What is Risk Factor?
A musician asked us why we don't produce music videos. The response was simple: "it's too much of a risk." After qualifying that statement by explaining the various logistical intricacies and recounting the horror stories of recent photo shoots and financial damages, the musician responded:
"But you trust us to turn up to gigs, don't you?"
To which the response was:
"Yes, because it's not my money on the table."
The bride booked a band of musicians to perform at her wedding and as far as she's concerned, she's getting a 6-piece lineup consisting of female lead vocals, male backing vocals doubling saxophone and flute, piano, bass, kit and congas. That's what was stipulated in the contract. That's what we've delivered. The bride doesn't know the musicians personally and she's not concerned about who is in the lineup. So, the "risk factor" decreases. What if it's a question of producing excellent promotional video material for an agent/promoter who wants to see the exact lineup as advertised in the publicity? What if it's a financial investment that's significantly closer to the creative vision of the investor? The "risk factor" increases. It's the dynamic between that closeness, that "trueness to form" aspect, vs. the value of the investment, which determines the "risk factor".
The term "risk factor" essentially equates to the amount of financial risk shouldered by a hirer/engager (whether it be an agent, promoter, manager, label or any other role that involves the hire/engagement of human personnel): in terms of how an arrangement/agreement is challenged by outside circumstances. It's a term we've adopted from promoters who book artists to perform at venues, a term used to gauge and quantify to which the artist makes back the venue hire/HR costs on attendance and ticket sales. In this context, it means musicians and technicians attending an event at an agreed time/place and delivering a service that they agreed to deliver. In this particular case, it means producing high-quality, sustainable promotional video material that justifies the venue hire/HR costs invested by the label.
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When does "Risk Factor" become an issue?
Recently, we've had several agents ask for videos, but then the same agents insisting that the lineup they book is the same lineup as advertised in the publicity. In principle, while this is a lovely thought (one we wholeheartedly understand, advocate and endorse): the reality is that musicians, technicians and venues often breach their promises and/or commitments, and we cannot deny this as a statistical probability. Cancellations are likely to occur due to a number of factors:
A few examples...
£100.00 Musicians (£50.00 each)
= £705.00 TOTAL
= £353.00 TOTAL
= £353.00 TOTAL
£200.00 Musicians (£20.00 to cover time, £100.00 for the pianist as agreed)
= £650.00 TOTAL
= £450.00 TOTAL
Studio hire cost is £200 for half day up to 4 hours usage
Photographer cost is £250
£20.00 to cover time
Attendance Fee (Pianist)
The issue occurs when the circumstances of one subject (the defaulting party) hinders the production of the object (the videos/photos/audio) resulting in a cancellation which triggers knock on repercussions and undue headaches for all parties involved. Additionally, if the label has to (in the agents' interest of ensuring that the lineup booked is the lineup advertised in the publicity materials) withdraw from its venue hire and/or photographer/videographer agreement as a result of this internal musician breach: the label is left liable to shoulder the financial losses of the cancellation through no fault of their own. This is why we include the following in our recording contracts:
Please note that this is a professionally contracted engagement for which you are being paid to attend, and we are be hiring a venue/photographer for which we are required to pay in advance.
Additionally, we insist upon all agreements being made in a written form (via email). This is to ensure that all agreements and arrangements can be traced back and that all roles and responsibilities are clear and known to all parties. Emails are the preferred method of communication with Red & Black Music for ease of traceability, archiving and auditing. We've seen it occur in the past that verbal agreements would be misinterpreted in part or entirely, and it is more difficult to ensure that they are adequately accounted for in our books for the purposes of evaluation and future development.
We've tried and tested 100's of methods to prevent these cancellations from occurring over the years. We've been working on additional clauses to ensure internal agreements are met, running them past consultants and solicitors (and we're still working on them!).
Third Party Risk
Despite these measures, we continue to see breaches of promises/commitments. Nowadays, these are fully evidenced in writing. Reasons aside, the only thing we can do at the moment is to publish these breaches; not only to defame the existing offenders and act as a deterrent to potential offenders, but also to communicate these problems to clients and stakeholders. For example, agents such as Jason (Book Live Music & Entertainment) and Tim (Essence Music Agency) demand that the lineup booked is exactly the lineup advertised in the publicity materials, whilst failing to acknowledge such risks:
From: "Jason @ Book Live Music & Entertainment"
From: Essence Music Agency
The Musicians' Union
The Musicians' Union, whilst providing L2 contracts for musicians acting as hirers and echoing our insistence to obtain all agreements in a written form, does not support producers, managers or labels when musicians breach. This is understandably due to the fact that they cannot support both sides of any legal argument (the musician vs. the hirer), which would result in a sliding scale of charges.
I have run your queries past our in-house solicitor and he has advised as follows:-
The Musicians' Union declines support for the "bandleader" yet asserts that the bride is entitled to cancel for breach on the grounds that the band didn't bring the lineup as advertised. Catch 22! Again, the financial risk is shouldered on the label through no fault of their own. Furthermore there are no clauses in the standard L2 agreements that protect the label against breaches. Particularly in clause 5, in cases we've seen where musicians refuse to honour their contractual obligations despite not having had written consent:
What are the implications?
When we're paying musicians, technicians and venues for the recording (video/photo/audio) sessions, the more money put on the table = the more financial risk = the less legal protection. We've had extensive conversations with trade unions and insurers in both music and drama performing arts fields (The Musicians' Union, Hencilla Canworth, Bectu, Equity), but have thus far been able to establish any form of either legal protection or producers insurance.
The implications are as follows. We're currently unable to produce videos for the reasons discussed. We cannot afford to put ourselves in a position of such financial risk purely for the purposes of ensuring that the lineup booked is the lineup advertised in the publicity. We've learned this from solid, concrete experience having sustained financial losses due to breaches over the years. Simply: that the level of accountability among suppliers isn't sufficient to warrant such a high level of investment. There are too many risks and logistical probabilities at stake. While we wish the opposite were true, the reality is that individuals are a liability unto themselves: there is inevitably going to be a conflict of interest and a difference in agreement somewhere down the line. It's not possible to please everyone. So, instead, we try to ensure that the static publicity mediums (audio, photos) are at least the best quality they can be: even if we aren't able to extend to the more fluid, dynamic medium of video.
Should/Could this reflect badly on us? This is purely up to the reader's interpretation. Put yourselves in our shoes. What would you do? How would you ensure that this "risk factor" is reduced without resorting to the feeble arguments of "mutual trust" and/or "common sense"? Do you believe that the "risk factor" must be accepted as an intrinsic part of producing multimedia for the time-sensitive mediums of music and drama? If so, how would you manage "risk factor"? And ultimately, to what extent and who must remain liable - the musicians, the label or the agent?
If you believe that this reflects negatively on us (The Label): then that's completely your choice, too. After all, we cannot force you to think or react in a certain way. All we can do is be as honest, open and transparent about these issues, in the hope of articulating and communicating an understanding of the problems faced, and possibly find an antidote.
Picking up the pieces
What happens if things do go smoothly to plan? What if the musicians show up, the technicians arrive to open up the venue, the shoot goes ahead, the memory stick isn't lost, stolen or damaged, and the recorded multimedia is used on the website? This is fantastic, until the lead vocalist, after some soul searching, has a change of heart and decides that it isn't what they want to do after all (again, Read More: Empower the Individual). We are stuck with the video featuring the original lead vocalist. Thus "risk factor", this dependence on human personnel, continues to increase even after the media has been recorded.
At this point, we have 2 choices:
Diáspora 20100426 01
Diáspora 20100426 02
Diáspora's first (and one of the last!) attempts at producing a promotional music video. Unluckily, it happened to be that lead vocalist's last ever performance in that particular lineup. But it was precisely that lead vocalist who put pressure on the "bandleader" to do the photo/video shoots in the first place! Here is what our friend Tim (Essence Music Agency) had to say on the topic.
From: "Essence Music"
We have a few practical tricks up our sleeves:
The above measures significantly reduce the "risk factor" of our creative work. Unfortunately, we haven't been able to find equivalent practical ways of reducing the "risk factor" in video production, since the video format by definition is the most true and honest format. Therefore, we've opted for the safe choice of not producing videos at all (rather than making needless investment in producing sub-standard, time contingent content), or at least until we can obtain the necessary legal/insurance measures.
We cannot rely on "trust" to form the foundations of a fully-functioning business enterprise. This is because "trust" is a purely abstract, intangible and contingent concept, i.e., the more trust cultivated = the higher the disappointment threshold when that "trust" is broken (and we mean "when" as a certainty, not "if/when" as a possibility!). Relying on "trust" alone doesn't provide sufficient legal/financial protection required in order to make these sort of investments in people. By definition: HUMANS = RISK i.e., counting on people inevitably brings about risk. So avoid at all costs. And, if you can't avoid it: always have a contingency plan in place.
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