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Chapter 1: First Steps
OPEN UP AND SAY "AHHH"
For many years I taught a class on the music business at the University of Southern California Law School's Advanced Professional Program. The class was for lawyers, accountants, record and film company executives, managers, agents, and bartenders who want to manage groups. Anyway, at the beginning of one of these courses a friend of mine came up to me. She was an executive at a film studio and was taking the class to understand the music industry as it relates to films. She said, "I'm here to open up the top of my head and have you pour in the music business." I loved that mental picture (because there are many subjects I have wanted to absorb this same way), and it spurred me to develop a painless way of infusing you with the extensive materials in this book. So if you'll sit back, relax, and open up your mind, I'll pour in all you need to know about the music business (and a bit more for good measure).
HOW I GOT STARTED
I really love what I do. I've been practicing music law for over twentyfive years, and I represent recording artists, record companies, film companies, songwriters, producers, music publishers, film music composers, industry executives, managers, agents, business managers, and other assorted mutants that populate the biz.
I got into this on purpose, because I've always loved creative arts. My first show-biz experience was in grade school, performing magic tricks for assemblies. I also started playing accordion in grade school. (I used to play a mean accordion; everyone applauded when I shook the bellows on "Lady of Spain." I gave it up because it's impossible to put the moves on a girl with an accordion on your chest.) By high school, I had graduated from accordion to guitar, and in college at the University of Texas, I played lead guitar in a band called Oedipus and the Mothers.
While I was with Oedipus, we recorded a demo that I tried to sell to our family friend, Snuff Garrett (more about him later). Snuff, a powerful record producer, very kindly took the time to listen to the demo and meet with me. That meeting was a major turning point in my life. Snuff listened to the record, smiled, and said, "Don...go to law school."
So I took Snuff's advice, and went to Harvard Law School. In law school I continued to play lead guitar with a band called The Rhythm Method, but it was becoming apparent that my ability to be in the music business and eat regularly lay along the business path. So when I graduated, I began doing tax planning for entertainers. Tax law, like intricate puzzles, was a lot of fun, but when I discovered there was such a thing as music law, the electricity really turned on. In fact, I took the USC class that I later taught, and it got me so excited that I left the tax practice for my current firm. Doing music law was so much fun that it wasn't even like working (I'm still not over that feeling); and I enjoyed it so much that I felt guilty getting paid (I got over that).
My first entertainment law experience was representing a gorgeous, six-foot model, referred to me by my dentist. (I promised him I would return the favor, because most of my clients had teeth.) The model was being pursued (I suspect in every way) by a manager who wanted a contract for 50% of her gross earnings for ten years. (You'll see how absurd this is when you get to Chapter 3.) Even then I knew this wasn't right, and so I nervously called up the guy to negotiate. I still remember my voice cracking as I said his proposal was over the industry standards, since most managers took only 15% (which was true). He retorted with, "Oh yeah? Who?" Well, he had me. I wasn't even sure what managers did, much less who they were. So I learned my first lesson in the art of humility.
As I began to really understand how the music business worked, I found that my love of both creative arts and business allowed me to move smoothly between the two worlds and help them relate to each other. The marriage of art and commerce has always fascinated me -- they can't exist without each other, yet creative freedom and the need to control costs are eternally locked in a Vulcan death match. Which means the music business will always need lawyers.
Anyway, I now channel my creative energies into innovative business deals, and my need to perform is satisfied by teaching, lecturing, and playing guitar at my kids' campouts. (I do a great "Kum-Ba-Ya.") Just to be sure I don't get too straight, however, I've kept up my weird assortment of hobbies: magic, ham radio, weight-lifting, guitar, dog training, five-string banjo, karate, chess, and real estate investment. I also write novels, which you are all required to buy.
BRAIN SURGERY
Speaking of marrying creativity and business, I've discovered that a rock star and a brain surgeon have something in common. It's not that either one would be particularly good at the other's craft (and I'm not sure which crossover would produce the more disastrous results), but rather that each one is capable of performing his craft brilliantly, and generating huge sums of money, without the need for any financial skills. In most businesses, before you can start earning big bucks, you have to be pretty well schooled in how the business works. For example, if you open up a shoe store, you have to work up a budget, negotiate a lease, bargain for the price of the shoes, and so forth -- all before you smell that first foot. But in entertainment, as in surgery, you can soar to the heights without any expertise in the business end of your profession.
Making a living from a business you don't fully understand can be risky. Yet a large number of artists, including major ones, have never learned such basics as how record royalties are computed, what a copyright is, how music publishing works, and a number of other concepts that directly affect their lives. They don't know these things because (a) their time was better spent making music; (b) they weren't interested; (c) it sounded too complicated; and/or (d) it was too much like being in school to have to learn it. But without understanding these basics as a foundation, it's impossible for them to understand the intricacies of their professional lives. And as their success grows, and their lives get more complex, they become even more lost.
While it's true that some artists refuse to even listen to business talk (I've watched them go into sensory shutdown if you so much as mention the topic), others get interested and really study their business lives. The vast majority, however, are somewhere in the middle of these extremes. They don't really enjoy business, but want to participate intelligently in their career decisions. These artists are smart enough to know that no one ever takes as good care of your business as you do.
It was for my moderate-to-seriously interested clients that I developed a procedure of explaining the basics in simple, everyday language. With only a small investment of time, these clients got down the essential concepts, and everyone enjoyed the process (including me). It also made an enormous difference in the artist's self-confidence about his or her business life, and allowed them to make valuable contributions to the process.
Because the results of these brief learning sessions were so positive, several clients asked if we could explore the subjects more deeply. Thus the conception of this book. It's designed to give you a general overview of the music industry as it currently exists. You can read it as casually or intensely as suits your interest level, attention span, and pain tolerance. It's not written for lawyers or technicians, so it doesn't include the jargon or minutia you'll find in a textbook for professionals. Instead, it gives a broad overview of each segment of the industry, and goes into enough detail for you to understand the major issues you're likely to confront.
JUNGLE MAPS
When I was in high school, a policeman named Officer Sparks spoke at an assembly. Mr. Sparks hyped us on the life of a crime fighter, certain that we all secretly wanted to be cops. While the man didn't sway me off the path of my destiny, he did show me something I'll never forget.
Officer Sparks ran a film in which the camera moved down a street. It was a grainy black-and-white movie, only about thirty seconds long, and consisted of a camera bobbing along a sidewalk. When it was finished, he asked if we'd seen anything unusual. No one had. Apart from a couple of people bouncing in and out of the doorways, it looked pretty much like pictures taken by a camera moving along a row of shops. Mr. Sparks then said that a "trained observer" who watched the film could spot six crimes being committed. He showed the film again and pointed out each of the incidents (there was a quiet exchange of drugs, a pickpocket, etc.). This time, the crimes were obvious. And I felt like a doofus for m...
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