BMI For Profit

[SLEEPTLKER]

Just got an email outlining BMI’s plans to invest heavily in their business in the coming years and become for profit. I see they have Goldman Sachs involvement/consulting as well, curious to speculate on how this affects BMI creators?

[Music1234]

Just received a newsletter that BMI is now shifting to “for profit”. The reality of that change is much bigger than we all may realize. They are now in the business of paying out as little as possible to publishers and writers so they (BMI) can be more profitable. I mean, is this not logical? What is their biggest barrier to earning profits? I’d have to say that it is royalty payments to writers and publishers. Seems to me that wall street greedy folks have been keenly watching the slush fund and have been whispering ideas to the powers that run BMI to eliminate “Not for Profit”.

I tend to think Not For Profit is a better model for writers and publishers because the very idea of not for profit is to maximize distribution of royalties to their members and preserve as little as possible to admin staff, the board of directors, VP’s, CEO’s etc. For Profit is a game changer for BMI. If they are going to “For Profit” then they should attempt to issue shares of stock that all members can buy so everyone can enjoy the profits together.

Also, Vlad, if your foreign ASCAP statements are stronger than your domestic statements, you may want to stay put at ASCAP. BMI does seem to pay better for domestic network and cable shows, but ASCAP seems to pay better with foreign collections. ASCAP also issues 8 payouts a year, and if you have an ASCAP pub entity you are getting 16 payouts a year. BMI would only be 4 distributions or 8 (if you have a BMI publishing entity set up). It is a tough decision.

[LAwriter]

Yeah, the new “FOR PROFIT” thing with BMI is a serious, serious bummer. It means less for writers / publishers. They might as well have just said that. All the “excuses” and “reasons” in the letter were totally bogus IMO. How about something serious like implementing watermarks into their workflow. Oh wait,,,,,yeah,,,,that removes the opportunity to move money around and make bigger profits for them. This is a bad time upcoming for BMI writers.

[Art Munson]

Shall we all start speculating on this and what it means? Sounds warm and fuzzy but probably less money for us “affiliates”.

[LAwriter]

I’ve only got two words to say :

Goldman Sachs.

[Music1234]

Maybe these new IT investments they want to make will serve affilates after all. After reading these articles and listening to the CEO comments, I will keep an open mind. The good news is that they continue to bring in record amounts of revenues. There seems to be a desire to invest in IT, which I assume would be more transparent broadcast tracking of music used on TV and streaming. Perhaps we will all get better data on how our music is streamed, broadcast, etc. I am very impressed by what Identifyy has done with their Content ID Tracking technology. They essentially have achieved 100% transparency for how our music is used on YOUTUBE. We can now literally watch and hear every video on YOUTUBE that is monatizing/ claimed back to us. This kind of detection service is what we all want and need. And not just for TV broadcast, but for Netflix, Facebook, Instagram, Tik Tok, Spotify, Apple Music, Pandora, etc. We now see usage data via our statements, but do we really feel confident in the accuracy of the data we get? Perhaps these new investments will lead to improved, more accurate, transparent data for all music creators. The CEO refered to “the old model” many times in his comments. Maybe that means humans entering track titles on cue sheets will go away and be automated by IT, fingerprinting sound recordings, etc…..

I also found it fascinating how the company was for sale

“Citing sources, Bloomberg reported at the time that the music rights collection firm set a price tag of up to $2 billion or $3 billion for certain potential buyers and that BMI executives had hoped to sell for at least $1.5 billion. BMI enlisted Goldman Sachs as an advisor in March to help review strategic opportunities.”
He added: “The one thing we continually heard throughout that process reinforced what we have been thinking for some time: the need for us to invest in BMI and operate in a more commercial and forward-thinking way. Growth requires investment.

“And in this new model, we can now structure, fund and operate new strategic opportunities, adopt new technologies and enhance and expand our services and products in a way that under our old model would have come at the expense of distributions.”

Elsewhere in the note to BMI affiliates, O’Neil argues that while the business model shift “is a big change”, the former model “held [BMI] back and limited [its] ability to invest in the future in a meaningful way”.

https://www.bmi.com/news/entry/bmi-grows-revenue-and-distributions-to-record-levels-during-unprecedented-y

https://www.yahoo.com/entertainment/bmi-changing-profit-business-model-150918527.html

After scrapping sale plans, BMI transitions to a for-profit business model

[bas1236]

I’m with Music1234 on this follow up post. “Perhaps we will all get better data on how our music is streamed, broadcast, etc.” … has BMI “non-profit” entity been that great? All I ever see here is complaining about how s***ty BMI is, lag time, non responsive, not getting paid for stuff we see on Tunesat, etc., etc., etc. SMH

[Author]

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