Private music teachers, I’d like to propose a business deal. Here are the terms:
- You compose a musical work, put together and record a well-researched presentation, write a major article, make a music recording, or some other high-quality creative product.
- You upload it to my website.
- You get a one-time payment of $100.
- Your creation adds huge value to my subscription-based website, and I collect tens of thousands of dollars in revenue resulting from content like yours.
- You get 0% royalties.
- I do not advertise on my website how many subscribers there are, let alone how many times your creative product was viewed by subscribers, so only I know exactly how much I profit from your content.
- You still own the rights to your uploaded creation. As long as I get all the money that results from your uploaded creation, you can have all the rights you want!
- You are awarded with the honor of being on my website. This is even better than when musicians are asked to play for free at various events in order to give themselves exposure. Add it to your resume! Again, I’m the one directly profiting from your honor and fame, so we’re good!
Sound like a good deal? Excellent. While you’re at it, spread the word. Let Yuja Wang, Phillip Glass and John Williams know about this great opportunity to make themselves a small payment and professional pat on the back from their hard work while I am showered with money.
Sound ridiculous? Does this even sound impossible? Actually, there is a chance that you have already supported this business model as a consumer. Even more scary? Many big names – people you would immediately recognize – have already contributed their precious works to this type of business model.
As you must know from the title of this article, the business model I’m referring to is the online music teacher conference. A few years ago, I received a personal invitation to give my “Art of Rubato” presentation as a “live” video presentation for a brand new online conference. (I put “live” in quotations because the presentation would be recorded and made available for subscribers to view in the future. Potentially, many who viewed my presentation would be viewing it from the website’s archives.) The invitation stated that the goal of the conference is to bring a national conference to teachers via the Internet, including both educational presentations and showcases and an online exhibit hall, allowing those who cannot normally afford to attend conferences (due to travel expenses) to “attend” sessions, and offering teachers who normally attend conferences an opportunity to learn more.
I declined. Most likely, your gut feeling is already telling you that something is wrong with this picture. Let’s take a closer look at why.
Primary creations vs. secondary creations
Let’s first coin a couple of new terms. Rather than offering literal definitions, I’m going to define these terms with examples:
- Primary Creation – an Evgeny Kissin CD, a John Grisham novel, a composition of Beethoven, a Harry Potter movie, an episode of NPR’s Science Friday, or, of course, a video of a presenter’s presentation.
- Secondary Creation – a website advertising Nike shoes, the graphic design for a flyer advertising a concert, audio engineering for a CD, fingering and other editing of a sheet music edition, music or voice acting that is to be used in a video game, computer animation that is to be used in a new Pixar film, etc.
Secondary creations are sold for a one-time fee, while primary creations get royalties (and possibly an up-front fee on top of it). It is not acceptable, let alone conventional, to pay someone (especially someone who is renown in their field) a single lump sum in exchange for a primary creation, especially when that lump sum is negligible compared to the revenue it generates for the business. A clinicians’ presentation is most definitely a primary creation, unless the presentation is 1) a very low-quality presentation that only took a few hours to throw together, or 2) a “showcase” presentation (a commercial presentation advertising a product).
Non-profit vs. for profit
There is another force at work here that even more easily eludes explicit understanding. To explain, I’m going to add some more bullet points that can be included in the list above:
- Since I’m in the business of education… no, even better, since I’m in the business of music education… wait, still even better, since I’m in the business of music education mostly for those who otherwise can’t afford music education (all three of these things make my business sound so charitable!), hopefully you’ll assume that my work is charitable. Maybe you’ll even assume I’m a non-profit organization kind of like the Music Teachers National Association (MTNA) when in fact I’m just a for-profit business. By so generously sharing your presentation at this conference, you are making the world a better place, and by “world” I mean “my bank account.”
- I can’t take advantage of this charity illusion if pronouns on my website are first-person singular. That is why my website uses the pronouns “we,” “our,” and “us” instead of “I” and “my.” This should reinforce your natural assumption that “we” are a team of non-profit charity workers rather than a sole person keeping most of the revenue that “we” (and by “we” I mean everyone but myself) generate.
- You aren’t the only one who gets to partake in the joys of surrendering all percentage shares of revenue to me! The people to whom I contract various regular responsibilities (i.e. the people who make it so I’m technically telling the truth when I use plural pronouns on my website) also only get paid in small lump sums that have nothing to do with subscription numbers, just like you! Here, we are all about “we” as long as we’re not talking about money!
This leads us directly into the issue of transparency.
Nowhere on these for-profit websites does it say how many people “attend” the conferences each year or how many subscribers there are. This is in stark contrast to the MTNA, for example, which proudly boasts phrases like, “We expect nearly 2,000 attendees” in brochures and other advertising materials. (Attendance over the years has hovered consistently right around the 2,000 mark.) This attendance information would allow you and me to calculate how profitable the business is and, in turn, calculate the degree of exploitation of the presenters. Thus, while the transparent non-profit organization eagerly shares its attendance numbers, the for-profit business is not so eager.
Consider what it means to exploit. A person is exploited when they generate value for a business (call this value ‘v’) that exceeds what they are paid (call the payment ‘p’). The degree of exploitation depends on just how small “p divided by v” is. A value of 1 or more translates to zero exploitation since the person is being paid as much or more than the value they generate. When the p/v value drops below one, we start to approach exploitation territory. At what value of p/v does conventional profit earning start to become exploitation? I’m not sure if I know exactly where to draw the line, but no matter. Let’s just say that when p/v is sufficiently small, we don’t care where the line is drawn since it is so far beyond any reasonable line.
As of 2017, I know of at least one online conference that rakes in around $30,000 in annual revenue from around 200 subscriptions along with several exhibitors for the online “exhibit hall” who pay $300 each. This revenue doesn’t include whatever is made through showcase sessions, which go for $200 each. The presenters are only paid $100 each, which is only one-third of one percent of the revenue their presentations are generating! Collectively, the presenters only get an 8% share of the generated revenue. A p/v value of 0.08 is a miniscule fraction, certainly far beneath any “line” we might draw in an attempt to define when profiting becomes exploitation. As the online conference attracts more subscribers, the p/v value will drop even more, assuming presenter pay does not change (no reason to assume it will change since it has stayed the same for years). Even generously supposing this business spends a whopping $5,000 per year to advertise via Google, Facebook, AMT, Clavier Companion, etc., this only raises the p/v value to less than 0.10. A few thousand dollars of overhead is just a drop in the bucket when you’re raking in this much dough.
A bricks and mortar conference such as the MTNA conference has some massive overhead facility and insurance costs, not to mention paying judges for the numerous final-round competitions held at the conference each year, the keynote speaker, paying conference artists to perform, etc. It also doesn’t help when hotels charge outrageously for things such as extension cords, let alone receptions with finger food. The conference registration price in this case shows true function born of necessity rather than an arbitrarily high price based on “what the market will bear.” What overhead costs does an online conference have? Web hosting (typically $100-$200 per year), domain renewal ($15-$20/year), webcam conference calling (usually a small one-time fee, sometimes free for those who only use it once a year), maybe a few plugins and other external services to complement the website, and advertising. No facility cost, no competition judges, no conference artist. Online conferences operate literally at pennies on the dollar.
But what about the non-profits, who often don’t even pay presenters at all? Aren’t they exploiting presenters? No, they aren’t. The difference lies in the fact that a non-profit organization must make its three most recently filed 990 forms public record, which shows revenue, expenses, salaries, etc. Public disclosure means that revenue not going into presenters’ pockets is being reinvested into the organization’s mission statement rather than padding a single person’s bank statement. It means that disgusting profits cannot be made by any one member of the organization without the fear of public humiliation when everyone finds out. This forced public transparency is precisely what makes people trust a non-profit organization enough to freely give money to it, or to freely share their precious primary creations with it. Although there is some leeway when it comes to what “fair” compensation is for those running a non-profit, salaries for non-profit executives tend to be magnitudes lower than their for-profit counterparts, because, you know, contributions of time and money tend to plummet when donors see their gifts being converted into double-payments on a personal mortgage.
If there is truth to the idea that we teachers tend to be underpaid, this business model is certainly not helping. This kind of for-profit exploitation of our colleagues is degrading to our profession and is a great insult to the amount of time and energy that goes into any primary creation.
What, you’re still sitting on the fence? Allow me to attempt to nudge you over the fence with one final point that you simply cannot resist:
- Look at all of my competitors: they are all non-profit organizations: MTNA, NCKP, NFMC, and NAfME. Surely, with the charity illusion I’ve already set up, this must mean that if you present for my conference, you’re doing charitable work? What was that, you want to see my form 990? Yes, I thought the year 1990 was a great year too. Nice weather today. Did you see the Yankees game last night?
What should we do?
If you love and value your community of esteemed colleagues as much as I do, the solution is simple: do not participate in a business model like this, either as a consumer or a presenter. Music Teachers National Association (MTNA) already offers webinars, and I hope (and expect!) these to grow into something bigger, possibly tying directly into the annual MTNA conference each year. If you are considering participating in any online for-profit conferences, please make sure that it does not exploit presenters. In other words, a large majority of all generated subscription revenue is shared with presenters who have contributed presentations that are not commercial in nature. Those who contribute presentations that help to sell sheet music, technique videos, apps, etc. are getting free advertising, so royalties need not be shared with them.
While it may appear to be a big change, increasing presenter pay to $200, $500 or even $1,000 still makes exploitation all too easy. How difficult will it be for a business like this to eventually get 400, 600 or 1,000 subscribers? Even with only 400 subscribers and presenters being paid $1,000 each, we still have that presenters cumulatively only receive about 50% of the revenue their content is generating. It needs to be a healthy majority percentage, because any “fixed” pay for presenters means that the business owner’s revenue will go up each year while the presenters’ percentage share of revenue will go down.
Ideally, the majority percentage shared with presenters should also go up logarithmically each year as the business gains more subscribers. The royalty share could be capped at somewhere between 85-95% depending on how many subscribers there are. Ironically, this isn’t just the right thing to do for presenters, it’s also the smart thing to do for the business owner. This would make this business a lot more like other businesses that are hugely successful because they charge people what their ongoing labors truly warrant (and therefore attract massive numbers of people). Think of credit card transaction fees, Amazon marketplace and eBay fees, Paypal fees, etc.
Other for-profit business models that deliver primary creations to the public give royalties to creators. I hope others will take a cue from me when I say that a for-profit business so willing to exploit the most admirable people in my field will never see my support as a presenter, attendee, or blogger.
(c) 2017 Cerebroom