Music Business Final

What percent of the music artist's gross income from work generated by the agency or otherwise eligible for commission do national booking agencies generally take?

10%

What is the most common commission cap range that artist unions impose on agents?

10-20%

SAG-AFTRA artists earn additional wages when the use of a broadcast commercial extends beyond a standard first cycle usage term of ______ weeks.

13

Guilds first became important for working musicians in Western Civilization during which period?

15th and 16th centuries in Germany

When was the first U.S. copyright law enacted?

1790; U.S. Congress implemented a principle of copyright enshrined in the U.S. Constitution.

During which period did audiences begin accepting the idea that they would need to buy tickets to see professional music performances?

1800s

Popular music publishing first became big business at about what time?

1900

During which time period did the American style of music first become a world style?

1920s; the economy grew rapidly prior to the Great Depression

During which era did the dominance of the popular singer began?

1930s to 1940s

During which decade were CDs first introduced commercially?

1980s

A recording contract that gives the label a cut of revenue from licensing artist products such as T-shirts with the artist's picture or band's logo is called a ______ deal.

360

Royalty rates to entertainers to license their personas for merchandise typically runs what percentage of the wholesale prices of the merchandise, when the royalties are based on a percentage of sales and not another formula?

8% to 14%

What is the statutory mechanical rate currently set at by the Copyright Royalty Board?

9.1 cents

Instrumentalists recording music for a major label release perform work covered by union contracts negotiated by which entity?

AFM national or "federation" office

An opera star performing in a major opera house is probably working under the jurisdiction of what labor organization?

AGMA

Which piece of music was the first to sell a million copies in a 12-month period?

After the Ball sheet music

What is the oldest active labor organization in the United States representing musical performers?

American Federation of Musicians

Which labor organization typically represents performers in live venues such as theme parks, casinos, and fairgrounds?

American Guild of Variety Artists

Which statement is applicable when licensing live music at a major hotel?

Blanket license is needed

In what way do motion picture music licensing differ between the United States and Europe?

European theaters pay for a blanket performance license.

Which statement is most applicable for a new opera debuting at the Met?

Grand rights license is needed.

Which entity in the United States is most often used to issue mechanical licenses?

Harry Fox Agency (HFA)

How did the term mechanical originate in the music business?

It was originally a license to reproduce music through a piano roll for a player-piano.

In 2012, iHeart Media and record label Big Machine cut a deal that was significant for what reason?

It was the first time a label would directly collect negotiated performance royalties from a U.S. broadcaster

Which situation would be the most ethically dubious?

Lawyer represents artist in negotiation with company that they have an ownership

Who is most likely to be cited as the earliest notable artist's manager or agent of a professional musician?

Leopold Mozart

In lawsuits such as the Rosa Blasi case or the Ke$ha case cited in your textbook, the artists were pursuing which central legal argument?

Management firms illegally served or crossed the line as agents

Under U.S. copyright law, when is a musical work "created?"

Music is fixed in musical notation or recorded on a phonorecord

Who was most successful at generating revenue for themselves from live music performances?

P. T. Barnum

Which is a virtually unregulatable yet broadly accessible platform used to distribute digitized music files between computers?

P2P file sharing

A provision of the Taft-Hartley Act frustrates music unions primarily for what reason?

Performers in some venues are classified as independent contractors, not employees.

What 20th-century merchandiser allowed music lovers to buy records in a wide variety of retail environments?

Rack jobber

Name the organization that gives out the coveted Grammy music awards.

Recording Academy

The Harry Fox Agency was acquired by which entity in 2015?

SESAC

What is an inaccurate statement about a mechanical license?

SoundExchange is an alternative source for mechanical licenses

Under U.S. copyright law, if there are two composers and three lyricists for a song, they must share the royalties according to which formula?

There is no specific royalty allocation dictated by law.

What is a big concern for general admission seating (first come-first served) because seats are not reserved?

Ticket holders might scuffle in the venue over the best seats.

Which statement is TRUE?

Unions negotiate wages and working conditions.

Which is part of what some companies call the "administration" department for a record label?

accounting

What accounting method provides a snapshot of finances with what's in the pipeline—both what is owed but not yet paid out and what is due to come in but hasn't yet arrived—versus the cash method that doesn't account for any transaction that isn't completed?

accrual

What is a common length for a contract for licensed merchandise by a music performer?

across a multicity tour or one or more album releases

The union known informally by the name "Equity" represents which kind of worker?

actors in live theater

Under U.S. copyright law, how would a phonorecord be best described?

an audio recording of a musical work

SAG-AFTRA might often represent many employees performing what kind of work?

announcers

The starting point for an entrepreneur launching a business is a written document called a business plan that contains these points except which one?

articles of incorporation

According to the representative organizational structure illustrated in your text, if a dispute arises who generally has the ultimate authority for decisions for a major act?

artist

In addition to the personal manager, who should approve the selection of a business manager, accountant, or auditor?

artist

Copyright vests initially with whom?

author

Minstrel show performers of the 19th century were composed of which cultural group(s)?

black and white

Small-size music venues have structural disadvantages, but what advantage do they typically offer?

built-in-stage

The Copyright Royalty Board has the right to set which kind of royalty rate in the U.S.?

cable and satellite retransmission fee

What is a promoter's best option in dealing with a scheduled concert experiencing sharply disappointing sales?

cancel the date

For which use below would a mechanical license be inappropriate?

commercial broadcasts

Talent agents or booking agents typically engage musical artists for what kind of work?

concert or club dates

Which marketing department is responsible for designing and producing any materials necessary to execute a marketing campaign such as posters, point-of-purchase materials, ads, graphics for digital, album artwork, and window displays?

creative services

What is the slang expression for unsold seats at a concert?

deadwood

The Recording Industry Association of America, which is best known for issuing certifications for big-selling records, does not concern itself with ______.

disputes over individual artist royalty payments

Specialty labels tend to be successful when they ______.

do not compete in mainstream music where the majors dominate

The most common source of funding for a startup business is the ______.

entrepreneur

Who is usually NOT supplied by venues during major touring acts?

equipment setup crew

As early as the Middle Ages, musicians from Africa entertained white audiences on which continent?

europe

At festivals, what dilutes the sale of licensed merchandise to any one artist (besides the presence of other artists on the same stage)?

event-themed merchandise

True of False In transactional services, attorneys press the rights of their clients in court cases.

false

True or False A "small right" is defined as the right to exploit a composition that is less than one minute in duration (such as a brief sample used in a rap song).

false

True or False A disadvantage of publicity—which solicits the press and others for coverage in media—is that it costs more than other forms of promotion or advertising.

false

True or False A mechanical license is always compulsory.

false

True or False Administrative publishers generally focus on exploitation.

false

True or False By law, venue operators are prohibited from being promoters of touring acts performing at their facilities.

false

True or False Contractually obligated to achieve maximum income for the artist, a personal manager is well-advised to accept every possible gig when the guaranteed fee is attractive.

false

True or False Few publishers will accept a negotiated mechanical royalty rate from record companies.

false

True or False In ASCAP's early history, its membership largely excluded composers and authors of Broadway musicals and pop songs.

false

True or False In New York, most personal managers must be licensed by the state as booking agents.

false

True or False Individual artists control the lion's share of the music market.

false

True or False It is automatic for acts to drop the promoters that launched their early tours for a promoter of greater stature, indicating there is no loyalty in this segment of music.

false

True or False It's rare for major labels to buy independent labels because their scrappy, iconoclastic organizations are a bad fit with a major.

false

True or False Labels owned music publishing companies tend to have more volatile revenue streams than the side of the operation selling recordings.

false

True or False Large, full-service booking agencies concentrate on representing acts at all levels, including unknown artists, that regularly appear in venues and towns of all sizes, thus being able to "fully serve" the industry.

false

True or False Larger companies merge most business and legal affairs into other departments that handle specific tasks, such as licensing or copyright departments.

false

True or False Lawyers are required to charge artist clients only an hourly fee or a flat-fee retainer.

false

True or False Live concerts do not significantly impact sales of talent's licensed merchandise and records.

false

True or False Most artist-related merchandise is distributed through retail channels.

false

True or False Most recordings at major music labels turn a profit.

false

True or False New artists usually pay personal managers lower percentage representation fees at the beginning of their careers because they simply can't afford to pay the percentages charged superstars.

false

True or False Only after all the final language of a contract is agreed and the contract is signed, an attorney typically then drafts a "deal memo" to summarize the essential elements of the agreement.

false

True or False Personal managers, as the name implies, are primarily responsible for the personal well-being of their clients, leaving most business decisions to attorneys and booking agents.

false

True or False Rights in trade names and trademarks are covered under copyright law in the United States.

false

True or False The capacity of the venue multiplied by the value of an average ticket is called the spec of the event.

false

True or False The executives at larger record labels who oversee distribution of recordings to the consumer marketplace, including packaging, advertising, tours, publicity, promotion, and sales activities, are known as chief executive officers.

false

True or False The fundamental distinction between "grand rights" and "small rights" are the relative size of the use fees.

false

True or False The industry uses the term song-casting to describe publishers' efforts to locate new material to publish that will appear equally attractive to many different artists.

false

True or False The symbol ℗ stands for "performance."

false

True or False The variable pricing of seats based on their proximity and sight lines to the stage is known as papering the house in the venue business.

false

True or False The word infami was coined by social critics to describe Mick Jagger in the early days of the Rolling Stones.

false

True or False To avoid legal conflicts of interest, nowadays the trend is for record labels to rarely own or affiliate with publishing companies.

false

True or False To maximize overseas royalties, a songwriter is usually better off with a "receipts-basis" deal as opposed to an "at-source" deal.

false

True or False To save time and legal fees for beginning artists, most experts advise having one experienced attorney represent both parties in a negotiation

false

True or False Today, the heart of the music publishing industry lies in the print business.

false

True or False Under state law, an artist may only grant "power-of-attorney" rights to a manager who has passed the bar exam in that state.

false

True or False With good long-range planning, it is not necessary to double check items orders placed with vendors a few days before the event.

false

True or False: Early musicians' guilds concerned themselves exclusively with wages and salaries, leaving the question of artistic standards to the purview of noble patrons.

false

Compared to independents, what are the areas in which major labels have the biggest business advantage?

financial strength and distribution prowess

A common element of any booking contract is ______ for the venue, meaning the artist cannot perform at other facilities within a specified radius for a specified period of time.

geographic exclusivity

When it comes to promotion of popular songs, what is the publisher's main concern?

getting music recorded, broadcast, and streamed

Which is NOT one of Web-based tool categories for independent artists?

grant funding

Venues sometimes take a cut of merchandise revenue from concert dates, usually on a variable scale specified in contracts, which is sometimes called a ______ fee.

hall

Which report shows financial transactions over a specified period of time in terms of where the money came from, what was spent, and what was left over after all expenses were paid?

income statement

After a contract is signed with a record label for an artist, which activity by the manager is likely to be most important?

induce label executives to attend showcases

Which is NOT a planned concert expense?

inspector gratuities

At the turn of the century, which business emerged as a way to legitimize and monetize music file downloading?

itunes

In the Great Depression of the 1930s, what emerging platform helped prop up the struggling record business?

jukeboxes

Which clause gives the artist the right to terminate the agreement if a specific agent is no longer with the agency?

just-cause

A U.S. copyright in a composition created in 2016, and not a work for hire, extends for 70 years after which event?

last surviving author's death

When were music industry merchandising methods first developed?

late 19th century

The chief executives in charge of record labels tend to have risen from which work background?

lawyer or producer

What is the advantage of advertising an upcoming concert via an alternative publication, such as a free weekly newspaper, versus a mainstream daily city newspaper?

less expensive and locally focused

Which provision is not a common feature of union agreements that franchise or license a booking agent?

limit on jurisdiction to a 300-mile radius

What equipment is almost always supplied by venues for touring concerts?

loudspeakers

Which is NOT a drawback of using the corporation structure for a business?

margin calls

A large publisher's creative or A&R department will perform a number of tasks. Which one of these tasks would typically not be performed by that group?

negotiate with overseas subpublishers on behalf of writers

A balance sheet that presents a company's financial position does not contain entries for ______.

net profit

Which force in mass communication first powered the popularity of big bands as "name" bands?

network radio

An artist's contract with a personal manager should be ______.

non-transferable

Which event venue offers some of the highest profit margins?

outdoor festivals

A promoter in the concert business is defined as a(n) ______.

party responsible for encouraging people to buy tickets

By the 1980s, which musical instrument typically adorned the parlor of upper-middle-class American families?

piano

Which is NOT a genre that independent music labels pioneered?

pop

What name is used for the entity that most recently handled a touring band in a given area?

promoter of record

What job function is least likely to be handled by union workers in unionized performing facilities?

publicity

What caused mom-and-pop retailers to lose market shares in the 1960s?

rack jobbers, record supermarkets, and mail-order record clubs

A lawyer who is said to "participate" in a deal has what role?

receives a percentage of the deal value as a fee

What viable genres did the big labels overlook, leaving them to independent labels in the 1950s?

rhythm/blues and country/western

Which technique looks at a statistically significant segment?

sample

What is a key factor for promoters in selecting an opening act to perform before a headliner?

selecting compatible music and not overshadowing the headliner

What does the term cut-in most commonly refer to?

sharing of the revenue from a copyright with a party who doesn't own it

In the 1970s, what type of recording artist emerged for the first time as superstars by meshing another creative ability with singing?

singer-songwriter

For planning a concert at a college venue, how long before a concert date should orders be placed for printing tickets and promotional materials such as banners and posters?

six weeks

The performance rights royalty fee that is charged is typically priced as a ______.

small slice of gross ticket sales

In some booking contracts, the promoter and the act agree to divide all box office revenue between them after it reaches the ______, with the artists typically getting the lion's share.

split point

What does the acronym SRO mean in relation to a venue's audience?

standing room only

While revenue from the DIY model might seem very attractive at first glance, artists should keep in mind their direct income could reasonably be reduced by expenses for all except which expense item?

synch fees

What portion of a booking contract outlines specific items required by the artist such as food/beverage catering, lodging, and technical needs?

technical rider

What most irks the promoters and venues about scalpers, who are unauthorized resellers of concert tickets?

they don't share their profits

Concert juggernaut Live Nation also owns which business?

ticketmaster

True or False A common method of settling disputes surrounding artist management contracts is to submit the issues to arbitration

true

True or False A sole proprietor owner is usually held personally responsible for losses at the business, which means the owner's own possessions are at legal risk.

true

True or False A work shall not be considered to have been made "for hire" unless the parties have signed a written agreement saying the work is made for hire.

true

True or False ASCAP does not handle grand rights for its members.

true

True or False An artist may work on a nonexclusive basis with an agency contracted to work with the artist in a limited or specific territory or kind of performance.

true

True or False An unestablished artist needs a personal manager about the time the performer can earn more than union scale.

true

True or False Anyone may make a recording imitating or mimicking the sound of a commercial release without owing a sound recording royalty to the original artist or label.

true

True or False Artists and disc jockeys can quickly stitch together bits of existing songs in mashups in what is called sampling.

true

True or False As a practical matter, successful booking agents serve the interests of two different parties, the artist and the talent buyer.

true

True or False As the recorded music industry declined after 2000, DIY labels took root, operating without big-label infrastructure, using plentiful digital tools available online

true

True or False BMI often negotiates with trade associations representing individual licensees.

true

True or False BMI's first affiliates included songwriters from many genres of music that had not been previously represented by performance rights organizations, including jazz, R&B, country, gospel, and folk.

true

True or False Because of copyright law, under certain circumstances the employer may be considered to be the "author" if the employer engaged a person to perform on a work-made-for-hire basis.

true

True or False Because stadiums make more money from car parking and food/beverage sales than smaller venues, the proportion of ticket sales going to acts is higher in stadium deals.

true

True or False Billing refers to the size, emphasis, and position of names in print ads, billboards, and screen credits.

true

True or False Both artists' unions—the AFM and SAG-AFTRA—require new use payments.

true

True or False By the 1970s, investors became attracted to the music business because of the great potential to make money with recorded music.

true

True or False Cable TV systems in the United States generally operate under a compulsory blanket license for music.

true

True or False Columbia was the first record label to introduce the LP.

true

True or False Contracts must specify under what conditions audits can be performed and precisely who will be liable for the auditing expense.

true

True or False Deals with venues vary based on how much competition there is among facilities in an area, assumed fan base in the region, and whether a venue is lightly or heavily booked already.

true

True or False Deducting shortfalls from concerts that sold poorly from other dates on the same tour that sold briskly is called cross-collateralization.

true

True or False Experienced publishers understand that, at the outset, only a select number of recording artists will even consider their material because so many acts in popular music are self-contained.

true

True or False For many big tours involving contemporary artists, licensed merchandise amounts to a sizeable 10-35% of overall tour revenue.

true

True or False If the personal manager in California wants to stay within the law, book gigs, and remain in the management profession, he or she needs to obtain a talent agent's license.

true

True or False In 1914, a small number of leading American music writers and publishers formed ASCAP as the first such representative entity.

true

True or False In California, only licensed talent agents are allowed to procure employment for an artist.

true

True or False It is possible for an artist to work with an agency on a nonexclusive basis or even with no written agreement at all—a so-called handshake agreement.

true

True or False Like most large business entities, major labels are conservative and are slow to catch up with shifts in tastes in the consumer marketplace.

true

True or False Negative tour support is the money the label has advanced to make up for financial deficits the artist incurs while on tour.

true

True or False Network radio caused music publishers in the United States to close down regional offices and focus staffs and energies on cities such as New York City, Chicago, and Los Angeles.

true

True or False Not only does a corporate enterprise pay corporate taxes, but the investors also pay personal income taxes on dividends received from the corporation.

true

True or False Often the record company and music publisher (which may or may not be owned by the same parent company) are seeking the same talent.

true

True or False Online services pay publishers a fee for providing consumers access to copyrighted music through authorized streaming and downloading.

true

True or False Other than works-for-hire, a copyright transfer or license granted after January 1, 1978 may be rescinded by the grantor after 35 years.

true

True or False Product managers coordinate and oversee all aspects of a current release, including packaging, advertising, tours, publicity, promotion, and sales activities.

true

True or False Publication is the distribution of copies or phonorecords of a work to the public by sale or otherwise transfer of ownership or by rental, lease, or lending.

true

True or False Publishers initially feared radio's impact, believing that "giving music away" through this medium would hurt sheet music sales.

true

True or False Record companies will buy blocks of tickets to concerts of their artists to be given away to local influencers, such as disc jockeys and celebrities

true

True or False Some specialty labels, particularly in classical music, sidestep conventional distribution through stores to instead go direct to buyers and via online.

true

True or False The Association of Independent Music Publishers (AIMP) educates, fosters business networking, and advocates for its members' interests in public policy, regulation and legal matters.

true

True or False The artist generally appoints a manager as his or her exclusive personal manager, while the manager's services to the artist are nonexclusive

true

True or False The largest source of income for many composers and publishers is from licensed public performances of their music by broadcasters, digital outlets, and venues

true

True or False The rider requirements of a performing artist specified in a contract sometimes kill a booking when there's agreement on all other deal points.

true

True or False Today, there are only a handful of major publishers, and they dominate the industry.

true

True or False When "weighting" the value of performances on television, ASCAP takes into account whether the music used was theme music or background music.

true

True or False When whole catalogs are bought, the seller normally assigns all rights of copyright and ownership, including subsisting contracts with writers.

true

True or False With the rise of concert tours as an income source, road managers handle all logistics of the touring.

true

True or False A Spanish language version of a Walt Disney movie would be considered a derivative work.

true

True or False A publisher may contractually commit a writer to delivering a certain number of songs a year.

true

True or False Major labels often generate a majority of their total revenue from international and have offices directly servicing dozens of countries around the world.

true

Why did radio stations largely abandon live music and turn to recordings?

tv cut into its audience

In 1958, what was introduced to the consumer market?

two- channel stereo

Most artist management contracts require a manager to loan the artist money under what circumstances?

under no circumstances

What party is customarily responsible for licensing performance rights for music used at a concert?

venue

The biggest reason corporate sponsors pay to be part of a concert tour is ______.

visibility in advertising and promotional material