Exposure or Exploitation?

Mark Cuban's HDNet releases performance DVDs without telling local and national artists -- Is it the price of promotion or an abuse of creative rights?

by Alan Cohen , Mike Orren

On March 11, 2005, a pack of mainstays of the music scene gathered at The Lakewood Theater to play a benefit for David Cunniff, the local man who was paralyzed after an attack at an Old 97’s show at the Gypsy Tea Room in 2004. The 97’s headlined, and were joined by the likes of Salim Nourallah, The Deathray Davies, Spector 45 and Max Stalling. A crew from Dallas-based high-definition televisionnetwork HDNet was in the house filming the show for broadcast on their True Music series. Ticket sales for the concert raised just under $25,000 for Cunniff's medical expenses.

While all the artists wanted to help out, Nourallah especially wanted to be there because he opened for the 97’s the night of the attack and was standing ten feet away selling merchandise to Cunniff’s daughter when it happened. “So when I heard that they were doing a benefit, I asked the 97’s right away to let me be a part of it somehow.” He was unable to round up his usual sidemen for the night so he played his set solo acoustic, even though the venue setup wasn’t conducive for a one-man show. It certainly wasn't the show Nourallah would have orchestrated for a broadcast, but he was just doing whatever he could to help the cause.

HDNet was feeling the love, too. Like Nourallah, they were present with a crew on the night that Cunniff was attacked. That’s why they told the Dallas Observer that they were lobbying the 97’s label, New West Records, to film the show for broadcast. "We just thought it would be great to help out David," head-honcho Mark Cuban was quoted as saying, "and recognize the bands for their efforts and great music as well."

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Fast-forward a year and change, and do a search for Spector 45 on Amazon.com. The only relevant result is the following June 2006 release: True Music: Salim Nourallah, Spector 45, The Death Ray Davies [sic], Max Stalling (2 DVD Set - WMVHD DVD & Standard Definition DVD). It is priced at $19.95 for a two disc set, with the same program in both HD-DVD and standard DVD formats. It consists of interviews and performances from the Cunniff benefit.

Nothing remarkable in and of itself – Spector 45 was only starting to develop a larger audience shortly before its break-up last month, and its indie CD releases were obscure enough to escape even Amazon’s radar. A compilation with other bigger-name acts is probably the only release that would be likely to land on the popular e-commerce site.

Amazon.com

Video shot at the Lakewood Theater benefit for David Cunniff.

What is strange is that Frankie Campagna, lead singer of Spector 45, didn’t know of the DVD’s existence until we told him about it.

Neither did Salim Nourallah. Neither did members of The Deathray Davies. Neither, according to his management, did Max Stalling.

“I always thought they just showed it on TV,” Nourallah said.

In fact, over the past week we’ve attempted to contact every one of the 44 bands featured on the 14 DVDs HDNet released in June. We’ve connected with many of the locals and we’ve reached several of the national acts -- in all, we've talked to representatives of more than a dozen acts that have appeared on True Music. Only one band we have talked to had any idea that the DVDs existed, or were ever planned -- much less that they were available for sale. More than a month after their release, not one of the 44 bands had a single mention of the DVDs on their websites or MySpace pages.

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While none of the bands we talked to expected royalties for their broadcast appearance on True Music, other uses of their performance are a different story. When we told local hip-hop artist Tahiti that he was on an HDNet DVD, he, like many others, couldn't believe he wasn't receiving royalties. "Man, I'm broke as hell," he said. "The least they coulda done is broke a brother off a little something."

But of greatest concern, no one involved in the Cunniff benefit believes that any of the proceeds of the DVD episode culled from that gig are earmarked for the Cunniff family.

We believed that the artists' concerns deserved to be addressed, which then triggered an internal discussion here at TexasGigs about the growing opportunities and risks that both artists and media companies like HDNet, MySpace, YouTube, and even our own organization face in the ever-expanding and medium-agnostic world today. We contacted Jeff Cuban, who runs sales for HDNet, for an interview. He eagerly offered us an interview with his brother Mark instead, and asked us to provide a list of questions via email.

In that email, we told the Cubans, "...While we’ve got some questions about the specific artist rights on these DVDs, we’re not trying to develop a 'gotcha' here – We think the piece is about the tough issues for New Media content creators and distributors, including HDNet and even our own company."

After confirming receipt of the questions and then waiting several days for a response, we again contacted Jeff Cuban. He told us that Mark was unlikely to answer because of our "negative approach.” We then received an email from Mark Cuban trying to turn the issue back around on us, asking how he would be compensated for his participation in the interview, and what rights he would have in its commercialization.

After we told him that he would not be compensated, and that it was in his interest to answer our questions rather than have potentially negative issues unanswered, he claimed we had threatened him and declined to participate.

Given Mark Cuban's public support of corporate transparency via his newly-launched ShareSleuth.com corporate watchdog site and of investigative journalism via his hiring of Dan Rather, we were surprised and disappointed by his response.

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One would think that the release of a 14-DVD series of HD performances by popular and up-and-coming bands would have had some accompanying fanfare. But we haven’t been able to find any reviews; any promotion; any announcement outside Amazon.com. Even HDNet’s site makes no mention of them and they are not offered in the HDNet online store.

Amazon.com

The ad that tipped us off.

In fact, we only found out about the existence of the DVD’s by sheer chance. Mike was testing a new contextual ad unit from Amazon on TexasGigs, and it pulled up ads for the video of the Cunniff benefit. And then, in the course of searching around for more information, we found episodes of True Music available as paid downloads on Google Video.

Based on the heavy use of local bands, we then sought to get some info on the series from HDNet and the bands involved for what we thought was a simple story about cool DVDs of local bands hitting the market.

The problem was that when we contacted bands for information, we got one of two answers:

“What?

or

“What the hell?”

That seemed even stranger in light of the fact that True Music host and producer Katie Daryl told us that bands promoting the show to their fans and other bands were a critical part of True Music’s marketing plan. She said that traditionally bands market their True Music appearances via web, email and MySpace and mention the show in their other press interviews.

When we asked about bands marketing the DVDs, she said: “I should recommend that to Jeff [Cuban]. He should let the bands know when theirs is going up for sale so that there can be a link. But then again, I don’t know if they want to be pushing that.”

We would have loved clarification on who the “they” is in the last sentence of that quote, the bands or HDNet. But, once Mark Cuban cancelled our interview, Daryl would no longer speak to us on the record.

Now before you start fashioning torches out of drumsticks and rallying a mob to converge on HDNet headquarters, let’s be clear on one point: It appears that the company has contracts that grant them the legal right to produce and sell these DVDs. We've seen the language included in many of HDNet's agreements with bands, and it includes a very broad clause about the usage of the material (emphasis ours).

We're not TV people, so we did consider that this might be standard industry practice. Not so. According to Traci Thomas at New West Records, for instance, when DVD and CD performances and compilations from Austin City Limits are sold, the artist is involved and receives royalties for their participation.

Mike Lynn, a partner at law firm Lynn Tillotson & Pinker LLP, looked at the agreement and told us, "I am afraid that the band members [who are unhappy with the DVD] have a serious problem. The language used is both simple and all encompassing. There appears to be no limitation on use of the music for any purpose."

It was clear in the cases of the band representatives we talked to that no one from HDNet ever broached the idea that their performances might be used in any way other than broadcast on the channel -- no suggestion of DVDs for sale; no discussion of online sales through Google Video.

No one we talked to disputes signing the contract, but most said that they had no idea they were signing away rights to anything beyond the original broadcast. While there isn't anything illegal about these releases, the surprise DVDs and downloads underscore the need for frank conversation between artists and content distributors about all the ramifications of agreements before they are signed. They also beg the question of what a media company with broad rights to an artist's content can do with them both in and out of context.

HDNet appears to have legal cover, but these DVDs at best represent an example of inconsiderate corporate communication and poor marketing strategy. At worst, they're a matter of a media company disingenuously “exploiting” the good faith of musicians that are already providing free content -- Forms of the word “exploit” permeate HDNet’s documents and the lingo of its representatives.

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Based on interviews with the bands and other sources privy to the negotiations; as well as HDNet documents, the process of signing bands to appear on True Music has generally gone like this:

Band management would get a call and a friendly letter inviting the band to appear on the show via an interview and live taping of a specific concert, although sometimes this followed a solicitation by the band to HDNet. The letter explicitly talked about broadcast on HDNet, but did not make any mention of rights or usage in any other medium. There was no offer of compensation, nor any suggestion of further redistribution. The benefit to the band is billed as: "Footage...packaged to portray the band at its best in a 6-8 minute segment. In addition to each band gaining national exposure, they also receive a DVD copy of the show which they can use for non-broadcast, promotional purposes such as: digital press kits, websites, myspace, bonus DVD's, etc." No band or manager we talked to remembered anyone from HDNet ever suggesting that the company might resell the performances or use them anywhere other than on the network broadcast.

In fact, we were surprised to find that several bands we talked to remembered being filmed for "a local-access cable show" (exact words) and even today were not aware that HDNet was part of Mark Cuban and Todd Wagner's collection of media companies. That may have been because a number of performances were filmed in the network's earliest days when it had a more limited audience.

True Music w/Katie Daryl: O.A.R., Old 97's (2 DVD Set - WMVHD DVD & Standard Definition DVD) (DVD).

We bought a copy of the DVD, which came in a case whose title matched the order, but the picture on the cover was not of either band, but of a NASCAR personality. And the video had no footage of either band on it, but instead programming from an entirely different episode about NASCAR.

The program description on the back of the box matches what’s on the DVD. And the title/description discrepancy is on HDNet’s episode guide as well.

We called Jeff Cuban’s attention to the Old 97’s DVD mistake in the course of our early conversations. We did tell him at the time that the mistake was not a focus of the story, as we were sure he had a good explanation for it. However, absent answers from HDNet, we do feel the need to mention it, as we wouldn’t want any of our readers to buy it expecting to see the bands advertised. Even though we alerted HDNet to the problem on July 28, as of August 7, the video is still available on Amazon.

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Amazon.com

The strange case of the Old 97's video HDNet records indicate that the episode featuring the Old 97's and O.A.R. had rights which expired in 2005, and that only broadcast rights were granted. Yet one of the DVDs currently for sale on Amazon is: True Music w/Katie Daryl: O.A.R., Old 97's (2 DVD Set - WMVHD DVD & Standard Definition DVD) (DVD). We bought a copy of the DVD, which came in a case whose title matched the order, but the picture on the cover was not of either band, but of a NASCAR personality. And the video had no footage of either band on it, but instead programming from an entirely different episode about NASCAR. The program description on the back of the box matches what’s on the DVD. And the title/description discrepancy is on HDNet’s episode guide as well. We called Jeff Cuban’s attention to the Old 97’s DVD mistake in the course of our early conversations. We did tell him at the time that the mistake was not a focus of the story, as we were sure he had a good explanation for it. However, absent answers from HDNet, we do feel the need to mention it, as we wouldn’t want any of our readers to buy it expecting to see the bands advertised. Even though we alerted HDNet to the problem on July 28, as of August 7, the video is still available on Amazon.

Later, sometimes as late as at the actual taping of the gig, a member or representative of the band would be given a boilerplate contract to sign, and the taping proceeded as long as at least one representative signed, whether that was a manager, a publicist or a band member. Based on the company's rights tracking, it appears that in roughly half the cases, the boilerplate was signed without substantive alteration.

The other half weren't as smooth. A dozen early episodes of the show no longer air because of missing contracts or, in the case of Grand Funk Railroad, outright denial of permission. Don Brewer, Grand Funk's drummer and manager, told us that they knew they were being filmed at a Fort Worth concert in 2002, but that "We thought it was just going to be used for the JumboTron."

Only after the episode had aired multiple times on HDNet did Brewer become aware of it, he said. "After the fact they asked us to sign," he told us in a phone interview. "But we said 'no more use of the thing, period.'" It appears that other shows have been pulled because of missing agreements from The Misfits, Good Charlotte, Sammy Hagar, A Simple Plan, Oleander, Sparta and The Donnas.

In other cases, the boilerplate was altered by bands and management who weren’t buying into the perpetuity clause or broad resale and redistribution. And those bands’ material is not being redistributed online or on DVD. That’s likely why with more than 150 episodes in the can, only 14 made it to DVD. That’s roughly how often an episode aligned with all artists signing the unaltered contract.

More than 250 bands signed off on the contract as-is, either because they were fine with the broad terms, or because they didn't read closely.

“I have to say I was pretty casual about the whole thing,” Salim Nourallah said. “It was kinda like ‘Hey we’re from HD TV and we want to record you live and broadcast it on TV.’ You have to be a bit of a stump if you didn’t agree to that.” HDNet records indicate that Nourallah signed his agreement for the Cunniff benefit on the day of the show.

Some bands we talked to who wished to remain anonymous echoed Nourallah's sentiment, saying that they didn't read the contract, assuming it just gave the rights for broadcast. A couple of bands had to call several members to figure out who, if anyone, had signed. When we asked Katie Daryl about the contract, she was equally casual about it saying that either management or the band could sign. “They look at the contract basically saying they’re not going to sue us and we’re not going to sue them.”

To HDNet’s credit, it looks like they have watched the rights issue closely from a contractual perspective. The company keeps detailed tracking of the rights obtained for every band and every episode. Only episodes where all bands signed the boilerplate without stipulation were released as DVDs in June.

Attorney Mike Lynn says that if any band feels slighted by the agreement, they would have to make an argument based on the representations made by HDNet representatives:

"Usually when faced with an agreement between a sophisticated buyer and an unsophisticated seller...a usual strategy is to look for representations made before the deal was signed that would-could be viewed as a 'fraud' that caused the deal to be signed."

When you're a young unsigned band, are you going to ask many questions or read the contract closely when one of the best-known networks of HD content offers you the chance to be on their music show? You should. If you do make stipulations, HDNet certainly seems to be amenable to letting you state your caveats and restrictions about the use of your content. If not, you’ve given your content over completely to a multimedia organization with interests in film, HD, live entertainment and news.

But it wasn't just young, unsigned bands that signed away the full rights -- the list of bands that HDNet's internal record indicates signed the boilerplate includes the likes of Public Enemy, Blues Traveler, Cowboy Junkies, Eisley, Jack Ingram, Jason Mraz, Maroon 5, Slayer and many other national acts.

"I can't imagine that some of these acts, this caliber, signed something like this," remarked one record label executive who asked not to be identified. "It shows that management, label and artist aren't always in synch."

"They should have known better."

Ron Stone, whose Gold Mountain Entertainment manages Deadman, was surprised by the DVD release. Nevertheless, he said that he was pleased to hear about it and that it would be good promotion for the band.

But when we told him that it appeared there would be no participation in profits for the artist, he said, "Then there will be a problem."

It's not that Stone is taking a hard line. To the contrary, he was very concerned that if our story was too negative it might hurt True Music, HDNet ("the coolest thing ever"), and ultimately artists badly in need of promotion:

"I'm really grateful that we were on there, that they're putting on new, unsigned bands. I'm glad that the DVD is out there...HD is someone we want to support. We're not going to discourage them on this. They give artists a path they can't get anywhere."

"But, if they make money," he said, "the artist and publisher have to participate." When we pointed out the breadth of the HDNet agreement, he replied, "It won't hold up. You have to pay the publisher and the songwriter."

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If HDNet believes that their contract gives them the rights to release performance DVDs for sale without checking with the artists, it begs the question of what else they might want to do with that content. Katie Daryl told us that Jeff Cuban is already working on overseas licensing and that the DVD release was just the beginning. "Sorta like baby steps,” she said. “...Stuff is definitely in the works. Mark has a vision."

Multimedia content is clearly a part of Cuban's vision. He and Todd Wagner's 2929 Entertainment, of which HDNet is a part, is active in news, film production, television, and movie exhibition.

While it is highly unlikely that HDNet could successfully create a secondary market for individual parts of these broadcasts outside of 2929, it is entirely within the bounds of their artist agreement for the company to share audio and video of these performances amongst 2929's properties: in movies, on soundtracks, in documentary programs and even in theatrical release as a concert series. Because HDNet executives refused to be interviewed, we don't know if they have plans to re-edit programs or redistribute material outside the specific context of the episodes as aired.

We do know that, armed with a broad contract, they felt perfectly comfortable selling DVDs and digital downloads of performances shot for True Music without even telling the bands about it, before or after the fact -- even when some of those performances were part of a charity event. We also know that, based on their tracking of rights that future "exploitation" was something they have considered from Episode 1.

We asked attorney Mike Lynn if the contract would allow such broad uses: "Yes," he replied. "It looks that way. Very onesided contract."

Especially in light of HDNet's unwillingness to discuss the matter, the slope looks slippery – and they have contracts from more than 250 bands giving them the right to do everything described above and more with a library of performances that our most conservative estimate pegs at 792 songs. Artists who publish through ASCAP or BMI might have some protection, but given the broad contract, that isn't a sure thing.

Think we’re being paranoid or alarmist? Read the language in the HDNet contract in the context of some of Mark Cuban's remarks about 2929's' approach to the entertainment business.

Last year, Cuban talked to Cinema Technology blogger Scott Kirsner about plans to diversify programming in movie theaters. "We’re open to anything and everything. We’ll try to learn and get smart about it. The fact that we’ll have digital cinema in there means we can do live events...We haven’t done any concerts, but Regal has, and they’ve had sell-out audiences for concerts. I think that’ll change the movie theater business."

If 2929 wants to show any of these concert performances in a movie theater, the rights won't cost them a nickel.

In the same interview, he talks about repurposing content across mediums, in this case film and TV. "When we’re programming HDNet, what shows are we going to run? If we’re going to have to buy shows, let’s buy shows that are extensions of the properties we already own."

Absent their response, we’ll go ahead and make a argument in defense of HDNet— They invest significant resources in capturing HD video of a concert – a three-camera production and high quality sound mix isn’t cheap. They are unlikely to make big bucks trading on a performance of an up-and-coming band. And no one else was knocking down Spector 45’s door to put them on national TV. Can it be argued that the promotional benefit to the band is ample compensation and that resale of the content is just another way to recoup HDNet’s investment?

Katie Daryl thinks so. “I don’t want to think of us exploiting bands because we don’t pay bands,” she told us. She sees the show as a great mutual backscratch.

“We are hungry for content and True Music is ready to expose bands to people.”

Ryan Beck thinks it's fair too. He's manager of Hog Legg Ellis, the only band we've found that was expecting the DVD. By email, he told us:

"It was something we agreed upon with HDNet and Budweiser. Artists have to forego any 'rights' 'mechanically'- meaning the artist signs over all rights for their broadcast and anything else that HDNet chooses to do with that broadcast or any future broadcast. Typically TV rotation pays very well but you trade the money for exposure- so its a great deal for a working artist. That show alone promoted Hog Legg in numerous countries that we wouldnt have sold CDs in. So its a win-win for artists that aren't greatly established to 'jump on' if they call you. So we did and it worked to everyones advantage."

Finally, take the situation in the context of recent flaps over artist rights on MySpace. British singer Billy Bragg pulled his music off of MySpace in May because of the expansive rights buried in the fine print of that site’s user agreement, and thousands of others followed suit. That agreement gave MySpace the right to "...use, copy, modify, adapt, translate, publicly perform, publicly display, store, reproduce, transmit, and distribute..." content placed on the site. Although MySpace execs defended the agreement as necessary to allow all of the site features to work legally, they eventually capitulated, toning down the language. Bragg and many other artists returned.

YouTube has similarly broad rights:

"...A worldwide, non-exclusive, royalty-free, sublicenseable and transferable license to use, reproduce, distribute, prepare derivative works of, display, and perform the User Submissions in connection with the YouTube Website and YouTube's (and its successor's) business in any media formats and through any media channels"

Many content creators are going to great lengths to keep their content off of YouTube because that service does not offer a revenue share to owners of video content. Other services, like Revver, pay a percentage of ad revenue back to users whose videos drive a lot of traffic. The producers of the popular Diet Coke/Mentos viral video have urged fans to keep it off of YouTube and Google Video, which shares no revenue with content creators. They estimate that they have made more than $30,000 off the video on Revver.

The question of balancing rights with promotion and expediency is a knotty one. In a recent BBC commentary on the artist rights, noted New Media scholar Bill Thompson asks:

"While the details of licences and terms and conditions may not seem to matter much, copyright and the assertion of those rights are vital in all sorts of areas. If you're an unsigned band who then makes it big, do you want YouTube putting out all of your early videos on a compilation disk without having to ask you?"

Artists can pull their material from YouTube and MySpace. True Music's agreement grants them no such rights.

Can HDNet be compared to online promotion services, though? Is providing server space and a Flash player the same as dragging out expensive HD video and high-end audio equipment and broadcasting over a network? In scale it certainly isn't. Is either scale or medium the differentiator?

Mark Cuban doesn't seem to think so. By email, he seemed to suggest that our view of artist rights on these videos should apply to the subject of a news interview:

"Before I answer any questions and provide content for your commercial enterprise, I would like to know what rights I have to the content and what participation I have in the economics. Am I to do this purely as an altruistic effort that benefits your company, or is there some value to me or the companies you reference that I'm not aware of?"

We think it is clear that there is a difference between answers to questions about one's company in an interview and performances of copyrighted works of art.

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While artists we spoke to had varying degrees of reaction to the surprise DVDs, ranging from shrugs of indifference to outright rage, there was one matter to which all parties took exception: The David Cunniff benefit.

"They don't have authority to do this," said the Old 97's Ken Bethea when we asked him about the videos. Andy Mendelsohn, who manages the Old 97's and whose company, Vector Management, was involved in planning the benefit told us, "If they're profiting from the Cunniff situation, that's disturbing." He said that HDNet approached the band for permission to film the benefit, but never suggested any sort of financial arrangement regarding the broadcast; nor discussed any future exploitation. (Katie Daryl says that the Old 97's approached HDNet and asked them to film.)

"We were receptive to the promotion the show could bring, and were excited about their participation to have a media partner," Mendelsohn said. "We're equally disturbed [as the bands] that the DVD is a misappropriation of funds that would have gone to David."

Traci Thomas of New West, the Old 97's label, says that New West was also involved in the benefit -- She, too, was at the show where Cunniff was attacked -- and thinks the DVD absolutely should not have been made without the interested parties' input.

"But," she says, "If they're giving the money to David, we might overlook it."

Jason Garner of The Deathray Davies told us "I think it would be great if some of the money could go to David Cunniff. Yeah, I mean that's what the whole night was for."

“I think the thing that troubles me the most,” Nourallah said, “is that it was related to the benefit. The other shows, I might be bothered by it [not knowing that the performance would be sold on DVD] but not as concerned as about the fact that we’re talking about a show that was done to benefit David Cunniff. Now if they’re selling these DVDs and cutting David Cunniff a check every month, then wonderful. They should have asked us and all that, but if the money is going to him in some way than I don’t have a problem with that–I doubt that is happening."

A member of the Cunniff family told us that David doesn't like to talk about the attack as he is trying to put the whole episode behind him. However, his attorneys at the Law Offices of Stephen F. Malouf were unaware of the DVDs before we contacted them, and Kristin Collett, Malouf's assistant, said they were unaware of any compensation arrangement between HDNet and the Cunniff family.

The DVD culled from the benefit makes no mention of Cunniff. On the DVD Katie Daryl does ask Max Stalling a question about playing other benefits, and mentions a couple times that the bands are playing for free -- But there is no mention of the cause, no discussion of what the night was about, nor any mechanism for viewers to contribute to Cunniff. There is no indication on any of the materials or promotion that any portion of the proceeds from the DVD will go to anyone other than HDNet.

So, unless it happened without the knowledge of Cunniff's attorneys, the bands who played, and the folks who planned the benefit, HDNet contributed no cash to the cause. It's questionable what promotion value HDNet provided, since the DVD is of a program that doesn't mention the benefit. At the same time, they got free content from four bands for a show that has aired multiple times on HDNet and is now being sold as a DVD. HDNet's rights-tracking sheet refers to that gig simply as "Lakewood Show."

Every artist, manager and label executive we spoke to felt that any proceeds from the concert, including resale of the program on DVD (or "in any and all other media now and hereafter known, throughout the universe and in perpetuity") should be directed to Cunniff.

“I thought that was the whole point of the benefit,” said Nourallah.

Blair Lovern contributed to the reporting for this story.