Karaoke Forums

https://pep.rocks/prime.php

Thoughts?

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DJ Don

Hmmmm... it's only for "licensed" or "authorized" KJ's that have some sort of contract with: either an audit contract, gem "license", "authorized/verified disc user," ect...

As soon as they are making money off jobs that's called a franchise, this is not a "entertainment agency relationship"

Is that a problem? Are they not allowed to add services?

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DJ Don

That's a lot of money and another contract too! I bet you can get the same deals from Amazon or Ebay with no strings attached.

Phoenix PRIME is not a franchise arrangement.

Beware taking legal advice from someone who "reads a lot."

Baloney. If it's not (and I believe it is), then it must be and entertainment booking agency which will require (yet another) contract for jobs you book and a percentage of the KJ's money. Will you be collecting all the money and dispensing checks to the KJ's too or just collecting your "agency commission" directly from the client or expect the KJ to mail it to you? Will you threaten venues with vicarious trademark lawsuits if they don't use your "booking service?"

Let's see those new contracts for both the KJ and the client if it's such an innocent entertainment agency business arrangement... why I might even want to sign up if it's what you say it is.

But let's continue on with this since PEP already requires:
#1. Licenses (politely named as "permission") to use the logo in a digital format.
#2. Payment for an audit, gem license, help license, etc.
#3. Both 1 and 2 above require a signed "contract"
#4. Even Harrington has admitted that they want the control over your "quality and service"
#5. Booking jobs will be referred only to those who have complied with 1 thru 3

But still, he insists that because you didn't sign a form with the word "franchise" on it, he will deny that it's a franchise agreement.

------------F-R-A-N-C-H-I-S-E-------------
A franchise business is a business in which the owners, or "franchisors", sell the rights to their business logo, name, and model to third party retail outlets, owned by independent, third party operators, called "franchisees". Franchises are an extremely common way of doing business. In fact, it's difficult to drive more than a few blocks in most cities without seeing a franchise business. Examples of well-known franchise business models include McDonalds, Subway, UPS, and H & R Block. In the United States, there are franchise business opportunities available across a wide variety of industries.

Investing in a Franchise Business

To invest in a franchise, the franchisee must first pay an initial fee for the rights to the business, training, and the equipment required by that particular franchise. Once the business begins operating, the franchisee will generally pay the franchisor an ongoing royalty payment, either on a monthly, quarterly, or annual basis. This payment is usually calculated as a percentage of the franchise operation’s gross sales.

After the contract has been signed, the franchisee will open a replica of the franchise business, under the direction of the franchisor. The franchisee will not have as much control over the business as he or she would have over their own business model, but may benefit from investing in an already-established, name brand.

Control of the Franchise

Generally, the franchisor will require that the business model stay the same. For example, the franchisor will require the franchisee to use the uniforms, business methods, and signs or logos particular to the business itself. The franchisee should remember that he or she is not just buying the right to sell the franchisor's product, but is buying the right to use the successful and tested business process.

The franchisee will also usually have to use the same or similar pricing in order to keep the advertising streamlined. For example, if you saw an advertisement for $75 tax preparation from a well-known tax preparation franchise, you would expect to find this deal at the franchise operation closest to you. Aside from using the business model determined by the franchisor, the franchisee will otherwise remain an independent owner of the franchise.

their prime offer does me no good in my area.

to me it's just another way to leach some money from my pocket.

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It's all good!

Phoenix PRIME is not an "entertainment booking agency." We're not going to be representing KJs in booking shows. We'll be booking shows directly.

We--meaning Phoenix--are in the process of expanding our karaoke entertainment services offerings to include what we refer to as "direct services." "Direct services" refers to our arranging contracts with venues to provide karaoke and other bar entertainment services to those venues, not unlike what you do, just on a much larger scale. Those services will be provided by us through employees and contractors. And yes, of course, we will pay the people who provide services for us.

One aspect of Phoenix PRIME is that it will provide us with a pool of qualified contractors to provide services under our contracts with venues. That is by far not the only purpose of Phoenix PRIME. (In fact, we think the equipment and music discounts aspects of the program will be much more important to the people who sign up, at least in the beginning.)

Venues that knowingly hire pirate KJs will continue to be targeted for suits, but that has nothing to do with what we're doing regarding direct services.



The PRIME agreement between Phoenix and the KJ will be available a week from today. The agreements between us and the venues will not be released to the KJs or the public.

Sadly, however, you (specifically Mr. Staley) won't be able to sign up without some significant changes to your operation.



To be hired by us to provide services, you will most definitely be required to meet our standards, just like any other gig would require. I'm moderately surprised that anyone would find that controversial.



I'm not "insisting" on anything, and certainly not based on the absence of a magic word in an agreement.

A "franchise" requires the presence of three elements:

(1) a trademark license;
(2) significant control over the licensee's operations; and
(3) payment of at least $500 to the licensor before or withing 6 months after beginning operations.

As you can see, right there on the page, we do not require payment of at least $500. In fact, no part of the annual fee is associated with providing services to Phoenix.

Perhaps even more importantly, we are not setting up an arrangement in which a KJ runs an independent business as "Sound Choice." KJs will be providing services to us, and they will be paid to do so.

Generally in the entertainment business 'Agents' and/or 'Managers' operate on a percentage basis. So what's the split with PEP?

"Employees and contractors".... so now you will have "employee KJ's?" and will you be supplying these "employees" with the entire library of SC trademarked material or will they be required to purchase a "help license" so they can use pirated material?

This kind of underlines my predictions years ago that you'd do something like this with the statement in your trademark application that reads:

Congratulations to all those KJ's that need work, you can now work directly for Kurt and Harrington.

"music discounts?" You don't sell anything new so that's not much of help there. But, if you let them use the trademark under your name, I guess that they can use the entire library free..... as long as they work for you.

Well, even you admit that "accidents can happen" and that's a great door-opener to prevent it from happening again... if they hire you.

You think it will remain a secret? Really?

I'm crushed.... You mean that in order to be booked by you, I have to agree to using your tracks? You want to control that much?.... Oh, that's right, I'd have to be "an employee" of yours. No thanks.

It's not at all. No booking agent would hire someone that sucks. But this is not an independent contractor relationship is it? Nope. It's an employer/employee relationship complete with W2 forms, worker's compensation insurance etc... (and you can pay the medical bills for the first KJ that gets duked by a drunk.)

Remember that if you demand too much control of your "contractors" they won't pass the IRS control tests as independent... You can't have it both ways... And many states require that you provide workers' compensation insurance even for independent contractors. You'll need to provide that proof to your "contractors" in states that require it.

"Annual Fee?" So the payment isn't within the "FIRST 6 months" but you can make it an "annual fee." I can guess this annual fee doesn't apply to "employees?"

F-R-A-N-C-H-I-S-E. Period...



Yeah, like a franchise... but with a different name...

I am so glad that I'm not the "I told you so" type....

I would like to know more about the training courses.

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KNOW THYSELF

We won't be operating on an agent/manager basis. KJs who work for us will be paid a negotiated rate for the services performed. Our share will be determined by the rate we negotiate with the venues. We think we can push rates higher by offering services that are difficult for operators who run 1-5 systems to provide, specifically around promotional work and social media. The result is more money for the KJs we hire.

We're in the process of developing training materials, workshops, and videos for our member KJs on a wide range of topics, everything from basic audio engineering principles to equipment selection to business accounting to social media engagement. Because we are planning to expand beyond karaoke, we'll also be teaching KJs how to run other types of pub entertainment more effectively.

One thing we've learned as we've done investigations over the last 7 years is that a lot of people get into this business with really good skill sets in some aspects of the business but poor practices in others. You can be a really charismatic host who makes mistakes in setting up the sound equipment. Or you have great sound equipment and know how to set it up, but be lost when it comes to running the business aspects.

One of the things we believe about this industry is that by helping legal KJs become more effective at all aspects of the profession, we can give them a bigger edge over the pirate who runs crappy shows for $50.

Based on past experience i seriously doubt this would benefit someone in Canada at least initially

I think i will pass

sounds interesting tho

We will have some KJs as employees, and those employees will be using equipment and music that we own and/or subscribe to. We'll be using SC music as well as music from other producers, where appropriate.



We've been doing this kind of thing for many, many years on a small scale. We're now taking that to the next level.



We're definitely looking for high-quality KJs to work for us as contractors and, in some markets, as employees.



That's not how it works. But I'm glad to have angered you into incoherence yet again.



It's true: Venues that hire us don't have to worry about getting sued by us. By hiring us, they are ensuring that the services they receive are fully licensed.



I didn't say it would remain a secret, just that we're not going to release it. I suppose there's nothing to keep you from haranguing venues that hire us into letting you see the contract. But it's sort of hard for you to continue to do that sort of thing and claim you're not obsessed with us.



You wouldn't have to be an employee of ours to participate in Phoenix PRIME. But you'd have to get licensed, and that would require you to swallow your pride.



In some cases, it would be an employer-employee relationship; in others, it will be an IC relationship. Regardless, we will follow all applicable labor laws in the jurisdiction where we're operating.



It's cute that you think we're somehow unaware of the legal requirements for operating in the states where we operate.



Phoenix PRIME requires an annual fee of either $199 or $349, depending on which level of membership you choose. Both of those numbers are less than $500; ergo, no franchise. (There are other reasons why this isn't a franchise, but that one is sufficient.)

Aside from the music discounts, which by themselves are probably a wash at best, the main financial benefit of the program is the music discount program. I'm not sure that any of the retailers we're negotiating with have Canadian outlets--I'd have to check on that--but assuming they don't, you're right, it probably wouldn't make sense for Canadians right now.

I bet someone like Chris Avis (has independent KJ business with many gigs/venues in Seattle area) would JUMP at the opportunity to either compete directly with you or become your DIRECT EMPLOYEE!

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"You know that I sing the Blues and I do not suffer fools. When I'm on that silver mic, it's gonna cut ya, just like a knife"-The SWINGCAT

It's important to remember that Phoenix PRIME is NOT the same as our direct services initiative, although it is somewhat related. While we'd love to have Chris as a Phoenix PRIME member, it's up to him to decide whether what we can offer him is worth the price.

As far as direct services go, I don't think it's our goal to compete against Chris or against any of the hundreds of other SC licensees who are already in place. That's not to say we won't enter their markets, either. There is plenty of work to be done in every market around the U.S. The business case for what we're doing is based in part on setting a standard for professionalism--one that people like Chris already meet, but that is sorely lacking in many people who work as KJs. We think that karaoke venues will respond to an operation that shows up on time, supplies first-rate equipment, puts on an entertaining and technically well executed show, doesn't pirate its music, fully engages with the audience through promotion and social media, and has a national footprint. Our service will cost venues more than the $50 "B&P" KJ, but it will be more than worth it because we will be able to drive significantly greater revenue to the venue. That will put more money in KJs' pockets, too--those who work with us, and those who don't but meet the standard we set. Competition doesn't always have to be a race to the bottom. We intend to make it a race to the top.

By the way, we've hired a working KJ, the owner of a well-run pub entertainment operation, to help us get this project off the ground.

wait.....
first you were a karaoke manufacturer helping karaoke hosts
then you were a lawsuit company suing karaoke hosts
now you are a karaoke hosting company competing against those same hosts?

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Paradigm Karaoke, The New Standard.......Shift Happens

I personally think this is a good thing. We need innovation and new models in this industry (bar/restaurant). Nothing wrong with business owners adapting their business model to a changing marketplace. And as someone who has been in franchise sales for many years, this is a long way from being a franchise. There is so much legal red tape and hoops to jump through in order for the government to bestow the "franchise" tag on your company. Just meeting those simple requirements is not even close. Additionally, franchisers are heavily regulated
and documented by the FTC and it would take most any company quite a while to set themselves up as a franchise operation.

There are lots of KJs who can run a show well but have no idea about running a business, maybe this will give some of those folks a chance to do something different.