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@ MidemNet: Indie Labels Join Forces For Online 'Parity'; Create 'Virtual Fifth Major' Called Merlin

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image[By Robert Andrews] Some major independent record companies have come together to create a “virtual fifth major” label – a strategy designed to improve their capacity to fight online copyright abuses and negotiate digital distribution deals. Named Merlin, the London-based non-profit licensing organization aims to give the tens of thousands of independent labels and artists a stronger voice in cutting deals with download services and others. Founding labels include Rough Trade, The Beggars Group, Tommy Boy Entertainment, Ministry Of Sound, Epitaph, Domino, Cooking Vinyl, Edel and others

They hope giving such services a single channel for negotiations with all indie artists will help them achieve “parity” with those on the four major labels. The creation of the organization was hastened “because of the announcements made last year with Google, YouTube and MySpace”, said Alison Wenham, a founder member and president of Worldwide Independent Network: “We have begun discussing licensing with those companies.”

Indie music makes up almost a third of worldwide music sales but, individually, the labels say they have not enjoyed the lobbying power of their larger rivals. Indies have previously complained they were getting a smaller portion of revenue from iTunes Music Store sales than their counterparts, for example – an early stumbling block to the appearance of artists such as Franz Ferdinand and The White Stripes on Apple’s European service. Merlin hopes to announce its first deal during the MidemNet forum.

I asked the Merlin representatives at the launch press conference whether indie artists suffer online abuses to any greater extent than those with major labels. – Charles Caldas, CEO: “Because they don’t have an effective route through to the market, [they suffer greater online abuse than those on the majors],” he said. “What Merlin creates on behalf of the licensees is a single way to effectively license things.” – Michel Lambot, co-president of the PIAS European distribution network: “It is difficult for thousands of labels to reach thousands of services everywhere in the world.” – Alison Wenham: “You often receive less and it costs you more to get to market, so it’s a double-whammy, and then there’s the third problem of being ignored altogether.”

Contacting Merlin: We’ve heard from some readers who want to work with Merlin. Still in the early stages, the organization has not yet installed a full staff or even a site of its own. For now, Caldas is probably best contacted via the UK’s Association of Independent Music (AIM), a label umbrella that is a Merlin founder member.