To answer your questions in order:

As far as I can tell, there are several hundred copyright holders who have not registered. There are only a couple recognizable names on that list from a quick scan that I have done, and of those names, two are foreign labels that had only a single release I know of, two are labels that have been out of business for about 50 years and three are bootleg outfits. None of them are likely to register.

I think it is highly likely that SoundExchange is paying labels in many cases where the artist money goes unpaid. There are hundreds of artists who, from all online appearances, are currently under contract to latin and international branches of the four US majors who are on the unfound artist list. SoundExchange is currently claiming that they have contacted a large number of artists on the list who have not followed through with registration (which makes it the artists’ fault they aren’t getting paid), but unless they are going to claim that everyone who sings in Spanish hates the idea of getting paid, that argument won’t wash.

SoundExchange has it’s books audited on an annual basis, but that is for internal purposes only and they don’t reveal the results. Registered artists are given the right to audit SoundExchange, but the time and expense that such an audit would take makes the right an empty one.

SoundExchange treats nearly all its financial information as proprietary, so transparency is non-existent. They will, if it is in their interest, give generalized round figures as to revenue and royalty payouts, but not enough for anyone to get a fair idea of what actually goes on. The only numbers they have to make public are those on the informational tax return they must file as a not-for-profit corporation. The last time I checked, their 2006 return had not yet been made public.

Under Federal regulations, the forfeited money is supposed to be used to defray general operational expenses for the organization. This would include the contributions SoundExchange makes to the musicFIRST campaign for the terrestrial radio performance royalty, the lobbying to uphold the ruinous webcaster royalty rates and to pay Wyclef Jean for appearing at their Christmas party. SoundExchange executives have confirmed that is where the money goes, although they initially said that it all went into royalty payouts for registered artists and labels. They explained the correction by saying that operational expenses are reduced by the forfeited funds, thus increasing payments to the artists and labels, which is really an entirely different thing.

Some SoundExchange representatives continue to say that the money goes directly to the registered artists and labels, despite the regulation. According to these representatives, allocation is made to registered artists on a pro-rata basis. This means the more a registered artist is played on the Internet or satellite service, the more of the forfeited money he or she makes. Of course, half of the forfeited money goes to the copyright holders, and by current estimates, 70% of the copyright holders’ money goes to the four RIAA labels. So, 35 cents of every forfeited dollar reaches the RIAA.

As almost all this money comes from artists, what is happening is essentially Robin Hood in reverse. Money is taken from thousands of smaller artists. Half is given to other artists, with the bulk of it going to the most popular ones (who arguably need it least) and the other half not going to artists at all, but going to labels, with 70% of that share ending up in the hands of the majors.

Quite a racket, don’t you think?

According to the SoundExchange charter, artists cannot even be members of the organization. That right is limited to copyright holders only. There are no artists on the Board. There are nine “artist representatives” who were mostly chosen by the RIAA. The two who were not are there as representatives of the AFM, the musician’s union, and AFTRA, which represents singers. The other seven are lawyers and artist managers. None of them are accountable to the people they were selected to represent.

Is SoundExchange having any better luck finding the copyright owners? I wonder how often SX can find the copyright owning label or its successor and pay for spins on a track, but can’t find the corresponding performing artist to pay his percentage.

By the way, who’s auditing SX’s books? Is there any transparency in their financials? How much money has SX collected, how much has been paid out to copyright owners, how much to performing artists, how much used for administrative/legal costs, how much is in escrow and how much is forfeited. And is the money that’s forfeited going to reduce what’s held out for administrative costs? Surely the artists (and the radio stations paying the fees) have a right to know those figures.

And shouldn’t at least 50 percent of the SX board be performing artists? And shouldn’t those board seats be elected by all of the stakeholders? Let’s get this organization wrestled away from the major labels and turned over to the people it’s supposed to be representing.

I have to agree with alant —– “SE displays nothing but serial bad faith on this matter. They absorbed something in the three digit millions last round via royalty forfeiture — and they still can’t afford to ‘find’ these people? Right. Sure…”

What you are talking about are compositions that are not licensed. If anyone has authorized the use of compositions without a license for compositions that are not in the public domain then that is wrong, as it it can only lead to violations of the moral right to retract any composition from public use, a good reason for not issuing licenses.

Also, what stops the songwriter from suing a radio station that uses his/her composition without the writer’s authorization, a clear copyright infringement? Is anyone saying radio stations are exempt from being sued for copyright infringement?

This whole thing of SE collecting for all compositions, including unlicensed ones makes no sense because the SE licensee could still be sued by the songwriter as an infringer if the songwriter did not authorize the use of the composition to begin with.

Note that interesting follow-up post on the Velvet Rope forum where this all started where someone was facing a similar ‘lost artist’ managed to nail down something like +80% of this ‘missing’ artists with some mere hard work. And that was in pre-internet days. I’ve met some of the SE interns and while they’re not the brightest bulbs in the world, christ, stick twenty of them in a room with Google and some phonebooks and they could blow about half of that list away in a week. Give them a coffee budget and that’ll drop to 4 days.

Point being: this many ‘missing’ entities from an organization with deep pockets, money coming out their yang – and one who stands to benefit financially for /every one of those artists it doesn’t find/ – speaks only of criminal wrongdoing, terminal stupidity, or both. Even the most braindead of astroturfing SoundExchange – hired PR hamsters that show up on these forums and try to spin these stories can’t debate that one.

So we may be drinking from the same water, but SE’s got a 100 horsepower pump – one they bought with our money – and they’re using it to pump it all back into their lake. To not point out the pump, the theft, the theif, and their sheer audacity of the act is a failure by the artists and their representation of equally stupid proportions.

And I like the touch of your writing too.

that’s a classic
“Then there are artists that sincerely do not want to be found. There is at least one artist on the list who I believe is a fugitive from justice.”
LOL

“Has anyone investigated the legal angles here, such as representation without a power of attorney?”

SoundExchange is authorized to collect royalties for “unregistered” (unfound) artists under the DMCA and the SWSA of 2002. These laws authorized qualified collection and distribution entities (of which SoundExchange is currently the only one) to issue blanket licenses to webcasters that cover ALL recorded music, rather than just for artists who are registered. The intent of this provision was a good one; it protected webcasters from a proliferation of infringement suits (and large damage claims) brought by unregistered copyright holders and artists for inadvertently playing their recordings. The result, however, is that SoundExchange has the legal authority to collect royalties for people and labels it doesn’t formally represent.

If SoundExchange was actually doing the job it promised to do for artists, or, at the least, was trying its best to do the job, the “unfound” artist list would be substantially smaller than it is, There are always going to be artists who cannot be found. I recognize some names on the list of artists who have been dead for fifty years or more, and locating heirs is not easy, especially when the recordings are out of print and not generating transactional royalties to trace. Then there are artists that sincerely do not want to be found. There is at least one artist on the list who I believe is a fugitive from justice.

Interestingly, one of the justifications usually given for the SoundExchange forfeiture of unclaimed artist money is that it is required by Federal regulation. This is true. There is a regulation that “requires” SoundExchange to take money that is unclaimed for three years and use it for its own expenses. That regulation is based on a provision in the regulations that cover PBS radio stations and the performance royalties that are due on “orphan” works. In the normal course of business, these radio stations make blanket payments to ASCAP, BMI and SESAC for public performance rights for their respective catalogs. There are compositions, however, where there is currently no legitimate claimant for those royalties. In most cases, the publishers have ceased to exist and are not affiliated with any of the Performing Rights Organizations. The station must do some “due diligent” searching to find the proper recipient, and has to establish an escrow account for money it cannot pay out. Because substantial money had accrued in those escrow accounts over decades, the stations requested, and got, relief from the Library of Congress, and are now allowed to absorb that money into their general budgets after holding on to it for three years.

The main differences between that provision and the one used by SoundExchange in the forfeiture of artist money are that there is no standard for that “due diligence” searching, and the amount of money available for forfeiture to SoundExchange is hundreds of times more than the amount of “orphan works” royalties. The amount that a PBS station may recover after three years might be enough to cover the cream and sugar budget for the station coffee pot. The amount SoundExchange can swallow in a forfeiture is closer to the cost of buying a herd of milk cows and a sugar plantation.

SoundExchange has nothing to do with p2p or downloading. The royalties paid to SoundExchange are from satellite and online streaming services like Pandora and Live365. These are performance royalties, not transactional royalties.

Fred

Though I didn’t express it well. That was poart of my point.

The other part is, that no matter what the record companies say,
they DO NOT WANT such a centralized system at all, especially if
it includes no affiliated artists, for that very reason.
It’s much easier to steal when the accounting can’t be verified.

If artists are to get paid, it is because they have a right to get paid. If an artists has a right to be paid, and that artist authorizes SoundExchange to represent him or her, how is it possible that SoundExchange cant find the represented artist? If so, then SoundExchange is in false representation. Normally a (State in USA) crime.

Or maybe SoundEexchange is doing the representing because a the record companies authorized SoundExchange to represent the artist. That is false representation too, if the artist (or all the heirs) did not authorize the record company through a notarized power of attorney to represent him or her or them. That may also be false representation too.

Has anyone investigated the legal angles here, such as representation without a power of attorney?

Also, what kind of power of attorney has no address on it?

http://pastebin.com/

(collaborative debugging tool) maybe it could help “de-bug” soundexchange too?

I have a list that is current as of about three weeks ago (the last time the site worked well enough and long enough for me to cut and paste the names onto a spreadsheet, but it is 7,874 names long. These are the “unfound” artists who have already had their money forfeited to SoundExchange for all performances prior to April, 2005.

I have no idea who the other 32,000 artists are that Simson now admits they can’t find. Since, Brandon aside, no one really believes they have any interest in finding any of the 40,000, I don’t think it is likely they are going to release those names on their own.

If there is a public place to post the list, I would be happy to.

Dreddsnik,

Remember that SoundExchange collects money for Internet and satellite broadcasts, not downloads.

Also remember that most downloading does not go through centralized websites like AllofMP3, so keeping accurate and complete census data on download traffic is far more difficult than you suggest. In retrospect, by crushing the original Napster instead of realizing it was a way to make money from downloading, the record industry not only lost the financial golden goose, they inadvertently created the decentralized filesharing systems like KaZaa that make census data collection as impossible as preventing filesharing in the first place.

Fred

Every download on from an AllofMP3 style website can be logged.
There would be no need for ’sampling’ at all.
Only artists that were actually paid for woud get paid.

How about you c+p all the names they have disclosed publicly so far and publish that one somewhere prominently?!
(hint: p2pnet.net/unfound_artist_list.txt)

That isn’t water. That’s Kool-Aid SoundExchange is serving.

SoundExchange doesn’t want anyone’s “cooperation” in finding artists.

Because I was publicly critical of their efforts at finding people, at a music conference in 2004, John Simson publicly challenged me to help. I guess he thought he was going to call my bluff, but I immediately accepted. (I have a hard earned, and well earned, reputation for finding artists.) For two years, Simson and his staff jerked me around, continually lying to me about having me help, then never following through.

Finally, after a newspaper article in which I was quoted again criticizing them, Simson contacted me. He said he would give me the complete list of artists they could not find. All I had to do was promise not to disclose to anyone I had the list. In other words, if my sister was on the list, I couldn’t tell her SoundExchange had money for her.

Does that sound like an organization that wants “cooperation?”

Why do you think that SoundExchange, after all this time, hasn’t engaged in those mass/viral communications you think could help solve the problem? It’s not like they don’t know the potential exists.

When they went looking for artists to support the high Internet radio royalty rates imposed by the CRB last year, they sent out multiple emails to every registered artist and included a printed plea for help with every royalty check. Yet, oddly, when it comes to finding those “unfound” artists, they haven’t asked the artists for any help, not even once. In my experience, the best way to find artists is to ask other artists. I even told SoundExchange this repeatedly, so it isn’t like they don’t know it,

And they also know that when they announced the first forfeiture of artist money back in the fall of 2006, it was primarily the work of people outside SoundExchange who publicized it and spread the word through blogs, message boards and newsgroups to find people before they lost money. In the 90 days before the deadline, nearly 1,800 names were removed from the list, and almost all of them were the result of someone OUTSIDE SoundExchange getting them registered. That worked out to be about 20 artists a day signed up.

After the deadline passed, and the public help ended for the most part, SoundExchange didn’t take up the task on itself. They went right back to the way they had always looked for “unfound” artists. In the next six months, they managed to remove all of 90 names from the “unfound” list. That’s about two artists a WEEK. I sent them more than 10 of those 90 myself, so that even undercuts that dismal performance.

And one more thing. The next time SoundExchange scheduled a forfeiture from the artist funds, they didn’t even issue a press release. They mentioned it in the small print that introduces the “unfound” list on their website. Could it be that they didn’t want to risk having another 1,800 artists “found?” If that isn’t the reason, you tell me why they kept it all a secret, and how that should encourage anyone to think they want “cooperation.”

It would be nice to think that SoundExchange wants to find artists so they can pay them, but the facts don’t back up that theory. If they don’t find the artists within three years, they get to keep the money. That would be motivation enough not to look. don’t you think?

A few coordinated and simple mass/viral communications could potentially take a bite out of the missing artist problem. For those of us that have the resources, it’s probably no significant effort to urge artists we come into contact with to register and/or update their contact information with SoundExchange. Directly via our services and maybe some coordinated public awareness campaigns.

You can love or hate SoundExchange for many reasons, but we’re all drinking from the same water. While the current landscape sets us up to clash on a lot of issues, there are a few we should cooperate on.

to those that think america doesn’t steal

softwood lumber
owed to canada 5 billion
received 4billion
and conservative stephen harper signed away the othr billion and WOA
next day we won the last appeal to get the other billion
now look at lumber industry in canada
its ok for america to outright steal when it profits them but being when people decide to get even screw them
besides let them whine
there will never be a CDMCA here and we are going to legislate net neutrality shortly
this will make canada a massive innovator compared to the USA.
in 15 years all thats left in the usa will be minimum wage jobs and of course your war mongering army jobs

The difference is that SoundExchanges says they work for artists and ASCAP says they work for the songwriters. All else is the same. The sampling both claim is nonsense. Their accounting of both is confidential. Where the money goes, no one knows.

One is a copy of the other.
Even the bank and investment companies are sinking because of croocked accounting and audits, while the government looks the other way (as it is paid to do).

FBI, where are you?