New ideas about recording contracts in Philadelphia
Tom Deacon
THE WALL STREET JOURNAL
'Masters of Their Masters'
By BARRYMORE LAURENCE SCHERER
New York, July 21, 2005
Recently, the Philadelphia Orchestra announced a three-year contract with
Ondine Records, an adventuresome independent label based in Finland. The
contract, which includes a yearly extension option, stipulates the release
of a minimum of three recordings each year, with the first scheduled for
this autumn. Each will be selected from live concerts, then edited and
produced by the orchestra. Ondine will manufacture the finished recordings
and distribute them internationally.
Planned repertoire for these new CDs combines familiar and unfamiliar
scores. Apart from Tchaikovsky's Fifth Symphony, the orchestra's eighth
recording in 71 years, and Bartók's Concerto for Orchestra, recorded thrice
under Eugene Ormandy, other works under consideration include parts of the
orchestra's multiyear Mahler cycle, Gideon Klein's Partita for Strings, and
Bohuslav Martinu's searing "Memorial to Lidice." In addition, Philadelphia's
music director, Christoph Eschenbach, will make his first major solo piano
recordings in 30 years -- six movements from Tchaikovsky's piano cycle, "The
Seasons."
The importance of this contract is twofold: For Philadelphia, it is its
first recording contract in 10 years, a situation symptomatic of the current
difficulties faced by American orchestras. Indeed, when Mr. Eschenbach
assumed his post in 2003, the resumption of a regular program of recording
was among his chief priorities. In part the path had been laid by Mr.
Eschenbach himself, as he has been on Ondine's roster for several years,
recording with the Orchestre de Paris, of which he is also music director.
Equally important, ownership of the recordings will reside with the
Philadelphia Orchestra rather than Ondine. Hence, this contract departs
radically from the traditional relationship between major American
orchestras and their recording labels.
For much of the 20th century, each of America's so-called "big five"
orchestras -- the New York Philharmonic, Boston Symphony, Chicago Symphony,
Cleveland Orchestra and Philadelphia Orchestra -- enjoyed long-term
contracts with major labels. Whether it was RCA Victor, Columbia
Masterworks, Deutsche Grammophon, EMI or Decca, the label called the shots.
Sometimes royalties would start immediately, sometimes only after the
break-even point -- though the most typical was an advance plus royalty for
a soloist, and flat session fees for the orchestra.
By the turn of the new century, however, the "big five" and other major
American orchestras found themselves casualties of drastic cost-cutting by
the labels in response to declining sales following the classical CD boom of
the 1980s (when serious collectors world-wide replaced their vinyl LPs with
the then-new technology). Those long-term contracts became a memory, and
when interviewed about this and other aspects of this touchy subject,
major-label executives all preferred to speak anonymously.
"The reason for huge losses is huge flat fees for orchestras," says one
European executive. "But these are quickly disappearing." According to one
former executive, "Major labels won't touch most major American orchestras
because their recording costs are double those of European orchestras, and
because restrictive union rules make the sessions themselves less productive
than European sessions."
To make matters worse, labels traditionally decide which recordings to keep
in print. So in recent years America's big five found their newer releases
going out of print while archival recordings of, say, Chicago with Fritz
Reiner, Cleveland with George Szell, New York with Leonard Bernstein, and
Philadelphia with Mr. Ormandy remain catalog staples. "The Philadelphia
Orchestra Association still receives several hundred thousand dollars
annually in record royalties from our Ormandy recordings," says the
orchestra's president and CEO, Joseph Kluger. "Our [more recent] recordings
do not earn much, if anything, because payments made to musicians must be
recouped from royalties." Nevertheless, even for recordings not deleted from
the catalog, royalties usually have yet to be earned.
"Whether you're talking about an orchestra or a solo musician, when a label
deletes a recording, prestige is damaged and careers can be halted, even
destroyed," says Kevin Kleinmann, who engineered the new Philadelphia/Ondine
agreement along with the label's founder and president, Reijo Kiilunen. A
French citizen based in Paris, Mr. Kleinmann, 49, teaches the business of
recording at the Sorbonne, basing his theories and practices on 27 years'
experience in the classical-music field. He was, successively, marketing
vice president of CBS Masterworks, international vice president of Philips
Classics in the Netherlands, managing director of Polygram Classics, France,
and vice president of Polygram Classics International in London. He also
served as acting president of Deutsche Grammophon in Hamburg.
Mr. Kleinmann declares that the only way to ensure the survival of the
classical recording industry "is to redefine the traditional roles of
artists and labels. In the current set-up, the artist usually plays a
completely passive role....Artists are often the victims of arbitrary
decisions to delete their recordings or alter them in compilations that are
not in the artists' best long-term interest."
Mr. Kleinmann believes that artists should own their original recordings,
becoming "masters of their masters, while the recording companies should
evolve into managers of this musical equity." Comparing this relationship to
that between an investor who owns a portfolio of equities and the broker who
manages the portfolio to maximize its full potential, he says that the
broker/label bears the burden of results, and at the end of a contractual
period, the client/artist decides whether the broker/label has performed
satisfactorily.
In this plan, recordings could be funded by the artist, by sponsors, or -- a
new idea -- by artist investment firms, which would take a stake in an
artist and share in the profits generated, with ownership always remaining
with the artist. Should the artist choose to distribute a given recording in
a different way, after an agreement with the "broker" terminates, "the
artist is free to keep a given recording alive, either through a deal with
another company or through online sales, etc."
Mr. Kleinmann presented his case very persuasively in a recent phone
interview, but major-label executives I spoke with were skeptical. "The most
common reason why deals are beginning to emerge where ownership stays with
the artist is that a label is not able or willing to pay for recordings and
for artist development," says one exec. "But they are in reality acting
merely as distributors, and doing this job in exchange for virtually free
material."
Another label executive acknowledges that "if you look at the number of
records being released currently, the vast majority are on 'indie' labels,
whose flexibility can allow them to work well with this new relationship."
However, he observes that "at our label the archive is a major holding that
represents a long history with a great many artists and organizations. A lot
of classical records don't earn money for a long time -- in some cases...20,
30 or even 50 years....Therefore, it makes sense for us to own the masters
so that the money we invest in a recording and its promotion isn't wasted in
the long term."
It remains to be seen if Mr. Kleinmann's theories will revolutionize the
classical recording industry. But one thing is certain: It will be good to
hear the Philadelphia Orchestra on disc again.
Mr. Scherer writes about classical music for the Journal.
Thornhill
Two points:
As the article says, I doubt major labels will ever adopt this practice
since they make most of their money from endlessly
reissuing/repackaging recordings, even when they entire public domain.
Their new business model seems to be 75% reissues, 5% cross over, and
10% new recordings by a few high profile artists and ensembles.
Seeing how much people shell out for OOP recordings on ebay, they
should develop an on-demand system for buying them. For $20 they could
mail you a CD-R dupe and email you the cover art/liner notes as a PDF.
Matthew B. Tepper
letters to be typed in
news:1122223920....@g43g2000cwa.googlegroups.com:
> FYI: a Mahler 1 recorded on tour will be released.
>
> Two points:
>
> As the article says, I doubt major labels will ever adopt this practice
> since they make most of their money from endlessly reissuing/repackaging
> recordings, even when they entire public domain. Their new business model
> seems to be 75% reissues, 5% cross over, and 10% new recordings by a few
> high profile artists and ensembles.
>
> Seeing how much people shell out for OOP recordings on ebay, they should
> develop an on-demand system for buying them. For $20 they could mail you
> a CD-R dupe and email you the cover art/liner notes as a PDF.
I disagree with your pricing. A downloadable ISO file and booklet in .PDF
format together are worth $5. A mailed CDR plus the .PDF are worth $10.
And a pressed CD, with a printed booklet, in a jewel box, shrink-wrapped,
are worth no more than $18.99. $20, I simply WILL NOT PAY.
--
Matthew B. Tepper: WWW, science fiction, classical music, ducks!
My personal home page -- http://home.earthlink.net/~oy/index.html
My main music page --- http://home.earthlink.net/~oy/berlioz.html
To write to me, do for my address what Androcles did for the lion
Take THAT, Daniel Lin, Mark Sadek, James Lin & Christopher Chung!
Vaneyes
Thornhill wrote:
> Two points:
>
> As the article says, I doubt major labels will ever adopt this practice
> since they make most of their money from endlessly
> reissuing/repackaging recordings, even when they entire public domain.
> Their new business model seems to be 75% reissues, 5% cross over, and
> 10% new recordings by a few high profile artists and ensembles.
>
> Seeing how much people shell out for OOP recordings on ebay, they
> should develop an on-demand system for buying them. For $20 they could
> mail you a CD-R dupe and email you the cover art/liner notes as a PDF.
One point. Kleinmann pipedream.
Regards
Thornhill
for you) for $25. I believe they stopped when Universal took over
DG/Philips/Decca.
Universal launched a pilot program, like two years ago, which did this,
but it putterd out because of limited selection and liner notes were
not provided in any way. I think the price per disc was like $20.
Matthew B. Tepper
@g44g2000cwa.googlegroups.com:
Exactly. They stupidly did not realize the resistance to the price, and
must have been shocked when it failed (as I could have told everyone at the
time, and perhaps did at that). What boggles the mind is that Vox deemed
itself a premium label on the same level with DGG, Philips, and Decca, and
was trying to charge the same thing for the same meager product.
What the idiot accountants and their lapdog executives fail to take into
account is that there ARE people who want the pride of physical ownership
of a nice collectible OBJECT, not just some data they can put onto some
device and then erase later when they get tired of it. And a CDR is just a
step above the phantomlike hard drive sectors with some ones and zeroes.
Steven de Mena
"Matthew B. Tepper" <oy兀earthlink.net> wrote in message
news:Xns969DAE0BA94...@207.69.189.191...
> What the idiot accountants and their lapdog executives fail to take into
> account is that there ARE people who want the pride of physical ownership
> of a nice collectible OBJECT, not just some data they can put onto some
> device and then erase later when they get tired of it.
I do too, but I think we are in a shrinking majority in this respect.
Steve
Thornhill
instead for die hard collectors who **very much** want a recording that
is out of print and are willing to pay as much as $40 or $50 for it on
ebay. The price is high because it is a premium service.
Matthew B. Tepper
> These on-demand services were never intended for the mass market, but
> instead for die hard collectors who **very much** want a recording that
> is out of print and are willing to pay as much as $40 or $50 for it on
> ebay. The price is high because it is a premium service.
And they failed at that high price; so what does that suggest?
Steven de Mena
> "Thornhill" <seth...@gmail.com> appears to have caused the following
> letters to be typed in
> news:1122274543.4...@g43g2000cwa.googlegroups.com:
>
>> These on-demand services were never intended for the mass market, but
>> instead for die hard collectors who **very much** want a recording that
>> is out of print and are willing to pay as much as $40 or $50 for it on
>> ebay. The price is high because it is a premium service.
>
> And they failed at that high price; so what does that suggest?
That is presuming price is why it failed. Maybe it wasn't marketed properly?
Or maybe they should have partnered with a bricks and mortar store, or
Amazon?
Steve
Thornhill
reasons: no one knew about it, limited selection (as well as not
offering recordings that consumers wanted), no liner notes, and on top
of that, price.
I believe the German store only stopped because their arrangement with
DG/Philips/Decca changed when Universal took them over.
Norman M. Schwartz
> letters to be typed in
> news:1122274543.4...@g43g2000cwa.googlegroups.com:
>
>> These on-demand services were never intended for the mass market, but
>> instead for die hard collectors who **very much** want a recording that
>> is out of print and are willing to pay as much as $40 or $50 for it on
>> ebay. The price is high because it is a premium service.
>
> And they failed at that high price; so what does that suggest?
>
OOP items on Ebay, etc. or the record companies will re-issue them at
"budget" prices.
Matthew B. Tepper
following letters to be typed in news:GxqFe.14430$_x.1...@fe11.lga:
Indeed. They're *supposed* to issue them at budget prices.
--
Matthew B. Tepper: WWW, science fiction, classical music, ducks!
My personal home page -- http://home.earthlink.net/~oy/index.html
My main music page --- http://home.earthlink.net/~oy/berlioz.html
To write to me, do for my address what Androcles did for the lion
Hey spammers, look what happened to Vardan Kushnir. You're next!
Dana Hill
> "Thornhill" <seth...@gmail.com> appears to have caused the following
> letters to be typed in news:1122246979.377027.114010
> @g44g2000cwa.googlegroups.com:
>
>> A german company used to do this (they would photocopy the liner notes
>> for you) for $25. I believe they stopped when Universal took over
>> DG/Philips/Decca.
>>
>> Universal launched a pilot program, like two years ago, which did this,
>> but it putterd out because of limited selection and liner notes were
>> not provided in any way. I think the price per disc was like $20.
>
> Exactly. They stupidly did not realize the resistance to the price, and
> must have been shocked when it failed (as I could have told everyone at
> the
> time, and perhaps did at that). What boggles the mind is that Vox deemed
> itself a premium label on the same level with DGG, Philips, and Decca, and
> was trying to charge the same thing for the same meager product.
>
> What the idiot accountants and their lapdog executives fail to take into
> account is that there ARE people who want the pride of physical ownership
> of a nice collectible OBJECT, not just some data they can put onto some
> device and then erase later when they get tired of it. And a CDR is just
> a
> step above the phantomlike hard drive sectors with some ones and zeroes.
>
I am in complete agreement. The Classics on Demand program Universal
started was a pale shadow of their original idea, which was in development
around 2001 or so, and called "Built to Order", IIRC. Originally they
planned to make a large number of OOP titles available with liner notes and
tray inserts. There would be essentially no perceivable difference between
the copy and the original from my understanding. They had a date set for
launch and then cancelled. I recall reading that something fell through
with the company that was to do the manufacturing.
When you see old DG, Decca and Philips titles fetching so much money on eBay
it might make you think that a program like the one they had in place would
work. But the collectors who pay $100+ for a Haitink Bruckner 7 are doing
so because they want the actual item with the notes and the inserts in a
jewelcase, not a photocopied track list. I understand because I am the same
way. I have a library of many, many thousands of CDs at my disposal, and I
could easily take any of them home to copy them and file in them notebooks.
Why have I never done this, and why do I go out of my way to find my own
copy of the discs I want? Because I want the physical item with the
libretti and the slipcases and the informative essays.
If some enterprising label could utilize technology and offer this service,
I wouldn't hesitate to pay $20 for a CD, if it kept me from paying $65 on
eBay.
--
Dana Hill
Gainesville, Florida
Photography: www.danajohnhill.com
Personal: www.danajohnhill.org
Norman M. Schwartz
"Dana Hill" <danaha...@danajohnhill.com> wrote in message
news:dc5lnd$79m$1...@spnode25.nerdc.ufl.edu...
>
> When you see old DG, Decca and Philips titles fetching so much money on
> eBay it might make you think that a program like the one they had in place
> would work. But the collectors who pay $100+ for a Haitink Bruckner 7 are
> doing so because they want the actual item with the notes and the inserts
> in a jewelcase, not a photocopied track list. I understand because I am
> the same way. I have a library of many, many thousands of CDs at my
> disposal, and I could easily take any of them home to copy them and file
> in them notebooks. Why have I never done this, and why do I go out of my
> way to find my own copy of the discs I want? Because I want the physical
> item with the libretti and the slipcases and the informative essays.
>
CD-Rs, (I have at least three of them, some purchased after they realized it
wasn't going to sail and offered them at a lower price), how are you going
to sell them off, Ebay, a used record shop; I don't think so. Without
inserts or spines, I have to file them in the tomb of the unknown CDs.
Matthew B. Tepper
following letters to be typed in news:njAFe.3459$Kx6....@fe12.lga:
Damn straight. Remember five years ago, when a bunch of us here responded
to a special offer from Music and Arts on the Furtwängler/Scala _Ring_?
Some of us got sets with one disc missing, and another duplicated; I was
offered a burned copy of the missing disc, but I held firm for the thing
that I had actually paid for. A burned CD has -0- resale value.
--
Matthew B. Tepper: WWW, science fiction, classical music, ducks!
My personal home page -- http://home.earthlink.net/~oy/index.html
My main music page --- http://home.earthlink.net/~oy/berlioz.html
To write to me, do for my address what Androcles did for the lion