Piracy Killing Record Labels?

Posted By: Mike Waterman · 4/3/2013 5:06:00 PM

Can a Music Leak Sink a Corporate Ship?

Rolling Stone magazine says recording artists are paying as much as $25,000 a month to combat online piracy. The article says that pre-release piracy has become such a problem that it was made a felony in the United States! (I hope the magazine doesn’t come after me for using that sentence without quotation marks and accreditation…and for adding the exclamation point!) They go on to say artists lose everything from sales revenue to creative control over how their music is heard, because early leaks aren’t always mastered the way the final album will be. (I changed that sentence a little, so—if you read Rolling Stone—you won’t think I copied it word-for-word!)

Leaking music is nothing new—it’s been happening for decades. Before the deregulation and consolidation of radio began in the 1990’s, radio stations actually competed with each other in the same format! There was a race to get the new music on the radio before anyone else. In the 21st century it’s unusual for a radio station to even have a direct competitor. Everyone carves out their own niche in broadcasting, avoiding head-to-head competition in most instances.

In the 1970’s it was not uncommon for two—or even three—stations to play the same music. The differentiation came in the presentation and marketing of the stations…major contests during the Arbitron rating periods to get listeners to spend time with your station (at least while you were giving away great prizes).

For stations playing new music, there was always a competition to get your hands on a record by a top artist before the “other station” did. Being the first to play a song that would become a top seller made you a leader. The theory holds that listeners would think of you first when they wanted to hear the trendiest, new music. You would be “top-of-mind”—which is the key to being successful with the Arbitron ratings game. Radio program directors formed friendships with artists, record labels and promoters in the hopes of getting new music first. In order to keep everyone in radio happy, record labels would try to make sure that everyone was serviced on a new record simultaneously. That way no one would feel slighted.

In 1978, Rod Stewart was one of the hottest singers in the world—platinum albums, sold-out tours everywhere. One of Rod’s guitarists was a friend of mine named Billy Peek. He was arguably the most respected guitar player in St. Louis. Billy had been a protégé of Chuck Berry who was hired by Rod Stewart after Rod and Ron Wood watched Billy appearing with Chuck on the Midnight Special TV show. I met Billy through the radio station I was working for at the time. I invited him to be a guest on my show…to talk about being part of Rod Stewart’s band, and to promote his local solo gigs when he wasn’t touring or recording with Rod. Beyond that, I wanted to play drums with Billy when he was in St. Louis! He became a regular guest on my show, and he and his wife (at the time) became friends with my wife and me.

We were at Billy’s house on Halloween in 1978 when Billy showed me a cassette tape. He said it was a recording direct from the master tapes of Rod’s new album, which was scheduled to be released in a few months in conjunction with the next tour. Each band member was given a cassette to familiarize himself with the new songs on the album. We listened to the tape and one song jumped out at me as an obvious monster hit! 1978 was the height of the disco era, and rock artists who could combine disco and rock were experiencing continued success (such as “Miss You” by the Rolling Stones). The song on Rod’s album was “Da Ya Think I’m Sexy.” Great lyrics, memorable synthesizer line…it was a sure thing!
I asked Billy if I could borrow the cassette and play the song on the radio. He was reluctant because the album hadn’t been released and there were licensing issues…not to mention that no other radio station in St. Louis had access to the album. I don’t remember what finally convinced Billy that it was okay to do a “sneak preview” of the record…maybe an extra glass of wine, or the recognition of his accomplishments by his home-town audience.

The station I worked for—KSLQ—was owned by the Bartell company, who had several stations around the country…most notably KCBQ in San Diego. With San Diego’s close proximity to Los Angeles, many San Diego stations effectively penetrate the L.A. market. And we weren’t content to play the new Rod Stewart album in St. Louis! We made high quality copies for every Bartell station.

We didn’t want Billy to get in trouble for leaking the record, so there was no mention of where the tapes came from. Our chain of stations had scooped everyone on what would become a multi-platinum-selling album called “Blondes Have More Fun.” Program Directors of stations around the country were furious because their competitor was playing music that had not even been released. I suppose the label expedited the release of the album, so everyone would have it. Everyone involved in the leak denied knowing where the tapes came from.

To add to the label’s embarrassment, their new Director of Singles Promotion had been the National Program Director for Bartell and had moved to L.A. from St. Louis. I don’t know if they accused him of favoring his former employer by leaking the tapes, but he never seemed bitter about it. A few months later, KSLQ hosted a concert by a then-unknown (in the Midwest) band called the Talking Heads. The show bombed, but we hung out with the band after the show for photos (except for David Byrne—who didn’t come out of the dressing room until the limo arrived to take them back to the hotel). The label representative—our former boss—coyly asked if we knew anything about the Rod Stewart leak. I felt that he (at least) admired our competitive spirit and ingenuity.

Critics hated the album (accusing Rod Stewart of “selling out” to disco), but fans loved it. Rod has sold over 100 million records during his career, so I don’t suppose the leaking of his album that was then released in 1979 had a negative effect on his career.

None of us benefited financially from possessing the tapes. We were only interested in the competitive aspect of airing a record before anyone in the country, and being the station our listeners could rely on for the newest music. Looking back, maybe I should have just duplicated the cassette and sold copies out of the trunk of my car!

Here's a link to the biggest hit from that album--Billy Peek is the guitarist wearing the beret in the video:




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