RSSMuzu strives for fair music video compensation
By Tim Conneally | Published May 6, 2009, 7:47 PM
Since launching in beta last July, Ireland-based music video site Muzu.tv has secured a decent amount of recognition for its monetization priorities. The site gives 50% of the net ad revenue generated by an artist's content back to the artist (or label) without any exclusivity contracts.
Banner ads and in-video advertisements are embedded in an artist's content in the Muzu player, which is itself embeddable in sites like MySpace, Facebook, and Twitter. Anybody or any band can create a channel on Muzu dedicated to their personal music, and monetize their video content. While monetization has been somewhat problematic on YouTube, the option to make money there does exist.
Muzu takes exclusivity to a different level. The site will digitize old film and video content in exchange for exclusive hosting rights, and it even has a studio in Dublin where artists can freely film their own live shows for exclusive broadcast on the site. Record labels have thus far been keen on the deal, and Muzu now hosts content from majors Sony BMG, Universal Music Group, and EMI, as well as legendary indie labels 4AD, Matador, XL, and Rough Trade.
Guardian UK blogger Helienne Lindvall praised Muzu in April, and likened it to a Fair Trade coffee producer, where just compensation is given to those most commonly exploited.
Of course, like all money making deals in the music business, it's the math that ends up compensating for all that fairness.
While it is true that the site has been forthright with its monetization and distribution, the 50% of net revenue promised is actually considerably less. In reality, it is more like 30% because Muzu subtracts 20% of the net to cover bandwidth, storage, and payment processing. Another deduction is taken to compensate the rights societies (ASCAP, BMI, MCPS, and PRS, for example) through which most royalties must be piped. So artists will generally receive less than a third of every Euro made.
Lastly, if the inclusion of the currency didn't give it away already, payments require an international bank account (BIC/IBAN). This renders Muzu monetization effectively off limits to unsigned United States artists due to this country's incompatible banking system, unless they belong to that rare brand of starving artist that also has an offshore account.
Hi all. I'm with MUZU and just wanted to offer a couple of clarification points.
MUZU will pay unsigned bands via their Pay Pal accounts. This functionality will be availble in Q3 2009 and any money earned by bands will accrue and be paid once this is setup.
Also, just to clarify the revenue and deductions (preinterpost -- we don't skim off 50% as pure profit!):
MUZU splits net revenue received 50/50 with the artists. As Tim correctly points out we pay the collection societies - this comes off the top first prior to any take by MUZU, and is paid on to the songwriters as 'royalties' by the collection societies. This is typically 8%, but may change depending on whatever rate the industry sets. This is a good thing for songwriters, and does not go into the pockets of MUZU.
20% is then deducted to cover costs directly associated with the storing, bandwidth, video ad serving fees, global streaming of artists' video content (not other company overheads). The reality is that the costs are actually a lot higher than that, but MUZU takes the hit. Without a deduction to cover these costs services like MUZU would not be sustainable. The resulting net 72% is split 50/50 with the artists. We believe this is a fair and equitable offering.
MUZU also provides a slew of value added services to bands, including free video digitisation, marketing support and free usage of the MUZU recording studio, where we shoot videos for free for unsigned bands - we also provide free editing, and lend out the studio space whenever we can. I guess the point I'm making is that MUZU is very artist friendly and is a music company first and foremost. Check out some of the free videos we've done for unsigned bands here:
http://www.muzu.tv/muzusessions
Cheers,
Graeme.
Score: 0
|If skimming off 50% as pure profit (not even including services) I must have woken up in the wrong reality this morning.
Score: 0
|