R8R Music Publishing

R8R Music Publishing
(registered with ASCAP)

In the music industry, a publishing company is responsible for ensuring the songwriters and composers receive payment when their compositions are used commercially. Through an agreement called a publishing contract, a songwriter or composer "assigns" the copyright of their composition to a publishing company. In return, the company licenses compositions, helps monitor where compositions are used, collects royalties and distributes them to the composers. A publisher also secures commissions for music and promote existing compositions to recording artists, film and television.

The copyrights owned and administered by publishing companies are one of the most important forms of intellectual property in the music industry. (The other is the copyright on a master recording which is typically owned by a record company.) Publishing companies play a central role in managing this vital asset.

Successful songwriters and composers have a relationship with a publishing company defined by a publishing contract. The publisher agrees to see to it that the composers receive royalties from various uses of their compositions. They also provide substantial advances against future income.

There are several types of royalties: mechanical royalties derive from the sale of recorded music, such as CDs or digital downloads. These royalties are paid to publishers by record companies (through the Harry Fox Agency as well as through American Mechanical Rights Agency in the U.S.). Performance royalties are collected by performance rights organizations such as SESAC, BMI or ASCAP and are paid by radio stations and others who broadcast recorded music. Synchronization royalties are required when a composition is used in a film or television soundtrack. These royalties typically pass through the hands of a music publisher before they reach the composer.

Publishers also work to link up new songs by songwriters with suitable recording artists to record them and to place writers' songs in other media such as movie soundtracks and commercials. They will typically also handle copyright registration and "ownership" matters for the composer. Music print publishers also supervise the issue of songbooks and sheet music by their artists.

Examples: Synchronization royalties are continually issued to Viscosity Breakdown's track "Art of Waking" (licensed for an episode of MTV's show "Made") and more commonly, mechanical royalties are paid to various artists for downloaded ringtones.


Music Publishing: Mechanical Royalties

R8R Music Publishing
Mechanical Royalties

A mechanical license grants the rights to reproduce and distribute copyrighted musical compositions (songs) on "phonorecords" (i.e. CDs, records, tapes, and certain digital configurations). Simply stated, if someone wants to record and distribute a song that was written by someone else, or if a business requires the distribution of music that was written by others, you must obtain a mechanical license.

Mechanical rights should not be confused with "master rights" that are granted by a record company in order to use an existing recording, or with "performance rights" that are granted by publishers or societies for the public performance of a song. Depending on the use, one may also have to obtain these rights in addition to the mechanical license.

"Phonorecords" can include:


Music Publishing: Performance Royalties

R8R Music Publishing
Performance Royalties

In the conventional context, royalties are paid to composers and publishers and record labels for public performances of their music on vehicles such as the jukebox, stage, radio or TV. Users of music need to obtain a "performing rights license" from music societies (Performing Rights Organizations (PROs), such as ASCAP) to use the music. Performing rights extend both to live and recorded music played in such diverse areas as bars, cafés, skating rinks, etc.

Typically, the PRO negotiates blanket licenses with radio stations, television networks and other "music users", each of whom receives the right to perform any of the music in the repertoire of the PRO for a set sum of money. PROs use different types of surveys to determine the frequency of usage of a composition/song. For example, ASCAP uses random sampling.

"Performance" in the music industry can include:


Music Publishing: Synchronization Royalties

R8R Music Publishing
Synchronization Royalties

Synchronization royalties ("synch licenses") are paid for the use of copyrighted music in (largely) audiovisual productions, such as in DVDs, movies, and advertisements. Music used in news tracks are also synch licenses. Synchronization can extend to live media performances, such as plays and live theatre. They become extremely important for new media - the usage of music in the form of mp3, wav, flac files and for usage in webcasts, embedded media in microchips (e.g. karaoke), etc but the legal conventions are yet to be drawn.

Synchronization royalties are due to the composer/song-writer or her publisher. They are strictly contractual in nature and vary greatly in amount depending on the subjective importance of the music, the mode of production and the media used. The royalty payable is that of mutual acceptance but is conditioned by industry practice.

It is useful to note in this connection the concept of the "needle drop" (now "laser drop") in that the synch royalty becomes payable every time the needle drops "on the record player" in a public performance! All openings and closings, every cut to advertisements, every cut back from ads, all re-runs shown by every TV company, in every country in the world generates a "synchro", although a single payment may be renegotiable in advance.


Music Publishing: Contracts

R8R Music Publishing
Contracts

A publishing contract is a legal contract between a publisher and a writer or author (or more than one), to promote and publish original material by the writer(s) or author(s). This may involve a single original work, or a series of works.

The typical music publishing contracts are:

(1) Single Song Agreement: A single song deal is an agreement between the writer and the music publisher in which the writer grants certain rights to a publisher for one or more songs. In single song deals, the writer is paid a one-time recoup-able advance.

(2) Exclusive Song Writer Agreement ("ESWA"): Under the ESWA or "staff writer" contract, the song writer generally grants all of the publisher’s share of the income to the music publisher. The writer’s services are exclusive to the music publishers for a specified period of time. Thus, any compositions written within that period belong to the music publisher. These deals are usually offered to writers with some degree of success. Because the writer has a track record of writing hits, the publisher feels confident that it will recoup its investment. In return for signing away exclusive rights to some or all the writer’s songs, the writer gets paid by the publisher a negotiated advance against future royalties. The advance amount naturally depends on the writer’s bargaining power and on the competition in marketplace, if any. Under a staff writer deal, the writer is paid on a weekly or quarterly basis. An ESWA can be either tied to a record contract, or independent of a record contract.

(3) Co-publishing Agreement ("Co-pub"): The co-publishing ("co-pub") deal is perhaps the most common publishing agreement. Under this deal, the songwriter and the music publisher are "co-owners" of the copyrights in the musical compositions. The writer becomes the "co-publisher" (i.e. co-owner) with the music publisher based on an agreed split of the royalties. The song writer assigns an agreed percentage to the publisher, usually (but not always), a 50/50 split. Thus, the writer conveys a percentage of the publisher's share to the publisher, but retains all of writer’s share. In a typical "75/25 co-pub deal," the writer gets 100% of the song writer’s share, and 50% of the publisher’s share, or 75% of the entire copyrights, with the remaining 25% going to the publisher. Thus, when royalties are due and payable, the writer/co-publisher will receive 75% of the income, while the publisher will retain 25%.

(4) Administration Agreement ("Admin"): An administrative agreement takes place between a songwriter/publisher and an independent administrator, or between a writer/publisher and another music publisher. In an "admin deal," the songwriter self-publishes and merely licenses songs to the music publisher for a term of years and for an agreed royalty split. Under this agreement, the music publisher simply administers and exploits the copyrights for another publisher/copyright owner. Only the most popular song writers can even consider asking for an admin deal. Under this coveted arrangement, ownership of the copyright is usually not transferred to the administrator. Instead, the music publisher gets 10-20% of the gross royalties received from administering and exploiting the songs for a certain period of time and for a certain territory.

(5) Collection Agreement: A collection agreement is like an admin deal where the writer retains the copyrights, except that the publisher does not perform exploitation functions; like an accountant or business manager, it merely collects and disburses available royalty income.

(6) Sub-publishing Agreement: These are basically music publishing deals in foreign territories between a US publisher and a publisher in a foreign territory. They are like admin or collection deals (with no ownership of the copyrights being transferred to the sub-publisher), but limited to one or more countries outside the US. Under this publishing deal, the publisher allows the subpublisher to act on its behalf in certain foreign territories. Often, they are limited to a group of countries, such as European Union (EU), GAS (Germany, Austria, Switzerland), Latin America, etc.

(7) Purchase Agreement: Under this agreement, one music publisher acquires in whole or in part the catalogue of another music publisher, sort of like a merger of companies. In this case, a "due diligence" investigation is done to determine the value of the catalogue.