photostill

Not to say that Kim is an angel, he's not. Still he got a dirty deal. One that he is fixing to do payback on.

I think what really shook the tree here in the states, is him setting up to do the Megabox. If you are not familiar with that, Megabox was how he was going to sell new artists coming to Megaupload.

You see, the major labels have forever given the artist the shaft. They pay an initial lump sum to the band. By the time everyone gets their cut out of that lump sum the band hasn't made much per individual member. It's been often sited that they would make more money working a minimum wage job than making music. The major label won't pay them royalties until all the money spent is recouped, including the lump sum. There is nothing in that which says the major labels should watch their spending in charging back to the band. So it's usually high prices because the majors get to keep all the money till everything is paid back.

What Kim proposed was the death knell to major labels. He wanted the artists to give the music for free; no payment at the start. The artists get to keep their copyright. But the way they would have gotten paid was through serving ads to those that wanted to play the music. Megaupload would have kept something like 10% for the fee to host them and everything else would have went back to the artists. The majors were luckly to be paying 5%, if that. With that kind of deal, few if any bands would want to sign a contract to a major label. Megaupload would have required those that wanted to hear the music to download a special Megabox player that would have served the ads as well as the music. I suspect this more than anything else was the reason for the bust.

Since this hasn't shut him down, it looks like more hard times are ahead for the music industry and maybe for movies as well.

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