Capitol/EMI Cuts Off Nose
Capitol/EMI is the smallest of the so-called Big Four major record companies. Like the other majors EMI been bleeding money over the last several years, but EMI has been bleeding talent as well, having lost signature acts such as the Rolling Stones and Radiohead since their 2007 purchase by private equity company Terra Firma. Rumor has it that Queen is talking to other labels. And EMI just lost a suit over downloading to Pink Floyd, an act that has been with the company for over 40 years. In addition to being seemingly unable to restructure their debt covenants successfully, EMI doesn’t seem to get the internet either. The recent departure of OK Go is a case in point.
OK Go is the group that brought you that wonderful “Treadmill Video” (http://www.youtube.com/watch?v=dTAAsCNK7RA) in 2006 (featuring the group dancing on treadmills to their song “Here It Goes Again”) that went viral in a heartbeat. As group leader Damian Kulash wrote in a New York Times Op Ed: “As the age of viral video dawned, “Here It Goes Again” was viewed millions, then tens of millions of times. . . . To the band, “Here It Goes Again” was a successful creative project. To the record company, it was a successful, completely free advertisement.” So what did EMI do in response to this fortuitous situation? They disabled the embed function for all their videos on YouTube.
Going viral, by definition, doesn’t happen from only one place. The way tens of millions of people get turned on to a video is by having it embedded in countless blogs, fan sites, and by video aggregators. In the case of the “Treadmill Video,” the numbers tell the story. “When EMI disabled the embedding feature,” according to Kulash, “views of our treadmill video dropped 90 percent, from about 10,000 per day to just over 1,000.” EMI, of course, defends the decision because they only receive royalties when the video is viewed on YouTube. But the irony here is that, given their deal with YouTube, Kulash estimates that EMI’s take from the “Treadmill Video” was just over $5,000. The cost of that decision? Losing 90 percent of the viewers who might have bought the music.
These are the kinds of decisions you get when you put people who don’t understand music or the internet in charge of music corporations. The label recently got into hot water with Pink Floyd for selling single downloads from the group’s concept albums, which is specifically prohibited in Pink Floyd’s contract. Winning such a suit is more likely in a place like Great Britain where copyright law includes the notion of “moral rights,” which protect the artistic integrity of a work. Concurrently, CEO Elio Leoni-Sceti unexpectedly resigned. His replacement? Charles Allen, former chief executive at the British television company ITV and an adviser to Goldman Sachs, the people who brought you our current economic meltdown.
There is some sense that Pink Floyd was being somewhat disingenuous with the suit. As New York Times reader mikesteel2 commented, “the group has no problem with radio stations playing individual songs 'out of context' as well as performing individual songs in concert . . . And what about all of those greatest hits collections?” Still, in a larger sense, EMI doesn’t seem to be able to get its economic act together or avoid alienating some of its top acts. And putting a music corporation in the hands of a former consultant to Goldman Sachs just can’t be a good idea for music.
This article was simultaneously published at http://reebee.net/.