Sound and Spirit

[LexingtonPethead]

Both Bills may be right, but the way I see it, I want Petra to get credit for selling CDs, so I bought my copy of J&H from Family Bookstores.

Plus, I have purchased several Petra CDs that I didn't have through ChristianBooks.com. At least that way, the sales count.

If the labels see that Petra is a good investment, Petra will be a desired band in the view of record companies. This can happen if sales get recorded. If sales occur but aren't accounted for, it makes it look like Petra cannot sell, which is not the case. I think buying CDs through book clubs is almost as bad downloading MP3s from Kazaa.

[Bill F]

Lex, I disagree with comparing music clubs with Kazaa. The big difference is that one is granted the legal right by the label to produce them, the other is theft. I'm not sure if those rights vary in price due to the demand for the artist or not. I still believe any promotion of Petra is a good thing, as long as it is legal.

[LexingtonPethead]

I was speaking from the perspective of what will benefit Petra and further their ministry. If I can buy my Petra CDs from a valid Christian retailer that reports sales of Petra, then they are not invisible from the record companies who are the ones who make the CDs in the first place. Without Petra's ability to secure recording contracts, you would have no Petra CDs in your collection. If you buy your CDs from Sound & Spirit, if in fact they do not report their sales, you are accomplishing as much for Petra as the person who freeloads with Kazaa. That was my point.

Sure, one is legal and the other is not. I don't think it really matters when you consider the ultimate impact it has on the band. The only difference is that with one you could get sued for.

I will give you the point that at least people will see a picture of the CD, and that gets exposure for Petra. However, if someone actually orders from the book club, the loss of revenue and contract justification for Petra makes it counter-productive.

[executioner]

This is how it works from the IRS standpoint. We count in the books the sales #'s that are bought from the manufacturer. We in no way count the amount sold to the consumer, but we count the amount sold to the retailer. The actual sales of a CD are recorded when the retailer buys them from the record company NOT when you and me go out and buy a CD. Columbia House and BMG buy their copies like any other retailer and YES they are recorded at that time. I work for the IRS in the division that record all these items, believe me it is a very slow and long process.
Soundscan is used to benefit the retailer and not the artist or record company. That is how the retailer keeps their books in order. They are paying soundscan to record these items.

[LexingtonPethead]

Columbia House and BMG buy their copies like any other retailer and YES they are recorded at that time.

Just to clairfy, Exe, when you say "they" are recorded at that time, are you referring to the music being pressed into a CD, or are you referring to actual sales being recorded and credited to the artist? Others, like myself, may understand "recorded" to mean production, although I think you're referring to sales.

[executioner]

I'm sorry I can see how that could get misinterpeted. The sales are recorded at that time, not the actual music itself. I would think that all of JAH was pressed at the same time, and then will be determined later if more need to be pressed.

[BillDD]

From dealdude.com

What's the deal with those 12-for-1
mail-order CD club offers?


You've seen the ads. "12 CDs for the price of 1!" they promise. "Nothing More to Buy � Ever!" To join, you pay the price of shipping and handling for 12 compact discs, about two bucks each. You then agree to purchase one additional CD, or five additional, at full price. How can the clubs afford to do that?
The two major players in the mail-order music business are Columbia House and BMG Music Service. (U.K. residents may join the Britannia CD club or DVD club or the Sounds of the Sixties club from Time-Life.) CD clubs sell millions of discs each year, and give away millions more. The standard Columbia House offer requires you to buy at least two CDs; BMG asks that you buy one. The clubs press their own CDs, tack on shipping and handling fees of about $2 per CD, and work out special royalty deals with the labels, but the real profit comes from people who buy CDs or cassettes at full price beyond their membership requirements.

Music clubs buy the rights to make the cds, they don't buy the cds from the labels, how could they possibly make any money if they did that? Remember that it costs about 18 dollars for a store to buy a cd, but it only costs about 49 cents to press one. I don't know about the IRS, but you're way off on most of the other stuff, like soundscan releasing sales numbers a week ahead of time, what? sound scan can see into the future?

[executioner]

Actually I meant to say that the record label releases #'s of new releases a week ahead of time to give them some good press. Soundscan just releases the #'s to benefit the retailer.
On the other point about the music clubs. Columbia House & BMG Ent. are owned by record labels, and they do some manufacturing, but they still have to pay for each copy sold or in this case given to the consumer. So in otherwords the 2 divisions of these record labels are not money making divisions, they are used to get publicity for their product. Businesses have been doing it this since the beginning of time.
On the subject on how much it costs to buy CD's. First of all it depends on the retailer. Retailers like Best Buy and Walmart get their copies at cheaper price $4-5 because they buy in bulk, but most retailers get their at about $7. So you are way off on the $18 bit. You will notice that Christian Music Stores are a little higher price wise, because they buy fewer copies. I don't mean to sound abravise or act like I know it all, but I do know what I'm talking about, this is my life.

[TerryB]

My understanding has been that the music clubs are generating their own copies from masters provided by the label. The club negotiates a price for the use of the master and how many copies they can make from it. It's obvious that they generate profit from lower overhead costs and cutting out the "middle man" per se. The high shipping and handling costs people pay for the clubs basically cover that expense.

When it comes to what the artist makes off the sale of a music club copy that gets complicated based off of their contract with their label. In general an artist per their contract is paid for each album sold whether it's through a club, store, live show, etc. The clubs must maintain precise records in order for it to be determined the royalties that need to be paid. Remember those royalties have to be determined for not just the artist, but also to writers and sometimes the producer depending on his/her contract for that album. Again recording contracts can be very complicated so what may apply for one artist may not apply to another.

In my opinion it's likely those club numbers are tracked in final sales numbers to determine sales certifications, but I am not sure if they end up in Sound Scan numbers.

TerryB