1. Advantages of using
Turmic Records instead of going to download sites directly.
2. Advantages and Disadvantages
3. I’d rather go directly to these
sites.
4. Can the agreement be terminated? Isn’t
ten years a long time?
5. Why do I have to send 3 CD’s to
NY?
6. What does Non-Exclusive mean?
7. Out of Pocket Costs
8. Who pays the Mechanicals?
9. How do we know that you are getting
the best rates from the download sites?
10. What if a label picks us up? What
if a Major comes along?
11. Shouldn’t I be signed to a label
first? We want to wait until we have a record company.
12. Will promotion on these sites really
help us? Will you promote us? How much time will you
put into us? How will you have time for so many artists?
Do you guarantee sales?
13. We already have distribution is some
of the territories
14. Why should I pay you? Is it really
worth it?
15. What about Jazz and Classical? How
does the pricing work?
16. Why do you want our crummy demo song?
17. Why go through Turmic Records instead
directly through The Orchard?
18. Why haven’t I been paid anything
yet?
19. If we sign a deal with Turmic Records
will we automatically be represented by Stellar Artist
Management?
20. Is it just the material we send in
that is bound by the agreement?
21. Will you also take a percentage of
our publishing (Stim/BMI/Koda/ASCAP)?
22. Will you also sell our CD’s
or other physical products?
23. How does the breakdown from the site
to my pocket look?
24. Why does the balance have to get up
to $50 before we receive payment?
25. Why aren’t our songs on ALL
the sites?
26. How do I know what sites we’re
on?
27. What rights would we be giving away?
28. What is the deal with the Film &
TV Library?
29. What is a DMS
30. What does DSP mean?
31. What does DMC mean?
32. What is DRM?
33. Understanding Digital Transaction
Types
34. Will you let me know
what stores my release is available in?
35. How long does it
take to show up on the music services once you deliver
it?
36. How are sales payments
reported?
37. How long does it
take for you to send it to all the companies?
1.
Advantages of using Turmic Records instead of going
to download sites directly.
The advantage of going through us versus
going to iTunes or the other over 100 important sites
directly is that you will actually be available at these
sites if you work with us. Good luck trying to go direct.
Even if you successfully negotiate a deal you still
have the issue of encoding, delivery and ingestion.
After that you need to develop a relationship with the
programming staff so that your music gets placement
on the site. And you have to do this for over 100 of
the major digital music services like Napster, MyCoke,
Virgin, etc.
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2.
Advantages and Disadvantages
Advantages of going direct:
• 100% of sales income
• Complete control over catalogue
• Short term
Advantages of working with The Orchard/Turmic Records:
• The Orchard actively markets to digital music
stores and has direct relationships with music programmers.
The Orchard knows what promotional opportunities are
available at each store and how to set them up. Most
labels won’t be able to set up direct relationships
with key programmers.
Marketing increases sales. A featured placement on a
main page or genre page typically increases sales by
10 times. We put Fierce Panda on the main page of iTunes
and the Coldplay tracks were the 2nd most downloaded
tracks on the site. When we took them off, they fell
out of the top 100.
• Not paying The Orchard their 30% of 100 leaves
you the full 100. Paying 30% of 1000 leaves you 700
• Encoding and delivery. The Orchard takes care
of all encoding and delivery whether handling it in
house or utilizing the services of other companies such
as Rights Router and CI.
• Speed to market. The average time it takes for
music to be available in the digital music services
is less than 8 weeks.
In essence, we are saying that in most cases working
with the Orchard will increase income for labels. Even
though we take a percentage of sales, we save a label
money.
• We pay upfront costs for encoding and delivery
• We increase sales opportunities
• We take care of accounting which is probably
the largest hidden cost in the equation
• We handle most functions in the digital space
so that the label does not need to staff these positions.
They just need to work with us like they would with
a retail store like Tower Records. They tell us their
priorities and we work them.
Income from digital sales will be modest over the next
3-5 years. The Orchard can turn a cost center into a
revenue center for indie labels.
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3.
I’d rather go directly to these sites.
I firmly believe there is a critical
role for digital distributors that is even far more
important than traditional physical distributors. On
of our partners, The Orchard, put Fierce Panda on the
main page of iTunes and the Coldplay tracks were the
2nd most downloaded tracks on the site. When they took
them off, they fell out of the top 100. Unless you know
someone personally at these sites, good luck influencing
them in any way when you get something going…
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4. Can the
agreement be terminated? Isn’t ten years a long
time?
No, the agreement can not be terminated
unless you are signed by a label. If you are signed
up by a label both The Orchard and the artist/label
can assign the agreement if they are purchased. This
is very normal and straight forward. This in no way
impacts the rights and obligations of either party.
Regarding 10 years, the problem we face is that we will
spend a considerable amount of time and resources both
setting up your account as well as marketing your releases.
As we all know, the digital download revenues in the
next couple of years will still be modest and it is
unlikely that we could recoup our initial costs in such
a short term. Additionally, we will be introducing your
music to the key music programmers and marketing teams.
We don’t want to do this work if we won’t
be around to share in the fruits of our labor.
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5.
Why do I have to send 3 CD’s to NY?
One copy is used to encode your songs
for use on the DMS's, one copy is kept in-house for
use by our merchandising team, and one copy remains
safely in The Orchard's off-site archive warehouse as
a back-up.
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6.
What does Non-Exclusive mean?
Non-exclusive – Accounts are
always exclusive with distributors. Ask any CD distributor.
Once they establish an account they don’t want
someone else servicing it with the same product. The
people that enforce this the most are the retailers
themselves. It complicates their business if two companies
are servicing them with the same release.
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7.
Out of Pocket Costs.
Out of Pocket Costs – means exactly
what is says. If there is a specific cost we have to
pay related to the sale of the recordings it will be
deducted. Right now the only costs are encoding and
delivery and the handling and wiring of your money from
sales.
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8.
Who pays the Mechanicals?
The mechanical royalty is, on average
around the world, 8% of the retail price of the download.
With the exception of the US, all digital music services
pay the mechanical royalty directly. For the US, one
pays their local society in their home country. You
will receive a report from us. It’s pretty easy
to handle.
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9.
How do we know that you are getting the best rates from
the download sites?
It is in our best interest to use our
leverage in negotiating the highest rates possible.
And we do. It is not in our best interest to secure
a low rate since the only money we make is from our
distribution fee. Our average rate is between 60-70%
of the retail price which is about the same as the Major
Labels.
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10.
What if a label picks us up? What if a Major comes along?
Both the Orchard and the artist/label
can assign the agreement if they are purchased. This
is very normal and straight forward. This in no way
impacts the rights and obligations of either party.
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11.
Shouldn’t I be signed to a label first? We want
to wait until we have a record company.
Probably the best way to get a label
interested is to show them that there is interest in
your music, and the only way to do that is to put it
out there. We don't sign anyone to our label without
proof of sales. The majors want proof of sales 99% of
the time. In the old days bands were signed according
to what potential a label thought they had. Often that
was an artistic decision. Today, because digital distribution
has become so available, record companies are mainly
looking for bands with track records in sales. Let's
face it, if you were a label and hundreds of bands were
sending you hundreds of demos, which band would you
pick: The band with great songs that had sold 15,000
downloads on iTunes or the band with great songs that
hadn't sold anything because they were waiting for a
record deal?
My point is that if you are looking
for someone to promote you, get a track record and make
a few bucks while you're at it. Worst-case scenario
is that you impress your fans by being on all the most
important download sites.
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12.
Will promotion on these sites really help us? Will you
promote us? How much time will you put into us? How
will you have time for so many artists? Do you guarantee
sales?
Naturally we can’t promote all
the bands we have all the time. BUT if things start
to happen for you, then you have someone to contact
and let them know. Try doing that directly with iTunes
or MSN or any of the large sites we deliver to. The
Orchard speaks with the programmers of these sites on
a daily basis and runs 100 to 150 promotions every day,
so even if we can’t guarantee a blinking banner
on the front page of iTunes, you will have at least
someone to get a hold of when it’s time to push
your hit single. But you should know that you are still
responsible for marketing your act. It is not the job
of a distributor to create demand for your product.
You still need to head up that front.
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13.
We already have distribution is some of the territories.
If you give us a list of all the sites
you are presently on, we will not disturb your presence
there. We will help you cover the rest of the world.
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14.
Why should I pay you? Is it really worth it?
It's a small fee when you consider
that you get your CD into all the over 100 most important
sites in the world. If you do it yourself you will spend
an enormous amount of time dealing with all the administrative
work for each site, encoding for each site, meta-tagging
for each site, accounting for each site, etc. We do
it all for less than fifty cents per site. All our artists
are also automatically considered for entry into our
film & TV media library database. If accepted, you
will receive a separate offer.
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15.
What about Jazz and Classical? How does the pricing
work?
The deals that we have in place with
the major DMS’s do not allow us to select pricing
per track or album. All of our releases are sold as
what they call “frontline” which differs
on each store (usually about $9.99 per album and $.99
per track). However, if a particular album contains
less than 10 songs, the full album price would be the
amount of tracks multiplied by $.99. Again, each DMS
has their own policies but on iTunes, if a track is
over 10 minutes in length, it is not available for an
individual track download (only full album download).
Although we do not have the power to control the sales
price per track, we do have the ability to control full
album or track by track availability (i.e. if an artist
does not want each track to be available individually
or does not want one specific track to be available
or only wants to offer full album etc.)
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16.
Why do you want our crummy demo song?
We are not here to judge your music.
That’s because we believe that everyone is entitled
to non-exclusive worldwide distribution. Isn’t
that the whole idea with the Internet? We don’t
need to be pickier than you because your music isn’t
stored on shelves or shipped in large containers anymore.
Since the cost of storage is so low, we are willing
to take the risk on your music, and basically we trust
that most people wouldn’t spend the money on the
initial fee if they didn’t feel that there music
was worth it. By working this way we don’t have
to be experts in every genre and sub-genre – nor
do we need to be the great visionary that maybe you
are. We enable artists to have as much artistic freedom
as possible. We’d rather let the public decide
rather than some cigar-smoking executive. We don’t
like the smell of cigars anyway! Having said that, the
production quality needs to be of a certain level, so
we weed out product that we don’t feel is technically
viable.
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17.
Why go through Turmic Records instead directly through
The Orchard?
The reason why artists go through Turmic
Records instead of going directly to The Orchard are:
1. It gives an artist/group the chance
of having contact with a label, and in some cases can
lead to a signing.
2. We have an added interest of having “our”
artists succeed because we profit directly from that.
3. Once an artist is in our database, they receive special
offers that non-Turmic artists do not receive such as:
opportunities to take part in compilations, send-outs
to labels, send-outs to music supervisors, film and
TV placement, etc. (Separate agreements are made with
artists who are eligible for these benefits.)
4. And perhaps most importantly, our agreement is limited
to ten years while The Orchard’s is limitless.
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18.
Why haven’t I been paid anything yet?
At this point, you have not reached
the minimum necessary per quarter to be paid by the
Orchard (US$50). If you can continue to promote the
release and encourage fans to buy, you will increase
your sales overall and easily make the minimum.
If you have any further marketing information that you
can provide to us to help sales, or if you have new
releases available we'd love to get them out there.
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19.
If we sign a deal with Turmic Records will we automatically
be represented by Stellar Artist Management?
Though we offer a number of the artists
we distribute the possibility of participating in some
of the compilations we send to film and TV production
companies as well as other services, no artist is guaranteed
an offer of management from Stellar Artist Management.
These are two separate companies.
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20.
Is it just the material we send in that is bound by
the agreement?
Our agreement is non-exclusive, so
you do not have to give us all your tracks. However,
once we assign one of your tracks to one of our download
sites, you may not distribute your tracks to them yourself.
We want to avoid a situation where we introduce one
track of your music to the key music programmers and
marketing teams, and then you deliver several tracks
- piggybacking our deal. I’m sure you agree that
it wouldn’t be fair to do that.
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21.
Will you also take a percentage of our publishing (Stim/BMI/Koda/ASCAP)?
We do not take a portion of your publishing
unless we have entered into a publishing deal with you.
It is not part of the distribution agreement.
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22.
Will you also sell our CD’s or other physical
products?
We only distribute your music digitally
(as stated in the agreement). We will not sell physical
CD’s or DVD’s or Tapes or LP’s unless
we enter into a physical distribution deal with you
separately.
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23.
How does the breakdown from the site to my pocket look?
Here is an example of how digital distribution
payment works:
One of your tracks is purchased on a download site for
$0.99
The download site pays The Orchard $0.63
We pay you 70% of $0.63 = $0.44 per download.
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24.
Why does the balance have to get up to $50 before we
receive payment?
Most artists understand that it is
not worth the administration costs to send so little
money at a time. Remember, you pay the fees (Out of
Pocket Expenses) associated with wire-transfers so this
is actually for your benefit. In the end you make more
money because you have fewer fees. If you, for instance,
have $12.00 in your balance at the end of the term,
we will send that to you.
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25.
Why aren’t our songs on ALL the sites?
Basically what happens is that we send
out every release that we have to all of our partners,
and it is ultimately their decision what they post.
That doesn’t mean that all of these sites have
denied posting your music, as many of these sites have
more limited capabilities and it can sometimes take
a long time to get new material up. They also will be
focusing more on getting the top selling albums uploaded
before they worry about anything else. Therefore the
answer is that it will either take more time, or that
they have decided not to post the material.
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26.
How do I know what sites we’re on?
We do not have a list of the sites that your music is
on. Unfortunately, The Orchard does not receive a checklist
when one of the sites they distribute to adds a new
artist. You can imagine that the administration for
that would be enormous. I would say that the best way
to find out is to methodically go to each site. Here’s
the link to the list: http://www.theorchard.com/marketing/list_of_dms_partners.htm
and take notes. Naturally if it is a punk music site,
don’t expect them to carry your smooth jazz CD?
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27.
What rights would we be giving away?
None. You keep all your rights. You
keep all your publishing. We just license your tracks
to sell in all the ways described in the agreement during
the period of the agreement.
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28.
What is the deal with the Film & TV Library?
Media Library:
Stellar Artist Management ApS, in collaboration with
Turmic Records, pitches music to film and television
directors, producers and music supervisors as well as
advertising agencies.
Placement:
One of the best ways for an artist to earn income and
notoriety from their music is to be “placed”
in a film, TV show or advertisement. This is often a
complicated process with fast-paced negotiations. We
have both a large catalog in order for buyers to be
interested in our product, and the expertise in order
to make sure that you get a fair deal. We handle all
the administrative procedures as well as the negotiations.
For this service we take fifty percent of the gross
income earned.
Fees:
The one-time fee for the administrative cost of being
added to our Media Library of EUR65.00 for non-Turmic
Records Distribution clients and EUR35.00 for Turmic
Records Distribution clients. There is also a EUR2.85
charge per track per year. We decide which tracks we
find suitable for film, TV and advertising placement,
and you decide which ones from the ones we choose. So,
if we like six tracks of your ten-track album, you then
decide which of those six - or all - you would like
to enter.
Agreement:
You will receive a formal agreement once the initial
tracks are agreed upon.
Interest:
Interested? Let me know with a mail with "Interested
in licensing my music to the Media Library" in
the subject line.
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29.
What is a DMS?
DMS is the abreviation for Digital
Music Store. (i.e. iTunes, MSN Music, etc.)
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30.
What does DSP mean?
A DSP is a Digital Service Partner
or Digital Service Provider. (i.e. iTunes, MSN Music,
etc.)
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31.
What does DMC mean?
DMC is an abreviation for Digital Music
Content.
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32.
What is DRM?
DRM is an abreviation for Digital Rights
Management. Read more about DRM here:
http://www.microsoft.com/windows/windowsmedia/drm/default.aspx
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33.
Digital Transaction Types
DT: Downloaded Track.
A downloaded track is a music file that is transferred
from a Digital Music Service's remote server to a user's
computer. In most cases, a downloaded track can be burned
to a CD or portable listening device.
DA: Downloaded Album.
A downloaded album is the same as downloaded track,
but applies to an entire album.
S: Stream.
A stream is a single music file [track] that the user
plays directly from a remote server without transferring
it to his/her computer.
DR: Downloaded Ringtone.
A ringtone is a downloaded track that a user can add
to the menu of ringing melodies on his/her mobile phone.
TD: Tethered Download.
A tethered download is a downloaded track that a user
cannot burn to a CD or transfer to a portable listening
device.
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34.
Will you let me know what stores my release is available
in?
We wish we could. Only iTunes, eMusic
and Rhapsody let us know when your music is active!
We hope in the future this will change but for now,
we don't know when your music is active on their site.
You'll have to go search for yourself on their system.
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35.
How long does it take to show up on the music services
once you deliver it?
Each company is different, but in
general it takes from 3 weeks minimum, to 4 months maximum.
(Usually 2-3 months.) Once we send it to them, it's
out of our hands and they do what they can to get it
imported and active in their service. We push them to
get it added as soon as possible, and they always do
it as soon as they can.
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36.
How are sales payments reported?
Most companies only report to us every
1 - 3 months. Apple, for example, sends us the monthly
report about 4-6 weeks after the month is finished.
Some companies report a full 3 months after the quarter
is done.
Meaning: At the start of the 3rd quarter for example
you will be receiving a report and payment for the 1st
quarter.
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37.
How long does it take for you to send it to all the
companies?
2-5 weeks, once you've given us ALL
the info we need, and we've received your CD. We have
to encode it into 17 different formats for 40 different
companies, so that's why it takes a while. Plus we have
to verify all your songwriter and publisher info is
correct before we send it out into the world.
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