Yet Bacon calls that a minor gripe compared to the disparity of digital royalties: bands often only get 8% royalties on digital sales, as compared to an 18% royalty rate on physical records. ComSat Angels had a typical deal for their era: 16% royalties for vinyl, a 15% further deduction for cassettes and a 25% deduction for “packaging and new development costs”. “Pink Floyd got a 2% royalty rate on their original catalogue,” says Bacon. “Now, because digital is a new format, you don’t get the full royalty. That’s why you still don’t see some of the big older acts on iTunes.”
Quarmby says Awal was called in to Terra Firma (owners of EMI) to help them digitise tracks that had been gathering dust in the cellars of EMI in the UK and the Capitol Records building in LA. “Their vision was amazing. They wanted to make previously unheard tracks available to the public and for synchs (advertising, soundtracks etc),” says Bacon. “But what they hadn’t realised was that their relationships with their artists were terrible.” They brought in lawyers to sift through the contracts and, to their frustration, learned they’d need the artists’ permission to digitise the old tracks – and the artists refused.
Quarmby, an ex-artist and record producer himself, says he and Bacon initially saw Awal as a resource for themselves and their friends who had also felt cheated of fair royalty payments. They drew up simple one-page contracts (traditional record contracts are usually hundreds of pages long) that were short term and let the artists retain ownership of their music. “Now, this is fairly common,” says Quarmby. “But when we started four years ago, people said: ‘That’s not a good business model. If you don’t have any rights, how can you sell the company?’ Which, of course, wasn’t our aim.”