Zoe Keating

Zoe Keating, notorious champion of the DIY music frontier, shares an interesting analysis of the way ASCAP plays a little game of “reverse Robin Hood” with touring royalties, stealing from the independent poor and funneling cash to the Lady Gagas and U2s of the world.

Keating points to the ASCAP deduction that appears on her nightly concert expense reports: in one example, an $86 fee for a show that grossed $9336 in ticket sales. Venues must pay ASCAP and other licensing agencies a blanket fee for the right to feature music written by ASCAP songwriters in their space. This prompts many venues pass the bill on to the performing artist in turn (whether that artist is registered with a licensing agency or not).

Those fees are eventually redistributed to rightful content creators (for instance, to the original songwriter when a band performs a cover song). So Keating–as an ASCAP-registered composer and publisher–should recoup the fees for performing her own work, right?

Nope:

I called ASCAP to see how I should go about claiming these concert royalties.

The customer service representative on the phone said there was nothing for me to claim. He informed me that ASCAP pays out performing royalties only to the 200 top-grossing concert tours, as determined by Pollstar. They also pay royalties for “Live symphonic and recital concerts”, whatever they are (he said I don’t quality for those).

In other words….

Every day, thousands of venues are required to pay a percentage of their gross ticket sales to ASCAP who then gives that money to…let’s look here on Pollstar and find the highest-grossing concerts for 2011….U2, Taylor Swift, Kenny Chesney, Lady Gaga, Bon Jovi, etc. 

In short, ASCAP charges a percentage of ticket sales from any venue that ever intends to perform a piece of ASCAP-protected material, distributing that money to its top 200 artists and cannibalizing money from the talent below the cutoff line. This creates a situation where Keating — and indeed, artists #201 through infinity — can be charged out of pocket on a nightly basis for the audacity to compose, publish and perform a song with no outside involvement. She can, in turn, expect to see those charges funnel upward to please ASCAP’s most elite clients.

ASCAP’s answer to this imbalance is the “ASCAP Plus Cash Awards” program, to which members can apply to be “awarded” a chunk of those licensing fees for artists who generate “substantial performance activity in media and venues.” Note that, in this system, the artist must take the initiative to reclaim their own licensing payouts. The “Top 200 + Awards” system was established 50 years ago, when monitoring licensed plays at venues across the country would have cost more to execute than the balance of inbound royalties itself.

In reality, the “it’s too hard to report” excuse became obsolete as soon as the Internet was invented. Digital systems make this stuff relatively trivial to track on a granular level, meaning there’s no reason we can’t link the songs Keating performed to the sales figures in a database, and then pay her proportionally. But ASCAP has no intention to stray from its cash-hoovering Ponzi scheme, foreboding a possible class-action lawsuit when the levee breaks.

There’s an excellent debate on the topic over at Techdirt, where Keating herself expounds on the issue a few times in the comment section. We want your opinion: what will it take to develop and implement a system that is fairer to content creators?