For 7 years, Ring Back Tunes (RBT) has been a major window of distribution for music in the country with Telecommunication Companies leveraging on their nationwide platform. With just N50, the service enables subscribers to change the conventional ringing sound when he or she is called to a song of their choice, which entertains callers each time they call the subscriber’s phone. Usually, the parties to this transaction are the Record Label or Owner of right in Musical works, a Servicing Company like Vas2net and Mtech, and the Telecommunications Company. The Label licenses the necessary rights in the musical work to the Servicing Company who in turn sublicenses to the Telecoms Company.
Did you know that telecoms companies charge between 70 to 75% of the total revenue generated from Ring Back Tunes also known as caller tunes, leaving the Labels and the servicing companies to share the 30 – 25% in a 50% – 50% ratio? And that at the end of this chain is the artiste who has a crappy 70% – 30% sharing formula with the label, the 30% of which is subject to recoupment for costs? Am I the only one that thinks this is insane!?
If you have ever wondered why artistes sign away 7 years of their career to a label and why an A – list artiste who has spent 3 years making hit songs, would complain about revenue received from the label, now you know why. But who can blame the record labels? As a business and legal adviser, I wouldn’t advice otherwise because investments have to yield returns. Unfortunately, deals like the one stated above have made profit generation slow. It is a ripple effect and the telecoms companies are to blame!
What I don’t understand is why everybody seems fine with it.
In an interview with the NET, the CEO of Achievas Music (home to pop singer Solid Star) stated: ‘The caller tune service is helping in fulfilling those goals and that’s good enough for us’
GOOD ENOUGH? Where the total revenue generated by the telecoms company for a song is 100 million Naira, the record label walks away with about 15 million Naira before tax is deducted. The remainder of which will be shared in a 70 – 30 ratio with the talent – who ends up with nothing more than 4.5 million before recoupable costs. Can you call that good enough? That is everything but good enough and is only similar in comparison to breadcrumbs and bones!
This is nothing but slavery in my opinion and in the words of the great Tyrion Lannister, “It’s easy to confuse what is with what ought to be, especially when ‘what is’ has worked out in your favor.” Is it really working in their favor? Is 15% of the total revenue generated from RBT in the industry’s favor? Your guess is as good as mine.
Growing up, Aminata Sow Fall’s Beggars Strike, a comical satire taught me that no one will appreciate you unless you project reasonable self worth. If you haven’t read it, it is a tale about beggars, embarking on a strike after being unfairly and forcefully removed from the city by the government to improve tourism and how they leveraged on their importance to Zakat (the third pillar of Islam to give to the poor and needy) in a predominantly Islamic country to triumph.
I am projecting this story on the music industry to show how talent and owners of musical works have undervalued themselves in a bid to feed off the breadcrumbs and leftovers of the telecommunication companies. Unless we discover and project our value, no one will do it for us. Unlike the beggars in the book we do not have to dig deep or think hard to know how important talent and music is to the telecommunications companies as well as in the Nigerian entertainment scene.
The telecoms company might seek to justify this unfair ratio as distribution costs and fees but that remains to be seen and the burden of proof is on them because on the face of it, the pipelines for distribution have already been laid. If artistes can demand to renegotiate their contracts with record labels (who can justify an initial 70 – 30 sharing ratio because they run on a deficit due to recurring costs in the furtherance of the talent’s career like recording costs, facilitating airtime plays, accommodation and feeding cost etc,) after they have recouped their expenses and made profit.
In the same vein, the telecoms company should be subjected to the same reasoning and asked to reduce the sharing formula. If neither the record labels nor COSON will attempt to re-negotiate this formula, it is important for the government to step in and regulate this area – to encourage creativity and increase the incentive for authors of musical works.
Photo Credit: Dreamstime | Atholpady