The Guestbook limericks have me gasping in admiration & wonderment, wonderment that any of us would put time & effort launching Devizes on an unknowing world in this particular fashion. For foreign visitors, I recommend Marlborough just up the road. And when there, head for the Polly Tea Rooms and say I sent you. The main drag has suffered in the past 15 years - financial services & supermarket brutalism - but the town is still present. And the Polly Tea Rooms settle the agitated aesthete, at least until the sugar from tasty cakes hits the system.
The post on naming from the Georgeous Sidney Smith, municipal arts officer, as ever with Sid, hit the mark.
This morning, a visit to our building site in West Dorset. This afternoon, piles & piles of paper & important `phone calls. A meeting of The Big Two addressed necessary DGM realignments & radical shifts which are on their way.
The fifth business aim of DGM is to be a model of ethical business in an industry which is, well, "founded on exploitation, oiled by deceit, riven with theft and fuelled by greed". I take this aim, and the other four, seriously. Few claim perfection, but we may present ourselves to serve our ideal of the perfect world.
We have received several requests in recent months, including from Mexico, to post our DGM Artist Agreement. This has evolved as the business has developed over the past 7 years and, were you to be an artist developing a relationship with DGM today, this is the letter we would send you. I have checked with Diane (on the West Coast) & David for their approval on the form of words, & their permission to make it public. So...
DGM Artist Agreement.
DGM does not have formal contracts between the company and its artists, but exchanges a Letter of Understanding. The Letter states the terms of relationship. This follows the precept:
Unless you are able to understand 98% of a contract, written in English and read within 20 minutes, bin the contract.
Our experience of major label standard contracts suggests these are:
1. Inequitable and one-sided, disproportionately to the advantage of the major (where comprehensible); otherwise:
2. Beyond the comprehension of a person of reasonable intelligence and education, fluent in the English language but without legal training;
3. Exploitative, notably in demanding copyright ownership of the artists' work (as "standard company policy").
The effect of this is to place business negotiations increasingly in the hands of solicitors and specialist lawyers. Major labels have now combined Departments of Business Affairs with those of Legal Affairs. This renders negotiations increasingly:
i) Legalistic, adversarial and inflexible;
ii) Expensive for the artist, and the independent record company;
iii) To the advantage of the major labels: the costs of legal departments are within operating budgets.
Agreement is, given the bias of the contract, unlikely. Unless the artist is desperate to be signed, the standard terms and conditions are unacceptable. Increasingly, this suggests that young and beginning artists will sign with major labels; and mature, recognised artists will look for other forms of distribution.
DGM operates on a basis of trust, and is non-contractual. We operate a "No Jerk" policy for new artists (and customers) so that, within our space, DGM is a Jerk-Free Zone.
August 10th. 1999;
Robert Fripp.
Letter of Understanding.
I
Copyright
Artists retain all copyrights in their works, and grant Discipline release rights. The artists are free to take their work elsewhere, subject to Discipline honouring its commitments to distributors (who normally ask for a six-month selling off period).
II
Territories
Current DGM releases are for the world. It is no longer feasible to license releases for individual territories.
III
Royalties
Periods:
March 31st. for July - December;
September 30th. January - June.
Rates:
The aim is to balance the need for DGM to meet its true operating costs and pay the artist the maximum possible rate. The current DGM rate in the UK and US is 45% of net distributor receipts, above 2,000 sales.
On the first 1,000 sales, 25%;
On the second 2,000, 33%;
Above 2,000 sales, 45%.
The sliding rate for the first 2,000 sales is to cover increasing set-up costs of releasing through mainstream distributors in the US and UK.
This equates to approximately £2.36 in the UK, £1.68 in continental Europe, and $3.00 in the US for a full-price album.
An approximate breakdown, based on a conventional jewel box and single CD, is:
United Kingdom:
Dealer Price £ 7.89
Received from distributors (average) £ 5.25
Less 45% Royalties to artists (£ 2.36)
Less Mechanical fee paid by DGM for publishing (£ 0.67)
Less Manufacturing costs paid by DGM (£ 1.00)
Total DGM operating costs £ 1.22
United States:
Net received from RYKO distribution $ 6.75
Less 45% Royalties to artists ($ 3.03)
Less Mechanical fee paid by DGM for publishing ($ 0.85)
Less Manufacturing paid by DGM ($ 1.50)
Total DGM operating costs $ 1.37
Europe:
In continental European territories, the royalties are net of warehouse charges.
This fee is paid to our manufacturer for dispatching such orders. All European royalties are calculated at 45%, except where the net value falls below £4.50. In such cases, the royalty rate is reduced by paying on a proportionally lower percentage of sales. For a CD sold in France at £4.11, we pay on 91.33% of sales (£4.11 / £4.5): £1.68.
Invoice value £ 4.50
Less Warehouse charge (£ 0.39)
Net received from Distributor £ 4.11
Artist royalty 45% @ 0.9133 (£ 1.68)
Less Mechanical fee (£ 0.67)
Less Manufacturing costs paid by DGM (£ 1.00)
Total DGM operating costs £ 0.76
Japan:
DGM releases are currently licensed by Pony Canyon and subject to formal contracts. Albums are licensed for three years. Pony Canyon pay a royalty rate of 17%.
Advances and contracts are negotiated by Infini Communications, DGM's representatives in Japan, for 13.5% commission on any initial advance. Infini work together with Pony Canyon for press, publicity and promotion in Japan.
IV
Publishing
DGM pays publishing at the nationally agreed rate of 8.5% of dealer price to MCPS for European sales. In the U.S., payment is made to The Harry Fox Agency and DGM pays a maximum of 12 tracks on a single full-priced album, 24 tracks on a double album. The U.S. rate is currently 7.1 cents per track, or 1.35 cents per minute, whichever is larger.
V
Advertising
DGM distributes a high proportion of its income in royalties, so it is not possible to undertake large-scale advertising for individual releases. Specific advertising budgets may be agreed with the artist. The cost of advertising is normally divided 2/3 to the artist and 1/3 to Discipline, pro rata to the division of income. The artist's share is recouped against their royalties.
VI
Publicity / Promotional Copies
Artists who chose to use DGM publicists similarly share the cost, 2/3 to 1/3, also recoupable. Where artists choose to use their own publicists, we supply a reasonable quantity of promotional CDs.
VII
Discipline sells CDs to the artist, for their merchandising, at net dealer price. In the UK, @ £4.50, in the US @ $6.75, both plus delivery. DGM invoices the artist for these sales, to be paid net within 60 days or by prior arrangement.
DGM pays publishing fees and royalties to the artists on these direct sales in the usual way.
VIII
Artwork and Mastering
DGM bases its royalty rates on receiving finished parts, including artwork and mastering. Where DGM provides artwork or mastering services, these costs are invoiced or recouped.
IX
If you have queries regarding this Letter of Understanding, please contact us. Please sign and return one copy of this Letter for our records, acknowledging agreement with our terms of trading.
Discipline Global Mobile Ltd.
"Duration is subjective."
