WEBVTT - Bowie, McCartney & Michael Jackson: How Songwriters Learned to Play Hardball 0:00:17.560 --> 0:00:21.479 Pushkin too quick. No, it's perfect push kit stuff. You 0:00:21.600 --> 0:00:34.320 got it. 0:00:36.360 --> 0:00:39.960 Just because you own something, even with a patent or copyright, 0:00:40.200 --> 0:00:43.440 it doesn't mean that you can necessarily make money off 0:00:43.480 --> 0:00:46.400 of it profit off of it, because what you need 0:00:46.720 --> 0:00:50.440 is the power to protect your ownership, protect the thing 0:00:50.479 --> 0:00:52.400 you own from the people who want to take it. 0:00:53.360 --> 0:00:56.240 This is a lesson that the songwriters of the United 0:00:56.280 --> 0:00:59.160 States of America learned about one hundred years ago. In 0:00:59.200 --> 0:01:02.920 the early nineteen hundreds, you could get famous writing a 0:01:03.000 --> 0:01:05.840 hit song, you could own that song, and you would 0:01:05.880 --> 0:01:10.479 still be poor. Songwriters were mostly employees or contractors, handing 0:01:10.520 --> 0:01:13.280 over their work for just a few bus But that 0:01:13.400 --> 0:01:17.399 all changed when the meek and talented songwriters of this country, 0:01:17.600 --> 0:01:20.880 guys who tinkled pianos all day long, they banned it 0:01:20.920 --> 0:01:27.080 together and decided to play hardball. The songwriters adopted mafia 0:01:27.240 --> 0:01:32.559 like tactics, and they held music in America hostage until 0:01:32.560 --> 0:01:36.480 everyone agreed to pay them what they were owed and more. 0:01:37.080 --> 0:01:40.760 I'm Robert Smith and I'm Jacob Goldstein. This is Business History, 0:01:41.200 --> 0:01:42.840 a show about the history of business. 0:01:42.959 --> 0:01:46.160 The funny thing is that music is designed to be copied. 0:01:46.560 --> 0:01:48.600 The whole point is you want to play it again 0:01:48.640 --> 0:01:51.360 and again by different people. You know, you hear the song, 0:01:51.440 --> 0:01:54.200 you join in singing, you listen once you can hummet back. 0:01:55.120 --> 0:01:56.760 But the problem, of course, is if something can be 0:01:56.760 --> 0:01:59.360 easily copied, it's hard to make sure that the owner 0:01:59.400 --> 0:01:59.960 gets paid. 0:02:00.120 --> 0:02:02.800 This problem that the songwriters were trying to solve is 0:02:02.840 --> 0:02:05.680 a big it's a big idea problem. It's a problem 0:02:05.720 --> 0:02:10.120 for anyone who owns intellectual property, whether that's software or 0:02:10.200 --> 0:02:14.080 a podcast. You make a thing, you technically own it, 0:02:14.240 --> 0:02:15.560 but it's easy to copy. 0:02:15.680 --> 0:02:16.800 How do you get paid? 0:02:16.880 --> 0:02:21.239 How do you control, really control your intellectual property. 0:02:21.480 --> 0:02:24.519 There is copyright protection, and there was so in the 0:02:24.560 --> 0:02:28.960 early nineteen hundreds, but songwriters realized that that protection wasn't enough. 0:02:29.240 --> 0:02:33.160 They needed power. They needed to band together. They created 0:02:33.200 --> 0:02:37.320 an industry group so powerful that it persists to this day, 0:02:37.840 --> 0:02:42.639 and the system they built ended up making songwriting so valuable. 0:02:42.840 --> 0:02:48.519 It created billionaire musicians and brought Wall Street calling Duomo. 0:02:49.240 --> 0:02:54.519 The songwriter's revolution starts Jacob. In nineteen thirteen, a composer 0:02:54.639 --> 0:02:57.760 named Victor Herbert He's feeling the Peckish, walks into a 0:02:57.800 --> 0:03:03.040 restaurant in Times Square called Shanley's. Now Times Square. Shanley's 0:03:03.160 --> 0:03:05.720 was one of those places to see and be seen, 0:03:05.919 --> 0:03:10.440 very famous clientele, known for their lobsters. In nineteen thirteen, 0:03:11.000 --> 0:03:13.560 and there's a and playing in the corner. You know, 0:03:13.600 --> 0:03:16.720 it's just a racous, fun atmosphere. And Herbert at this 0:03:16.760 --> 0:03:19.400 time is a pretty big deal. He gets a good table. 0:03:19.639 --> 0:03:23.160 He's helped take American theater from sort of vaudeville shows 0:03:23.160 --> 0:03:27.360 to the story based musicals that we hear today. He 0:03:27.400 --> 0:03:30.680 wrote the musical Babes in Toyland in nineteen oh three. 0:03:30.919 --> 0:03:35.760 And so Herbert's eating lobster whatever, right, and then he 0:03:35.760 --> 0:03:39.240 hears it the band starts playing a song from a 0:03:39.280 --> 0:03:43.240 new Broadway show called Sweethearts. 0:03:44.320 --> 0:03:47.520 We've actually brought in our own piano player today, pushed 0:03:47.560 --> 0:03:48.760 his own Benfefer. 0:03:53.160 --> 0:03:55.680 Victor. Herbert is sitting at his table, and he knows 0:03:55.800 --> 0:03:59.440 this song because he wrote it. It's his and last 0:03:59.440 --> 0:04:02.320 time he checked, he was not getting a cut of 0:04:02.360 --> 0:04:10.600 any of that sweet Shanley's lobster money, thanks Ben. So 0:04:10.880 --> 0:04:13.680 after his meal, Herbert calls up Shanley, the owner, and 0:04:13.720 --> 0:04:17.440 he informs him that, you know, copyrights do exist even 0:04:17.480 --> 0:04:20.279 in nineteen thirteen, and I own the copyright on the song. 0:04:20.600 --> 0:04:23.239 So I need to be paid, Herbert says, for the 0:04:23.279 --> 0:04:28.599 performance of my music, and Shenley disagrees. I don't know, 0:04:28.600 --> 0:04:29.920 maybe he's in a bad mood. He could have just 0:04:29.960 --> 0:04:31.680 given a few bucks, but he says, you know what, 0:04:32.360 --> 0:04:36.040 we haven't charged admission to the restaurant. It's not a 0:04:36.120 --> 0:04:39.120 performance in a concert hall. It's just playing in the 0:04:39.160 --> 0:04:41.719 background while people eat. We can play whatever we want 0:04:41.760 --> 0:04:43.160 in the background. It's immaterial. 0:04:43.320 --> 0:04:45.640 But think about it from Herbert's point of view, this 0:04:45.680 --> 0:04:48.479 is this moment in the early twentieth century when the 0:04:48.520 --> 0:04:52.120 country is urbanizing. People are moving to cities and it's 0:04:52.160 --> 0:04:55.400 getting richer. People have more leisure time, they're going out more. 0:04:55.720 --> 0:04:58.200 So there are more and more of these places where 0:04:58.720 --> 0:05:01.960 people are paying to whatever eat dinner, and in the 0:05:02.000 --> 0:05:05.240 background somebody is playing copyrighted music. 0:05:05.640 --> 0:05:08.520 And it is expected at this point that you would 0:05:08.560 --> 0:05:10.760 have what are now known as hit songs that weren't 0:05:10.800 --> 0:05:13.080 really hit songs before this. This is before the radio 0:05:13.200 --> 0:05:16.200 and really when photographs are starting. So the hit songs 0:05:16.200 --> 0:05:18.400 were the songs you saw on Broadway or that you 0:05:18.440 --> 0:05:19.760 saw when you went to Shanley's. 0:05:20.000 --> 0:05:23.200 If you're Herbert like it seems good that there's a 0:05:23.279 --> 0:05:25.480 hit song and it's your hit song and everybody's playing it, 0:05:26.080 --> 0:05:29.720 but now you want to get paid, and it's never 0:05:29.800 --> 0:05:32.440 gonna be worth your time to try and figure out 0:05:32.760 --> 0:05:34.919 if a piano player is playing your song in some 0:05:35.080 --> 0:05:38.200 random restaurant or bar. Impossible to know, impossible to know. 0:05:38.360 --> 0:05:41.720 And there's this useful idea here, which is the collective 0:05:41.880 --> 0:05:45.440 action problem, right, Like, think of all the composers, all 0:05:45.520 --> 0:05:48.320 of the Herbert's writing songs. Like if there were some 0:05:48.440 --> 0:05:53.279 way they could all get together and act, they could 0:05:53.400 --> 0:05:56.039 maybe figure out a way to make it worth getting 0:05:56.080 --> 0:05:59.320 paid for each little performance. But how do you do that. 0:05:59.800 --> 0:06:01.760 I'll tell you how you do that. You start out 0:06:02.000 --> 0:06:08.279 with a lawsuit. So Victor Herbert sues Shanley and Shanley. 0:06:08.760 --> 0:06:11.279 He has his own collective action problem because he doesn't 0:06:11.320 --> 0:06:13.800 want to, like have to figure out whose songs he's 0:06:13.839 --> 0:06:15.760 playing and pay them all. So he goes to the 0:06:15.839 --> 0:06:19.440 National Association of Hotel and Restaurant Owners. They all get 0:06:19.480 --> 0:06:22.960 together to back his legal defense. They want a court 0:06:23.040 --> 0:06:25.960 to say that music in the background doesn't matter, you 0:06:26.040 --> 0:06:28.640 do not have to pay the composers. And Herbert's is fine. 0:06:28.720 --> 0:06:32.080 I've got friends too, and he assembles eight heavy hitters 0:06:32.120 --> 0:06:35.200 from the music publishing industry at a German restaurant downtown 0:06:35.200 --> 0:06:37.360 called Lucho's. They were not going to go to Shanley's 0:06:37.360 --> 0:06:40.680 for this, so the songwriters decide to form a cartel. 0:06:41.120 --> 0:06:45.600 They decide to found in nineteen fourteen the American Society 0:06:45.720 --> 0:06:51.200 of Composers, Authors and Publishers ASCAP. It is known as ASCAP, 0:06:51.240 --> 0:06:52.680 and I'm not going to say the whole thing, will 0:06:53.000 --> 0:06:55.680 just refer to it as as CAP going forward, and 0:06:55.720 --> 0:06:59.680 they start recruiting all of the songwriters in town. There is, 0:06:59.720 --> 0:07:02.960 in fact a district of New York City where the 0:07:03.000 --> 0:07:06.800 songwriters all work. It's called tinpan Alley, apparently because the 0:07:06.839 --> 0:07:09.760 sound of out of tune pianos sounds like tinpans being 0:07:09.800 --> 0:07:12.960 banged together, you know, evocative. It's old New York and 0:07:13.160 --> 0:07:17.840 Tinpanaley is where all the publishers of music exist, right. 0:07:17.920 --> 0:07:21.760 And the members of Tinpanaley are heavy hitters like Prepare Yourself, 0:07:22.120 --> 0:07:27.200 Irving Berlin truly, yeah, John Phillips SUSA, the Marches, Yeah, 0:07:27.240 --> 0:07:30.320 you need them all. And a budding songwriter named Gene 0:07:30.520 --> 0:07:32.840 Buck you don't know him back, He's going to come 0:07:32.880 --> 0:07:35.840 back into this story later. So the lawsuit goes on 0:07:36.640 --> 0:07:40.360 Herbert versus Shanley Company winds its way to the Supreme 0:07:40.360 --> 0:07:41.840 Court in nineteen seventeen. 0:07:42.080 --> 0:07:43.280 Love a Supreme Court case. 0:07:43.720 --> 0:07:46.960 You're going to love this one because Justice Oliver Wendell 0:07:47.120 --> 0:07:53.280 Holmes writes the decision Junior, and he rejects the argument 0:07:53.720 --> 0:07:56.640 that this music was just incidental to the restaurant that 0:07:56.640 --> 0:07:59.640 it's playing in the background. His decision said, if the 0:07:59.720 --> 0:08:02.720 music did not pay, it would be given up. If 0:08:02.760 --> 0:08:06.080 it pays, it pays out of the public pocketbook. Whether 0:08:06.120 --> 0:08:08.960 it pays or not, the purpose of employing it is 0:08:09.040 --> 0:08:12.440 profit and that is enough. So it basically means, just 0:08:12.440 --> 0:08:15.480 to be clear, like, you could play and sing it at. 0:08:15.280 --> 0:08:18.040 Your house if you have your friends over, Yeah, But 0:08:18.160 --> 0:08:20.240 if you charge your friends ten bucks to come in 0:08:20.640 --> 0:08:23.120 and you play the music, then you got to give 0:08:23.160 --> 0:08:23.840 ass CAAP a cut. 0:08:23.920 --> 0:08:24.080 Yeah. 0:08:24.120 --> 0:08:27.120 It means even if you're just harmlessly using music in 0:08:27.200 --> 0:08:31.560 a podcast and the podcast has advertising and you're making 0:08:31.600 --> 0:08:33.439 money off of it, then you have to pay the 0:08:33.480 --> 0:08:34.480 people who wrote the music. 0:08:34.960 --> 0:08:35.840 Excellent example. 0:08:35.960 --> 0:08:40.959 The ruling established the power of as cap and they 0:08:41.000 --> 0:08:43.520 had a sort of two part plan. The first part 0:08:43.839 --> 0:08:50.120 was they are going to start enforcing the rules about copyright. 0:08:50.400 --> 0:08:54.679 So essentially, as CAP sends out music cops people who 0:08:54.720 --> 0:08:59.000 go to the big establishments like Shandley's and listen and 0:08:59.040 --> 0:09:02.160 write down all the music that's played, and then they 0:09:02.240 --> 0:09:06.880 sue the restaurant owner or the burlesque hall. And of 0:09:06.920 --> 0:09:10.320 course they weren't getting everyone, but it's a huge, huge 0:09:10.360 --> 0:09:12.760 scary thing to be slapped with a loss, and everyone 0:09:12.760 --> 0:09:16.280 knows they're going to lose the lawsuit, so now they 0:09:16.320 --> 0:09:21.280 have the restaurant's attention. And this is when ASCAP offers 0:09:21.320 --> 0:09:23.840 an easy way out, like, yeah, you could try to 0:09:23.880 --> 0:09:27.880 avoid us and we'll just sue you all eventually, or 0:09:28.559 --> 0:09:31.200 you could pay us a tiny percentage of the money 0:09:31.240 --> 0:09:33.640 you make in your restaurant and then you can play 0:09:33.640 --> 0:09:37.880 anything you want from our collective of musicians. Hu as 0:09:37.960 --> 0:09:41.320 CAP and TERN distributed the royalties they got from these 0:09:41.400 --> 0:09:44.880 establishments to its members, they had a very complicated system, 0:09:45.200 --> 0:09:49.200 but basically, if you were a big popular songwriter and 0:09:49.200 --> 0:09:51.800 people knew your name, you would get more money from 0:09:51.800 --> 0:09:54.520 the royalties. If you had more hits, if you produced 0:09:54.559 --> 0:09:57.280 more songs, you'd get more money. And the money was 0:09:57.320 --> 0:10:00.720 technically shared between the songwriters and the publishing houses who 0:10:00.720 --> 0:10:01.920 were marketing the music. 0:10:02.559 --> 0:10:05.440 I mean, I will say, this seems like a nice system, 0:10:05.559 --> 0:10:09.400 right because on the one hand, you want everybody to 0:10:09.400 --> 0:10:11.439 get paid who should get paid, But on the other 0:10:12.320 --> 0:10:15.640 there would be all this friction otherwise, like counting every 0:10:15.800 --> 0:10:18.760 song you play if you're a restaurant is such a 0:10:18.880 --> 0:10:20.800 ridiculous thing to have to do. Like you're not in 0:10:20.840 --> 0:10:23.319 the counting songs business. You're in the restaurant business. And 0:10:23.440 --> 0:10:24.600 this does seem to solve that. 0:10:24.840 --> 0:10:27.600 It does, and you know, it works out to whatever 0:10:27.679 --> 0:10:30.720 pennies per song. But it's great for the musicians, and 0:10:30.800 --> 0:10:33.240 it probably ends up being great for the restaurants and 0:10:33.280 --> 0:10:36.160 such that they don't have to think about this whole thing. Now. 0:10:36.200 --> 0:10:39.920 It is worth mentioning that as CAP did not let 0:10:40.000 --> 0:10:42.840 just anyone in. They had rules. You had to know 0:10:42.840 --> 0:10:45.679 how to read music, you had to have the right pedigree, 0:10:46.120 --> 0:10:49.360 meaning that for the most part, jazz and blues musicians, 0:10:49.480 --> 0:10:51.800 hillbilly musicians as they were called at the time. We 0:10:51.960 --> 0:10:54.199 now know that as country music they were left out 0:10:54.200 --> 0:10:56.080 of this whole thing. It was you know, the Broadway, 0:10:56.120 --> 0:10:57.200 the composers, it. 0:10:57.120 --> 0:11:00.239 Was New York thinking it was better than everybody else exactly. 0:11:00.720 --> 0:11:04.480 By nineteen twenty one, this whole thing is actually paying 0:11:04.520 --> 0:11:08.080 off for as Cap. Whatever they were spending in enforcing 0:11:08.200 --> 0:11:12.560 their copyrights, they're getting more money back. Everything's working out 0:11:12.920 --> 0:11:18.080 for its members until a brand new technology emerges. 0:11:18.559 --> 0:11:20.600 Your favorite technology. 0:11:20.120 --> 0:11:25.000 A miracle in the ether. It's radio. November two, nineteen 0:11:25.280 --> 0:11:28.640 twenty first radio broadcast out of Pittsburgh. 0:11:29.040 --> 0:11:34.080 This is kd KA of the Westinghouse Electric and Manufacturing 0:11:34.120 --> 0:11:36.800 Company in East Pittsburgh, Pennsylvania. 0:11:36.880 --> 0:11:40.080 The Westinghouse Corporation like Westinghouse in our Edison, Tesla and 0:11:40.120 --> 0:11:40.920 Westinghouse show. 0:11:41.120 --> 0:11:44.559 Yeah, they wanted to sell radios electronics, so they had 0:11:44.559 --> 0:11:47.280 to put something on the air. But Jacob, I wanted 0:11:47.280 --> 0:11:51.199 you to hear this part very first broadcast ever. Listen 0:11:51.240 --> 0:11:52.240 to what the announcer says. 0:11:52.679 --> 0:11:56.160 We'd appreciate it if anyone hearing this broadcast would communicate 0:11:56.240 --> 0:11:58.720 with us, as we are very anxious to know how 0:11:58.760 --> 0:12:02.240 far the broadcast is reaching and how it is being received. 0:12:02.320 --> 0:12:04.960 Email us at business History at Pushkin dot of him. 0:12:05.240 --> 0:12:07.960 I love the very first hour of the very first broadcast. 0:12:07.960 --> 0:12:11.120 They're like, do we have any listeners? Write us or 0:12:11.480 --> 0:12:15.200 leave a coment below. Guys, that was a news broadcast. 0:12:15.200 --> 0:12:17.640 That's how it started out. But very quickly radio stations 0:12:17.679 --> 0:12:21.959 started to play sporting events, radio dramas, and music. And importantly, 0:12:22.040 --> 0:12:25.520 at this time, music on the radio was played live. 0:12:25.559 --> 0:12:28.920 They would bring in orchestras to play the music, just 0:12:28.960 --> 0:12:33.160 like in the restaurants and for as cap they're like, okay, like, 0:12:33.679 --> 0:12:37.559 what is radio except a dance hall of the air. 0:12:37.920 --> 0:12:40.840 Of course you have to pay the piper, or pay 0:12:40.840 --> 0:12:42.720 the person who wrote the music for the piper. But 0:12:42.760 --> 0:12:44.680 you know how it goes. There's a series of court 0:12:44.720 --> 0:12:48.079 cases and radio stations they make all these arguments. These 0:12:48.080 --> 0:12:51.560 are gonna sound familiar. The first one is the radio says, 0:12:52.040 --> 0:12:54.920 since there is no audience in the studio, we are 0:12:54.960 --> 0:12:57.000 not giving a public performance. 0:12:58.480 --> 0:12:59.760 It's just it's just private. 0:12:59.960 --> 0:13:02.240 It's just private, just in the studio. If you're listening in, 0:13:02.320 --> 0:13:04.160 that's not our concern. 0:13:04.160 --> 0:13:05.360 It's literally their concern. 0:13:05.480 --> 0:13:09.320 Go on. The second argument they made, and you'll hear 0:13:09.360 --> 0:13:13.120 this one today, we make the songwriters f so why 0:13:13.120 --> 0:13:14.080 should we pay them? 0:13:14.240 --> 0:13:17.200 They should pay us. That was in fact the payola 0:13:17.240 --> 0:13:19.480 scandal of a few decades later, which was illegal. 0:13:19.559 --> 0:13:23.880 But the third one was radio does not broadcast music. 0:13:24.000 --> 0:13:27.560 Jacob it emanates electrical energy. 0:13:28.480 --> 0:13:30.920 Hamburger's not chopped ham, it's chopped steak. 0:13:33.120 --> 0:13:37.720 Obviously, these were stupid arguments. In nineteen twenty four, the 0:13:37.800 --> 0:13:41.800 FCC Federal Communications Commission rules that radio is, of course 0:13:41.800 --> 0:13:45.959 a public performance and copyright is in effect you have 0:13:46.000 --> 0:13:49.720 to pay the musicians. As CAP has won, not only 0:13:49.720 --> 0:13:52.920 are they getting a small amount of money from restaurants 0:13:52.960 --> 0:13:55.200 and dance halls and that sort of thing, they now 0:13:55.480 --> 0:13:58.960 get a share of the money from the biggest technology 0:13:59.000 --> 0:14:00.760 of the time, the thing that is going to take 0:14:00.800 --> 0:14:05.560 over music in America radio. So far in this podcast, 0:14:05.800 --> 0:14:08.080 I have been sort of pulling for the little guy, 0:14:08.559 --> 0:14:13.080 the songwriters, but they are about to go way too 0:14:13.640 --> 0:14:15.600 far in their quest to control music. 0:14:15.720 --> 0:14:18.600 That's what cartels do. This is a cartel story. They 0:14:18.600 --> 0:14:21.000 get together, there's a collective action problem there the little guys, 0:14:21.520 --> 0:14:25.360 but then they go crazy with their cartel power. 0:14:25.280 --> 0:14:29.560 They become the big guys. It starts with the election 0:14:29.680 --> 0:14:31.960 of a new president of the organization. His name is 0:14:32.080 --> 0:14:34.600 Jean Buck. I mentioned him before. He's one of the composers. 0:14:34.920 --> 0:14:38.960 He is the composer of get Ready. Ben Daddy has 0:14:39.000 --> 0:14:58.200 a sweetheart and mother is her name. Don't let that 0:14:58.280 --> 0:15:02.680 sweet tune fool you. Jean Buck is a total shark. 0:15:04.280 --> 0:15:07.119 Gene Buck is about to run as Cap like the Godfather. 0:15:07.400 --> 0:15:09.280 What is some radio guy gonna wake up with a 0:15:09.440 --> 0:15:11.080 bloody microphone in his bed? 0:15:11.200 --> 0:15:15.040 Ah when our program continues. 0:15:36.920 --> 0:15:40.960 Okay, we're back. We got Jean Buck. Gene but is 0:15:41.000 --> 0:15:45.320 apparently not a sweetheart running as Cap. What happens next? 0:15:45.520 --> 0:15:48.880 He's about to do the thing that cartels always do, 0:15:49.240 --> 0:15:52.640 which is to squeeze their customers just a bit too 0:15:52.680 --> 0:15:56.800 hard until they squeal. Bucks started out actually as a 0:15:56.840 --> 0:15:59.760 cover illustrator in Tin pan Alley. You know, the way 0:15:59.800 --> 0:16:02.520 you sold sheet music was you had to have a 0:16:02.560 --> 0:16:05.560 picture on the cover like, oh this looks great. I'm 0:16:05.560 --> 0:16:07.000 gonna buy this for my kid to learn how to 0:16:07.000 --> 0:16:09.800 play the piano. And then his eyesight started to fail 0:16:09.880 --> 0:16:13.880 him and he became someone who wrote lyrics. Okay, that's fine, 0:16:13.960 --> 0:16:16.240 and he became very successful at it. He was known 0:16:16.240 --> 0:16:19.560 as mister Broadway, so successful that he had a mansion 0:16:19.800 --> 0:16:23.040 out on Long Island next to f Scott. 0:16:22.640 --> 0:16:25.120 Fitzgerald Gatsby Gatsbys. 0:16:25.240 --> 0:16:28.120 It is a rumored that his parties might have inspired 0:16:28.160 --> 0:16:30.480 the great Gatsby, although now that they think of it, 0:16:30.600 --> 0:16:34.000 Everyone on Long Island probably says that about themselves, right, So. 0:16:34.040 --> 0:16:36.240 I mean if they were rich and full of despair 0:16:36.280 --> 0:16:37.560 and had great parties. Sure. 0:16:38.480 --> 0:16:42.080 So he has an orchard out there. Vineyard apparently doesn't drink. 0:16:42.440 --> 0:16:46.240 Time Magazine calls him the general Lissimo of the clangorous 0:16:46.360 --> 0:16:47.920 army of tinpan alleymen. 0:16:48.040 --> 0:16:50.720 That is the timiest sentence that ever timed. 0:16:51.160 --> 0:16:53.840 Why do you give us the new Yorkist sentence ever 0:16:53.920 --> 0:16:57.400 new Yorker? So the New Yorker said of him, they said, 0:16:57.840 --> 0:17:01.880 the sentimental, soft spoken lyric writer is the most powerful 0:17:01.920 --> 0:17:06.119 private citizen on earth. He can stop the broadcasting of 0:17:06.159 --> 0:17:10.560 popular music if he says stop jazz must vanish from 0:17:10.560 --> 0:17:13.840 the air. It's interesting they would mentioned jazz because gen 0:17:13.960 --> 0:17:16.680 Buck did not seem like a big fan of black 0:17:16.760 --> 0:17:20.639 music or black performers. He didn't let black musicians mostly 0:17:20.720 --> 0:17:22.960 or not many of them into as CAP. He's a 0:17:23.080 --> 0:17:27.400 driving force behind ASCAP's exclusion of blues and R and B, 0:17:27.720 --> 0:17:30.639 as well as hillbilly musicians. So at this point it 0:17:30.880 --> 0:17:35.320 is all about the radio, whatever else. As CAP was 0:17:35.320 --> 0:17:40.159 doing sheet music sales, photographs, player pianos, like the radio 0:17:40.320 --> 0:17:42.920 is making the most money, and so Gene Buck says, 0:17:43.040 --> 0:17:46.320 we go where the money is. We are going to 0:17:46.440 --> 0:17:49.680 squeeze them. In nineteen thirty five, they make a deal 0:17:49.720 --> 0:17:52.640 with radio stations. Radio has to pay a fixed fee 0:17:52.640 --> 0:17:57.640 to as CAP of five percent of their advertising revenue 0:17:58.160 --> 0:17:59.400 five percent a year. 0:17:59.520 --> 0:18:01.119 It's a good time to be writing songs. 0:18:01.160 --> 0:18:03.560 I guess it creat time to be writing songs. It 0:18:03.600 --> 0:18:06.600 works out to millions of dollars for as CAP. And 0:18:07.080 --> 0:18:09.840 at this point in nineteen thirty nine, as CAP does 0:18:09.960 --> 0:18:15.040 control about ninety percent of music copyrights. They're in bed 0:18:15.080 --> 0:18:17.800 with Hollywood. Their members are writing songs for Broadway, they 0:18:17.800 --> 0:18:24.040 are running popular culture. Now, radio stations obviously are a 0:18:24.080 --> 0:18:26.719 little upset with this situation, you know, having to give 0:18:26.760 --> 0:18:29.399 away five percent of their advertising revenues. They go to 0:18:29.440 --> 0:18:32.160 the federal government. The federal government, it's a complicated story, 0:18:32.200 --> 0:18:34.399 but they decide that for the time being, they are 0:18:34.400 --> 0:18:38.080 not going to challenge this cartel. So instead the radio 0:18:38.119 --> 0:18:43.159 stations go to the state legislatures, state by state. In 0:18:43.200 --> 0:18:46.240 the mid to late nineteen thirties, they go and try 0:18:46.280 --> 0:18:50.560 to convince them to pass laws against this mafia like behavior, 0:18:50.600 --> 0:18:54.600 and they succeed in a few states, Nebraska, Louisiana, Tennessee, 0:18:55.200 --> 0:18:59.439 and importantly for the story, Montana. They all pass laws 0:18:59.760 --> 0:19:04.240 that forbid the collection of performance fees by joint action. 0:19:04.600 --> 0:19:07.919 Collection of So it's like it's like a racket, Like 0:19:07.960 --> 0:19:10.480 I'd hate to see what would happen to your radio 0:19:10.520 --> 0:19:11.840 station if you did not pay me. 0:19:13.040 --> 0:19:17.640 They say it is extortion because it's not a free 0:19:17.720 --> 0:19:21.120 market negotiation with the rights are Montana should be able. 0:19:21.200 --> 0:19:23.639 Montana Radio Station should be able to make their own deals, 0:19:23.680 --> 0:19:25.320 which they cannot under this system. 0:19:25.359 --> 0:19:27.280 They're trying to undo the cartel, trying to sort of 0:19:27.359 --> 0:19:29.800 unsolve the collective action problem. 0:19:29.560 --> 0:19:34.560 And it's gonna get hot this fight. Montana Radio Station 0:19:34.960 --> 0:19:38.400 gets a Justice of the Peace to issue a warrant 0:19:38.440 --> 0:19:42.960 for jen Buck, the president of ASCAP, on extortion charges. 0:19:43.200 --> 0:19:46.080 This man cannot go to Montana because there is a 0:19:46.119 --> 0:19:49.439 warrant out for his arrest, and in fact, that warrant 0:19:49.480 --> 0:19:54.840 starts to be circulated to other states. Jeenbuck is visiting Phoenix, Arizona, 0:19:54.920 --> 0:20:00.320 nowhere near Montana, and he gets arrested on extortion. The 0:20:00.320 --> 0:20:03.080 sheriff sets the bail at ten thousand dollars. 0:20:03.200 --> 0:20:05.239 Not Treville, no A. 0:20:05.320 --> 0:20:08.760 Buck is in Phoenix, it's a it's a holiday weekend, 0:20:08.840 --> 0:20:10.280 doesn't know where he's gonna get the money. He calls 0:20:10.320 --> 0:20:14.000 up a friend and the friend is okay, I will 0:20:14.040 --> 0:20:18.400 send a certified check from Chase National Bank to the sheriff, 0:20:18.920 --> 0:20:22.960 and the sheriff apparently replied, I'm one of those old 0:20:23.119 --> 0:20:26.840 fashioned fellas, and I don't know what a certified check is. 0:20:27.280 --> 0:20:30.639 And I have never heard of this Chase National Bank. 0:20:30.800 --> 0:20:33.640 I don't believe that sheriff will admit. I bet he's 0:20:33.720 --> 0:20:36.520 running for offense. I bet he's got three hundred thousand 0:20:36.600 --> 0:20:39.040 dollars in an account in the Chase National Bank. 0:20:38.840 --> 0:20:42.960 And arresting in New York. Songwriter is good forgetting votes, 0:20:43.000 --> 0:20:47.120 good forgetting votes. Eventually Buck gets out, the charges are dropped. 0:20:47.880 --> 0:20:52.159 Montana's like, this is ridiculous, but this shows you how 0:20:52.359 --> 0:20:56.480 serious this fight was getting. So the government's sniffing around. 0:20:56.520 --> 0:21:00.119 Broadcasters are pushing back. These should be a sort of 0:21:00.240 --> 0:21:03.880 warning to ASCAP to be like, hey, be a little 0:21:03.920 --> 0:21:06.159 bit of a benevolent monopoly here, you know, give you 0:21:06.480 --> 0:21:08.960 give your customers a break. Yeah, take the money, just 0:21:09.000 --> 0:21:12.760 get rich enough, don't push it too far. Gene Buck 0:21:13.040 --> 0:21:15.560 announces that they're going to raise rates. They are going 0:21:15.560 --> 0:21:17.880 to double them, in fact, from five percent to ten 0:21:17.960 --> 0:21:22.479 percent of the broadcasters advertising revenue. And this is going 0:21:22.560 --> 0:21:24.919 to go into effect when the contract expires at the 0:21:25.080 --> 0:21:29.720 end of nineteen forty December thirty first, nineteen forty. If 0:21:29.760 --> 0:21:32.719 you don't pay us, you will have no music on 0:21:32.760 --> 0:21:36.919 your air in nineteen forty one. So what happens The 0:21:36.960 --> 0:21:42.000 broadcasters freak. They're just like, Oh, we got to negotiate, 0:21:42.000 --> 0:21:44.399 We got to negotiate. They set up this big meeting 0:21:44.440 --> 0:21:47.000 between the heads of all the big radio networks and 0:21:47.119 --> 0:21:49.480 Gene Buck. They have a room at the Ritz Tower. 0:21:49.520 --> 0:21:54.000 They're gonna hash this out. The radio executives arrive. Buck 0:21:54.119 --> 0:21:57.520 is late and it's an hour two hours. He doesn't show. 0:21:57.560 --> 0:22:00.280 They call askap there, They're like, where's Gene Buck, Like 0:22:00.280 --> 0:22:03.040 we're supposed to negotiate. They're like, oh, Gene Bucks on 0:22:03.080 --> 0:22:05.840 the West coast. In fact, he's on a train en 0:22:05.960 --> 0:22:08.040 route to the Bohemian Grove. 0:22:08.920 --> 0:22:12.000 I know that the Bohemian Grove is like where famous 0:22:12.280 --> 0:22:16.600 rich people go camping with each other or something, right whatever, 0:22:16.760 --> 0:22:20.240 Henry Kissinger and Bill Clinton. It's where powerful and rich 0:22:20.280 --> 0:22:22.240 people go to meet in secret. 0:22:22.320 --> 0:22:23.520 And if you think of the. 0:22:23.600 --> 0:22:27.399 Arc so far. You know, we started with a composer 0:22:27.720 --> 0:22:31.680 walking into a restaurant having no power over the fact 0:22:31.680 --> 0:22:33.880 that his music was being played and he wasn't being paid. 0:22:33.920 --> 0:22:37.160 And now you have this guy going to hobnob with 0:22:37.200 --> 0:22:40.120 the most powerful elites instead of meeting with the people 0:22:40.160 --> 0:22:42.760 who want to negotiate with him, presumably in good faith. 0:22:43.040 --> 0:22:46.320 The broadcasters call a war meeting, yes, love a war meeting, 0:22:46.480 --> 0:22:50.240 and they say, how do you fight a cartel? And 0:22:50.320 --> 0:22:57.320 the answer is we form a rival cartel. They decide 0:22:57.480 --> 0:23:02.359 they are going to build Broadcast Music Incorporated b m I. 0:23:02.920 --> 0:23:06.959 There's a standing ovation and the idea behind BMI is 0:23:07.040 --> 0:23:11.320 there's a lot of music that ASCAP has not captured, country, blues, 0:23:11.480 --> 0:23:15.040 R and B, gospel, Latin artists, and so what if 0:23:15.040 --> 0:23:19.800 we sign those artists and we go to radio stations 0:23:20.200 --> 0:23:22.960 and say you don't have to deal with ASCAP, you 0:23:23.000 --> 0:23:26.920 can deal with us BMI. It's amazing when you say that, right, 0:23:26.960 --> 0:23:29.320 this is what nineteen thirty nine. So they don't know 0:23:29.359 --> 0:23:32.600