But just moments after filing that story, we started hearing from unhappy indies. The reason is that Apple negotiated the 90-second clips with the majors first, then 'remembered' to negotiate with the publishers, and then essentially told the indies what was happening. But many of these these indie-repped songs are not fully controlled, meaning that third-party publishers are present.
Now, indies are being forced to quickly make changes to accommodate gratis mechanical pass-throughs. “Not the least of our problems is how to amend 475 contracts (our content providers) to allow 90 second previews," BFM Digital's Steve Corn told Digital Music News. “Most of these are 30 seconds and some are 60 seconds. The question to my attorney is can I do an opt-out notice to change everyone's contract to 90 second previews in a manner similar to iTunes?"
Sounds like Steve is planning a fun weekend indoors. But what about the contracts that can't be modified quickly enough? Can labels be held liable for granting gratis mechanical licenses, as Apple has requested? “The risk here is that if you grant iTunes this royalty waiver it could put your label at risk for claims for mechanical royalties from publishers on tracks which you do not control the publishing rights," said A2IM head Rich Bengloff in an early note to Digital Music News.
But Bengloff, Corn, and others are asking questions and getting some clarification, and this isn't all happening tomorrow. Discussions with major publishers are still happening, and according to various indies, Apple is actively working through potential issues.
In the meantime, some sage advice for indies is to reach out to third-party publishers to update contracts and discuss details. Looks like this is going to take more than an extra minute to sort out.
