Digital Music News has posted some charts from Chuck D.’s lawsuit of how UMG calculates artist download royalties.  According to these charts, a UMG artist is paid $0.08 on a $0.99 download.  Why is this so low?  Part of the reason is that UMG takes a “container charge” deduction for these downloads.  A container charge is basically code for a “packaging deduction,” or in other words, the deduction labels would take for the cost of packaging (jewelcases, etc.) on actual physical product like CDs.  Why is UMG taking a packaging deduction on digital downloads that have no packaging?  Because they can.  They also take several other bogus deductions to make this entire calculation ridiculous.  I’m not saying every UMG deal is like this, but at least this one is.

On the other hand, artists distributing through TuneCore get $0.70 on a $0.99 download.

And people wonder why my clients like to be, and why I advise them to be, DIY.

View the accounting charts here.

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Erin M. Jacobson is is an experienced deal negotiator and a seasoned advisor of intellectual property rights who protects artists, songwriters, music publishers, and other music professionals. Her clients include Grammy and Emmy Award winners, independent artists and companies, and distinguished legacy catalogues, as her knowledge of both classic music and current industry practices places her in a unique position to protect and revitalize older catalogues. She handles all types of music industry agreements, with an emphasis on music publishing. In addition to being named a Super Lawyers Rising Star and one of the Top Women Attorneys in Southern California, Ms. Jacobson is a frequent author and speaker, and has been featured in publications, including Billboard and Forbes. She also is on the Board of Directors for both the California Copyright Conference (CCC) and the Association of Independent Music Publishers (AIMP).