BEVERLY HILLS – A group of independent record labels and small businesses that serve the recording industry believes jobs will be lost if recording artists are allowed to break their contracts before labels recoup their investments.
The newly formed group calling itself the California Music Coalition said Tuesday its members oppose efforts by high-profile musicians to repeal a state law that prevents recording artists from terminating contracts after seven years.
The group is backed by the major record companies. But the smaller labels and companies that press compact discs, make packaging and even provide limousines fear hundreds of jobs will be lost if the law is repealed because labels will not have enough money to nurture and support new acts.
“We’re already in a soft economy, we’re already experiencing cuts and we can’t afford to lose any more jobs,” said Gary Suzuki, who operates a printing press at Ivy Hill Packaging in Vernon, a company of 250 employees that prints inserts that accompany CDs.
Smaller companies believe it’s unfair for successful musicians such as Don Henley and Courtney Love to paint the major labels as villains who force artists to produce recordings and refuse to let them seek more lucrative deals elsewhere.
Henley and other artists claim the California law is unfair because it binds musicians to contracts longer than it holds other people who work under so-called “personal services” arrangements.
The exception was granted after record labels argued it often takes as many as seven recordings, which can take more than seven years to produce, before they recoup their investment on artists.
Most recording contracts require a certain number of recordings from artists, regardless of how many years it takes to produce them.
Henley and other artists, including Billy Joel, No Doubt and the Dixie Chicks, were performing a series of benefit concerts Tuesday night in the Los Angeles area to benefit the Recording Artists Coalition. The artists are demanding new relations with record labels, including fairer contracts and more oversight of accounting practices.
At a time when record sales are plummeting and profit margins are thin, the record companies want assurances that the millions of dollars they spend to promote and nurture new acts will be repaid from the profits generated by the few musicians who find major success.