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RIAA Revenue Dwindles As Labels Cut Back
Posted: 17 Aug 2012 Ernesto
http://torrentfreak.com/images/riaa-logo.jpg The RIAA has submitted its latest tax filing to the IRS, covering the fiscal year ending March 31, 2011. Despite the long reporting delay, the figures are well worth a look as they show a massive decline in revenue for the music group. In just two years the RIAA’s entire budget was almost cut in half. The total revenue in the latest filing is $29.1 million, down from $51.35 million two years earlier. This drop in revenue is a direct result of the dwindling membership dues paid by music labels, from $49.76 million to $27.88 million in the same period. The effects of the decline in revenue are also visible in the massive cuts in personnel. In its most recent filing the RIAA lists 72 people on the payroll compared to 117 two years earlier. In total these employees earned $12.7 million of which nearly 25% went into the pockets of the top two executives. The top earner in the year ending March 2011 was Mitch Bainwol (CEO) with $1.75 million a year with a working week of 50 hours. Current CEO Cary Sherman (then President) came in second with $1.37 million. Other high income employees were Neil Turkewitz (EVP International), Steve Marks (General Counsel) and Mitch Glazier (Public Policy & Industry Relations) with $696,036, $675,528 and $599,661 respectively. Looking at other expenses we see that the RIAA spent $2.3 million on lobbying, a figure that has remained relatively stable over the years. The same cannot be said for the group’s legal fees, which dropped from $16.50 to $2.34 million in just two years. The latter is the area where the RIAA cut back the most, in part by stopping their lawsuits against individual file-sharers. All in all the downward income trend clearly signals that there’s less support from the major music labels. While the RIAA is by no means defunct yet, the organization isn’t getting any stronger either. END The full 2010/2011 filing is available here. |
Re: RIAA Revenue Dwindles As Labels Cut Back
This is maybe some of the best news of the month.
The major labels have always had this control freak thing about their "property". If you want to use it, they charge more than it's worth. So much so, that many have had the idea of an internet music store, only to find out the fees to sell it doesn't leave them anything to maintain a site through expenses. There's not enough left to pay for everything that it takes to maintain a site and pay payroll. There are countless gravestones along the wayside of these ridiculous demands made to sell songs. If it's not DRM must be included then it's limiting where you can sell particular songs. Don't try to buy iTunes from Australia, the stores don't accept the money nor the IP when it comes to buying. Then there is the issue that major labels no longer act like they did in the days of old when it's heyday was going. During that time, you had musicians who understood what they went through, day to day, as the CEOs of the big labels. Today it is lawyers and accountants that run the show. They have no understanding beyond money and courts. In the process the RIAA and various affiliates around the world, have earned a reputation for the labels of being dirty, underhanded, sneaky, vengeful, and down right nasty. The path to doing business with them is littered with the corpses of would be customers. They've earned the reputation of the most hated organization in the world; they've really had to work at it to get top title. Now very few buy albums anymore. The practice of filler has so made that one song you really wanted far too expensive when you had to buy an album to get it. It was so overvalued, that people now have returned to the days of buying the single. Then there is the deal with the devil that they made with chain stores. Used to be everywhere across this nation were mom and pop record stores that are no longer in existence. They were the victims of the discounts for volume sales. Unlike chain stores, mom and pop stores had three and four times the amount of artists and records to choose from. But they couldn't compete with the price these chain stores sold music at. That in turn made chain stores the most popular place to buy music across the nation. Chain stores want to see merchandise move. Anything that sets on the shelf very long is costing them money as they see it. So nothing but the top hits that will move. Plus chains don't devote a whole store to music. You have so much floor space devoted to music and that's it. What that did was lower the availability of music to the public. You can't do that and make an increase in income. There is also the reaping of bad publicity through the claiming that piracy is the main cause of loss of record profits, as in selling more than ever before. Piracy has been the scapegoat for refusing to modernize business practices. They are like someone that insists that the problem with theft isn't their own security and responsibility but rather everyone around them should pay for increased security for them so they can leave their windows down in the car and it unlocked, expecting always for their items to remain in the vehicle. No one in their right minds does that if they want to keep their goods. And we end up with the idea that all these court cases, the shackling and shutting down of websites, have led people not to want to buy anymore because of the demand that it be used as the owners see fit. That's not why people buy music. All of this has led to the shrinking of the music industry as it consolidates into an ever smaller part of the music world. Indies are doing fine. It's not that people won't buy; but they've learned over time that buying from the official sources that restrict you to returning every month or two to re-approve you listening to your own music, isn't always dependable. A business goes bankrupt, the buyer lost their library. It's not encouragement to continue buying. Well we're down to three major labels and EMI wants out. They want someone to buy them. Which at some point will make it two major labels. No one cried much when the ice deliverer came by daily or so to bring ice for refrigeration lost his job to the real refrigerator. Likewise I won't cry; in fact I will instead applaud, when the last major label goes bankrupt. Maybe what rises from the ashes will be worth the wait. |
Re: RIAA Revenue Dwindles As Labels Cut Back
Totally agree with what you are writing, Photostill.
When you buy music, how much is going to the artist. Most of the money ends up in the deep pockets of the record company executives. These people all went to law and business, management university and don’t have one bit of musical creativity in their body. The real artists get their money by performing live, on stage. One last thing, most of the recent music in these billboards and hit parades is crap that nobody wants to buy. It is a copy of a copy of a copy and maybe nice to hum as a tune but not worth any money. |
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