Thank you.
It's great to have you all here.
I think the folks back home who've been watching the copyright hearings might get the impression that you all look at each other as blood enemies, when actually we're all involved in the same business, which is creating culture and moving culture. It's finding the balance: what is fair and what's not? When I read some of the testimony of the Copyright Board, you guys go at it pretty hard, and that's your job. Our job is to step back and say, “What's the balance here?”
I only have a few minutes, and my colleagues are going to follow up on the issue of the mechanicals because it's so important. But to clarify, Mr. Maavara, you'd talked about money going offshore to these publishers, these labels. The Canadian Federation of Musicians said musicians don't benefit. The accurate thing would be to say session musicians are paid a fee; they're not involved in mechanical royalties. That's an important clarification. If you pay musicians to play on your record, they get paid, but the mechanical royalties are still part of the larger puzzle. The guy who comes in and does the flute might not get a mechanical royalty, but the publisher is given a 50% share of every dollar. The royalties are split. On every dollar, 50 cents goes to the publisher, and 50 cents goes to the musician.
When I was on Stony/Warner, they took the publishing. It wasn't that they were shipping it to an offshore bank account; they needed it to keep the label going. That's who gave us our advances. That's what made it possible. If I were independent, I could divide the 50% publishing share up with my musicians. It's money that comes back into the chain of music development. So I think we need to be clear: we're not talking about you having to pay an unfair fee that's being shipped off to some Cayman Island bank account. This is money that's going right back into our music system.
Mr. Glick, I wanted to ask you a few questions.
We're seeing these new development platforms. When I was in Washington at the Future of Music Coalition, one of the guest speakers was OK Go. Now, OK Go couldn't get played on radio; nobody would touch them till they put a video on YouTube, the famous one with them on those treadmills. The next thing we knew, they were at the Grammys. So you are creating a new platform to give musicians an opportunity.
For example, someone sent me an e-mail the other day of this group Shovels & Rope. I'd never heard of them before. I get an e-mail, and I check them out on YouTube. I figure their video probably cost them about a hundred bucks, but they're fantastic. With digital quality you don't have to pay what used to be paid. When we were starting out, it cost us $10,000 to $30,000 for a video, and it might never get played. That was a huge investment for musicians. It killed us, especially if the television station decided not to play it.
So there is an opportunity through YouTube, through the new distribution methods, for new artists to get their independent stuff out there. Everybody points to Google as making all the big bucks. We're getting access to a phenomenal catalogue of material we never had before. How do you balance that off with the other argument that some of the catalogue is being illegally distributed and someone's losing royalties? What's the balance for Google?