Clarification re "Accounting Ugliness"
A point of clarification for the DMN article on YouTube artist accounting. The way things work in the world of distribution licensing is that the record company, digital aggregator or music publisher (or society) relies on the distributor to give them adequate sales reporting data on a track by track basis. Along with that sales report comes a single check, and the recipient of that check has to break it down and render accountings to their artists, distributed labels or artists, and writers (or publishers).
The distributor needs to give reasonably detailed sales reports so that the record company, digital aggregator or music publisher (or society) can render those statements. Otherwise the check that is received is never distributed or could be improperly distributed.
When faced with a distributor in a country that doesn't share basic ideas about private property, that is difficult to sue, or where the distributor is trying to avoid payment for a host of reasons, the typical practice is to get the biggest advance you can, and then hope for the best when it comes time to account. Call it "crook insurance." This happens most frequently in third world countries, but we are now seeing it in that third world country that exists in the middle of a first world economy--aka the Internet.
So if a distributor is trying to at least pretend they are running a legitimate business, it is not enough to point fingers at record companies, digital aggregators and music publishers who are not provided the proper information with which to render statements.  Whatever accounting problems the labels may have, it is a little hard to believe that ALL of the accounts--big and small--are playing hide the ball at the same time and just with the YouTube money. That line of argumentation only works with the 13 and under crowd.
So put that in your SOX and smoke it.
- Posted by ccastle posted at 2008-03-12 10:16
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