 18th century folly of copyright, i.e. making it illegal to sing another’s songs without permission.

It’s amusing that you acknowledge the overheads* of copyright as 75% (which through creative accounting is usually pushed closer to 99% for signed artists), and yet by some leap of faith you hope for less than my generous 50% as the overhead of enforcing, measuring, collecting, and disbursing a tax.

The overheads under the ‘old’ distribution model (e.g. putting cds into retail) was made up of recording costs, manufacturing, distribution, shelving fees, promo fees (if you did a TV advert, for example and you had your units on the shelves at ASDA or Sainsbury’s, they would expect a tag on the advert “available at ASDA” etc.) In order for an independent to get shelved at any major retailer, a minimum marketing budget was required, on top of that you paid pluggers for radio and any other PR, publicists, etc. etc. Whether on a major label, independent, or D.I.Y., you had a good way to go before break-even kicked in. Under ‘new’ model, you have no manufacturing. So, an artist can go straight from recording costs out to the ‘market’ place. So, the reduction of overheads for the artists are very significant. In both cases, most artists need to rely on some form of ‘collection’ agency simply due to time. Otherwise, they would need to engage someone to collect on their behalf. This is why many songwriters and artists have joined societies to collect for them on their behalf. In your above statement, you are comparing two very different mechanisms. What happened during the old sales machine is fairly different to what happens when it comes to royalty collections. And in the new-ish potential scenario, those overheads should become minimal if a proper system is put into action.

As I’ve said before there are three primary revenue models:

1) Reproduction monopoly (invidious 18th century anachronism, wet paper bag, etc.)
2) Taxation (an invalid equation: ‘work + 50% overheads = popularity/communication tax’)
3) Free market (sale of intellectual work to those interested in its production)

It’s amusing that you acknowledge the overheads* of copyright as 75% (which through creative accounting is usually pushed closer to 99% for signed artists), and yet by some leap of faith you hope for less than my generous 50% as the overhead of enforcing, measuring, collecting, and disbursing a tax.

Insanity is repeating the mistake demonstrated by history and hoping for a different result.

Of course a tax is appealing, given it seems like a much easier way of making money (taking it through force and then dishing it out). However, that’s generally ‘easy money’ for the administrators. The artists still have to work like buggery to beat those who control the communications channels effectively gaming the system, i.e. the broadcasting and publishing corporations.

If you want artists to have more money the best thing to do is to stop finding ways of funnelling the 99% of it to administrators and publishers, i.e. stop proposing to replace their now ineffective privilege of copyright with an equivalent tax.

Try a free market, where artists and their fans exchange art and money directly. It’s working for the free software industry (software engineers and the users of the software interested in its development).

Yes, the downside of a free market compared to taxation is the fact that you have to deal with your customers and give them what they value for their money. A tax on the other hand is nice in that you can produce cookie cutter crap and get paid far more due to its popularity than an esoteric album that takes you years of hard work to compose and produce, and yet has such a small audience that the popularity is unmeasurable and so obtains no tax dividend. With a free market you are able to be paid commensurately, e.g. a million may pay a penny for a simple ringtone, but a thousand may pay a hundred dollars each for an esoteric masterpiece.

See Retailers fear Simon Cowell and Harry Potter overkill.

[I'll answer 89 later.]
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* not even including the cultural cost.