Spotify. Where are you? That’s the question I pondered a few months back. Spotify has since arrived and I for one am hooked.
Spotify launched in the United States in the middle of the summer, making millions in legal music available to listeners. Many people noticed, and along with it’s release came the critics. While in the US Spotify is only a few months old in Europe the company is in its third year of operation. At a time when more music start-ups fail than succeed, that’s quite impressive. The critics aren’t all that impressed. In its short time indie labels are protesting Spotify, saying that the model isn’t financially sustainable for indie labels. Will Spotify pay up? Apparently it has – Spotify released a statement last month that in just three short years, where they were mostly operating in Europe, they have already paid over $100 million to labels and publishers. IFPI figures actually showed that Spotify was the second largest source of digital revenue for labels in Europe. Impressive for a little start-up.
Currently, users of the free Spotify accounts can listen to anything they want from the database, as many times as they want, with advertisements in between. The free trial lasts for 6 months. So what happens after? You can still access Spotify, but with a few restrictions. Listeners will only be able to play each track 5 times, and will only be able to listen for 10 hours a month. The move has worked well in Europe were restrictions are already in place. In March, when there were free restrictions, 17.8% of the active user play was paying users. By June, when the restrictions were in place, 32.9% were paying users. Sure they lost more than a million free users, but they also gained more than half a million paying users. It’s left to see what will happen in the US once the restrictions are enforced. Analysts however feel that once their financial-year-ending reports are released, Spotify will have turned a profit. Isn’t that the goal of all start-ups – to turn a profit within three years?
Are you using Spotify? When the restrictions are in place – will you begin paying for a subscription? I sure will. Having an artist’s entire catalog available to me at the click of a mouse is amazing.
References:
Spotify Payouts Top $100m as it Responds to Indie Label Critics
Exclusive: Spotify Subscriptions Surged to 1.5m After Free Service Restrictions
9.16.2011
9.04.2011
Artists & Social Media
Do-It-Yourself (DIY) artists are nothing new. Yet, as the digital landscape of the music industry keeps changing it’s important to use new technological initiatives to ones advantage. Receptive Music released the following infographic a few weeks ago.
At first glance it can be kind of over whelming, but if you break it down it’s much easier to navigate.
The Essentials:
Creating an online presence is the most important thing an artist can do to further their career. It’s not only about the music you play – but also about who you are. It’s important to create an avenue in which current and perspective fans can connect to you. Sites like Facebook and Twitter allow artists to directly engage with their fans. Artists should strive to make two-way conversations with people consistently.
Tyler Cordy, from the band 2AM Club, runs the band’s Twitter account and he makes it a point to communicate to the fans. If you mention the band, he’s more than likely going to respond to you. Fans love being noticed by their favorite bands – it makes them feel appreciated and as most musicians know, it’s now about the quantity of your fans, but the quality. One hundred die-hard fans will be more profitable to a band in the long run than one thousand casual fans.
Share Your Music:
After you’ve created an online presence it’s important to get your music out there and available to your fans. Websites such as SoundCloud allow you to upload your music and then share it through various platforms.
Sell Your Music:
While making your music available for streaming online is important – it’s also important to monetize your music. From direct-to-fan sales available through websites such as Audimated and Nimbit to digital distribution through TuneCore and ReverbNation, it’s important to find ways to monetize your music. The problem isn’t always that people don’t buy music – it’s that people can’t find the music to buy and thus resort to pirating it online. Making sure that your music is available online, as opposed to strictly physical copies sold at shows, is vital.
Tour Dates:
In the current music industry touring is one of the most profitable avenues for artists. It’s important that fans know when and where you’re performing, with enough time in advance that they can arrange to show up. It’s also important to list the details of a performance – cover charge, age restrictions, etc. Ex: If you’re performing at upscale clubs with a specific dress code make sure you let your fans know. Listing your tour dates on a website such as BandsInTown allows for not only your fans to find your tour dates, but also users who are in the city as well. At first login a consumer can see the tour dates of their favorite artists, as well as upcoming shows from other bands in their area. Plus they also send periodic emails to users informing them of shows in their areas.
Blog / Website:
While social networking websites allow you to directly engage with fans, it’s also important to maintain an artist presence outside of that – weather through a blog or a website. Tumblr provides the easiest form of blogging – that of micro blogging. Artists such as Pete Wentz have embraced the trend that allows you to share pictures, videos, audio, as well as short and long bursts of text.
Share Your Videos:
Video killed the radio star, at least that was the theory when MTV first premiered and launched with video from the Buggles in 1981. While MTV might not play as many videos as they used to, online platforms such as YouTube have allowed music videos to continue it’s rise. Some artists such as Soulja Boy and Rebecca Black have gained extensive media attention thanks to their YouTube video views. Creating a fancy music video is not a requirement though – sharing live performance videos works well too. Just make sure the audio isn’t distorted to the point that the music can’t be heard. Artists such as Lil Wayne have also taken it up another notch, using LiveStream and UStream to stream live footage in the studio.
Newsletter:
It’s also important not to forget about the marketing tool that preceded social networking – newsletters. Obtaining fan e-mail addresses is still an important aspect that should not be ignored. It also shouldn’t be limited to online. If possible try to obtain e-mails at shows and then proceed to send a show follow-up the next twenty-four hours. First time listeners of your music will be impressed, as will the loyal fans. Newsletters are also great for summarizing crucial band information and then sending it out to your fans. It’s imperative however not to bombard them with e-mails.
Measure:
After everything is said in then it’s important to measure the fruits of your labor. Knowing what platforms is attracting traffic, and which ones fans respond to more is important. It let’s you know what works, and what doesn’t. Measuring your visitors through websites such as Google Analytics also lets you know how the majority of your fans are reaching your pages. Active monitoring might lead you to find a page that’s supporting your music.
As the infographic points out – don’t take on more than you can handle. If your going to use the medium for a month and then abandon it, it’s best to just avoid it all together. No one wants to tune in to a page that hasn’t been updated in months. And if you’re still feeling overwhelmed – websites such as ReverbNation and TopSpin incorporate many of these tools into one platform. However they do charge you yearly fees.
References:
2AM Club Twitter
The Musician's Social Media Food Pyramid
25 Top Social Media Tools for Musicians
Video Killed the Radio Star YouTube Video
Pete Wentz's Tumblr
At first glance it can be kind of over whelming, but if you break it down it’s much easier to navigate.
The Essentials:
Creating an online presence is the most important thing an artist can do to further their career. It’s not only about the music you play – but also about who you are. It’s important to create an avenue in which current and perspective fans can connect to you. Sites like Facebook and Twitter allow artists to directly engage with their fans. Artists should strive to make two-way conversations with people consistently.
Tyler Cordy, from the band 2AM Club, runs the band’s Twitter account and he makes it a point to communicate to the fans. If you mention the band, he’s more than likely going to respond to you. Fans love being noticed by their favorite bands – it makes them feel appreciated and as most musicians know, it’s now about the quantity of your fans, but the quality. One hundred die-hard fans will be more profitable to a band in the long run than one thousand casual fans.
Share Your Music:
After you’ve created an online presence it’s important to get your music out there and available to your fans. Websites such as SoundCloud allow you to upload your music and then share it through various platforms.
Sell Your Music:
While making your music available for streaming online is important – it’s also important to monetize your music. From direct-to-fan sales available through websites such as Audimated and Nimbit to digital distribution through TuneCore and ReverbNation, it’s important to find ways to monetize your music. The problem isn’t always that people don’t buy music – it’s that people can’t find the music to buy and thus resort to pirating it online. Making sure that your music is available online, as opposed to strictly physical copies sold at shows, is vital.
Tour Dates:
In the current music industry touring is one of the most profitable avenues for artists. It’s important that fans know when and where you’re performing, with enough time in advance that they can arrange to show up. It’s also important to list the details of a performance – cover charge, age restrictions, etc. Ex: If you’re performing at upscale clubs with a specific dress code make sure you let your fans know. Listing your tour dates on a website such as BandsInTown allows for not only your fans to find your tour dates, but also users who are in the city as well. At first login a consumer can see the tour dates of their favorite artists, as well as upcoming shows from other bands in their area. Plus they also send periodic emails to users informing them of shows in their areas.
Blog / Website:
While social networking websites allow you to directly engage with fans, it’s also important to maintain an artist presence outside of that – weather through a blog or a website. Tumblr provides the easiest form of blogging – that of micro blogging. Artists such as Pete Wentz have embraced the trend that allows you to share pictures, videos, audio, as well as short and long bursts of text.
Share Your Videos:
Video killed the radio star, at least that was the theory when MTV first premiered and launched with video from the Buggles in 1981. While MTV might not play as many videos as they used to, online platforms such as YouTube have allowed music videos to continue it’s rise. Some artists such as Soulja Boy and Rebecca Black have gained extensive media attention thanks to their YouTube video views. Creating a fancy music video is not a requirement though – sharing live performance videos works well too. Just make sure the audio isn’t distorted to the point that the music can’t be heard. Artists such as Lil Wayne have also taken it up another notch, using LiveStream and UStream to stream live footage in the studio.
Newsletter:
It’s also important not to forget about the marketing tool that preceded social networking – newsletters. Obtaining fan e-mail addresses is still an important aspect that should not be ignored. It also shouldn’t be limited to online. If possible try to obtain e-mails at shows and then proceed to send a show follow-up the next twenty-four hours. First time listeners of your music will be impressed, as will the loyal fans. Newsletters are also great for summarizing crucial band information and then sending it out to your fans. It’s imperative however not to bombard them with e-mails.
Measure:
After everything is said in then it’s important to measure the fruits of your labor. Knowing what platforms is attracting traffic, and which ones fans respond to more is important. It let’s you know what works, and what doesn’t. Measuring your visitors through websites such as Google Analytics also lets you know how the majority of your fans are reaching your pages. Active monitoring might lead you to find a page that’s supporting your music.
As the infographic points out – don’t take on more than you can handle. If your going to use the medium for a month and then abandon it, it’s best to just avoid it all together. No one wants to tune in to a page that hasn’t been updated in months. And if you’re still feeling overwhelmed – websites such as ReverbNation and TopSpin incorporate many of these tools into one platform. However they do charge you yearly fees.
References:
2AM Club Twitter
The Musician's Social Media Food Pyramid
25 Top Social Media Tools for Musicians
Video Killed the Radio Star YouTube Video
Pete Wentz's Tumblr
8.19.2011
What's The Trend?
Trends are everywhere, and the music industry is no exception. However, the Hip-Hop community tends to create and embrace their own trends in comparison to the rest of the industry. This year alone they have managed to create quite a few of them.
Self-Production: Fifteen years after the trend originally appeared it has come back again. The days are over where you are left to wonder who produced an album. The trend today is for emcees to produce their own album. It seems fitting that the artist who perhaps inspired this trend the most was Kanye West. In a time where labels envisioned Trackmasters, Timbaland, or Scott Storch to be the ‘it’ producers required to make a single take off, Kanye West was making award winning albums on his own. The labels took note – especially when they released they could potentially save thousands, if not millions, on paying third party producers. Today the one-man is in full effect with producers / artists such as K.R.I.T., Blu and J.Cole all set to release albums this year.
Female Vocal Appearances: Hip-Hop has always favored female hooks, particularly those by white females, but lately there has been more of them then ever before. One of the recent breakthroughs – Skylar Grey. Not only did she right the hook for Eminem’s award winning track “Love the Way You Lie” but in the past 8 month’s she’s also appeared on Diddy-Dirty Money’s “Coming Home”, Lupe Fiasco’s “Words I Never Said” and Dr. Dre’s “I Need a Doctor”, just to name a few. Katy Perry is on the opposite side of the spectrum. She began guest appearing on Timbaland’s “If We Ever Meet Again” and then recruited rappers Kanye West and Snoop Dogg for two different singles on her last album “Teenage Dream”. One of most addictive hooks of the past year – Hayley Williams on B.o.B’s “Airplanes”. Seriously – if you weren’t singing it along in your head, reading it on Facebook statuses or on twitter feeds – something is wrong.
Album Delays: The classic album delays. No genre of music knows this better than that of Hip-Hop. Die-hard enthusiasts are still waiting for the day when Dr. Dre’s long anticipated album “Detox” is finally released. For years Dr. Dre has promised that ‘Detox was coming’. Release date after release date have come and gone, presumed singles have been released, and yet “Detox” appears to be a far away fantasy. For others, such as Kanye West and Jay-Z, after some release dates have past, the album suddenly drops with a week’s notice. Since January listeners had been waiting for the artists’ collaboration “Watch the Throne”. After the March release date passed with no release the album suddenly had a release date announcement, one week prior to the release. Since there wasn’t release date anticipation, leakers were unable to get their hands on the music and thus the album was actually released without being leaked, perhaps part of their strategy the entire time.
All of these trends have lead to hip-hop flooding the charts again like it once did – a quick look at Billboard’s Hot 100 for the week of August 27,2011 and one can see that 10 of the top 25 chart positions are held either by hip-hop artist or feature a hip-hop artist. Quite a feat for a genre that at one point in time was considered to be a passing fade.
References:
One-Man Armies – The Return of The Emcee/Producer Extraordinaire
Viva La White Girl – 5 Voiced Every Rapper Wants on Their Hit
The Big Pushback – Rappers & Labels Strategically Delaying Albums
Billboard Hot 100
Self-Production: Fifteen years after the trend originally appeared it has come back again. The days are over where you are left to wonder who produced an album. The trend today is for emcees to produce their own album. It seems fitting that the artist who perhaps inspired this trend the most was Kanye West. In a time where labels envisioned Trackmasters, Timbaland, or Scott Storch to be the ‘it’ producers required to make a single take off, Kanye West was making award winning albums on his own. The labels took note – especially when they released they could potentially save thousands, if not millions, on paying third party producers. Today the one-man is in full effect with producers / artists such as K.R.I.T., Blu and J.Cole all set to release albums this year.
Female Vocal Appearances: Hip-Hop has always favored female hooks, particularly those by white females, but lately there has been more of them then ever before. One of the recent breakthroughs – Skylar Grey. Not only did she right the hook for Eminem’s award winning track “Love the Way You Lie” but in the past 8 month’s she’s also appeared on Diddy-Dirty Money’s “Coming Home”, Lupe Fiasco’s “Words I Never Said” and Dr. Dre’s “I Need a Doctor”, just to name a few. Katy Perry is on the opposite side of the spectrum. She began guest appearing on Timbaland’s “If We Ever Meet Again” and then recruited rappers Kanye West and Snoop Dogg for two different singles on her last album “Teenage Dream”. One of most addictive hooks of the past year – Hayley Williams on B.o.B’s “Airplanes”. Seriously – if you weren’t singing it along in your head, reading it on Facebook statuses or on twitter feeds – something is wrong.
Album Delays: The classic album delays. No genre of music knows this better than that of Hip-Hop. Die-hard enthusiasts are still waiting for the day when Dr. Dre’s long anticipated album “Detox” is finally released. For years Dr. Dre has promised that ‘Detox was coming’. Release date after release date have come and gone, presumed singles have been released, and yet “Detox” appears to be a far away fantasy. For others, such as Kanye West and Jay-Z, after some release dates have past, the album suddenly drops with a week’s notice. Since January listeners had been waiting for the artists’ collaboration “Watch the Throne”. After the March release date passed with no release the album suddenly had a release date announcement, one week prior to the release. Since there wasn’t release date anticipation, leakers were unable to get their hands on the music and thus the album was actually released without being leaked, perhaps part of their strategy the entire time.
All of these trends have lead to hip-hop flooding the charts again like it once did – a quick look at Billboard’s Hot 100 for the week of August 27,2011 and one can see that 10 of the top 25 chart positions are held either by hip-hop artist or feature a hip-hop artist. Quite a feat for a genre that at one point in time was considered to be a passing fade.
References:
One-Man Armies – The Return of The Emcee/Producer Extraordinaire
Viva La White Girl – 5 Voiced Every Rapper Wants on Their Hit
The Big Pushback – Rappers & Labels Strategically Delaying Albums
Billboard Hot 100
8.18.2011
A Music Supervisor's Favorite Resource
Everyone knows that licensing music for movies and television shows can provide excellent returns – not only monetary but also in exposure. Music Supervisors are the most powerful individuals when it comes to this and use their own method of acquiring music that doesn’t involve calling individuals.
Music Supervisors frequent production music libraries because they can deliver any kind of music. No matter how obscure or otherwise difficult to obtain, one of more production libraries will have it. While they originally only contained background sound, production libraries today are much more than that. They discover groups, form record labels and forge alliances with clients in film and television. One of the greatest features of a production library, and a music supervisor’s favorite attribute, is that all the music they possess has been cleared. All the paperwork has already been done and it’s clear who the licensor is – so there is an unlikely chance that a problem with the license would appear. A music supervisor’s worst nightmare is finding out days before a project is to be released that there is a problem with a song that they were using for a scene and they can no longer use it. Using a production company minimizes greatly the chance that this would occur. Artists need to remember that to a music supervisor the quality of your music may matter less than the ability to achieve clearance. Paperwork and logistics can be a major roadblock. Production companies list meta-data standards to make sure that all the music in their catalogs meets certain requirements. Incorrect meta-data results in the legal department getting involved and using production libraries avoids such a mess.
Timing also comes into play when music supervisors decide to use production libraries. Many times a music supervisor will have a complex need to fill – a Latin-reggae tune in the style of a known artist but inexpensive – and will need it fast. For the most part production libraries have extensive catalogs – and if music supervisors use them often enough they can have some negotiation power over the price of a license.
So what does this mean for musicians? One thing is certain - instead of trying to get your music to a music supervisor, it might be wiser to get your music into a production library.
Reference:
What Music Supervisors Wish You Knew
Music Supervisors frequent production music libraries because they can deliver any kind of music. No matter how obscure or otherwise difficult to obtain, one of more production libraries will have it. While they originally only contained background sound, production libraries today are much more than that. They discover groups, form record labels and forge alliances with clients in film and television. One of the greatest features of a production library, and a music supervisor’s favorite attribute, is that all the music they possess has been cleared. All the paperwork has already been done and it’s clear who the licensor is – so there is an unlikely chance that a problem with the license would appear. A music supervisor’s worst nightmare is finding out days before a project is to be released that there is a problem with a song that they were using for a scene and they can no longer use it. Using a production company minimizes greatly the chance that this would occur. Artists need to remember that to a music supervisor the quality of your music may matter less than the ability to achieve clearance. Paperwork and logistics can be a major roadblock. Production companies list meta-data standards to make sure that all the music in their catalogs meets certain requirements. Incorrect meta-data results in the legal department getting involved and using production libraries avoids such a mess.
Timing also comes into play when music supervisors decide to use production libraries. Many times a music supervisor will have a complex need to fill – a Latin-reggae tune in the style of a known artist but inexpensive – and will need it fast. For the most part production libraries have extensive catalogs – and if music supervisors use them often enough they can have some negotiation power over the price of a license.
So what does this mean for musicians? One thing is certain - instead of trying to get your music to a music supervisor, it might be wiser to get your music into a production library.
Reference:
What Music Supervisors Wish You Knew
7.31.2011
Expert Advice Courtesy of a Podcast
Today the Internet makes it remarkably easy to seek the information that you need. With a simple click of a mouse you can find a plethora of resources at your fingertips. Podcasts for example, are a great way to gather information from the experts.
Mark Quail is an attorney who specializes in Entertainment and Media Law. Mark Quail produced a podcast entitled ‘Music Law Publishing’ that deals with the music publishing industry. The podcast is broken down into two parts and can be found here. The first half of the podcast deals with the different licenses that are assigned in relation to musical compositions in the music publishing industry in order to monetize the songs value and garner monetary compensation for the songwriter.
Mechanical Licenses grant permission to record labels so they can manufacture sound recordings. In the US the royalty rate for mechanical licenses is set at 9.1 cents for musical compositions 5 minutes in length or less and an additional 1.75 cents per minute for each minute over 5 minutes. Outside of the US & Canada, the royalty rate is calculated as a percentage rate of the wholesale price. In either case the record label manufacturing the record pays royalties.
Public Performance licenses control the performance of a song in public. This includes radio stations, television, restaurants, clubs and other venues that use music. Synchronization licenses dictate the terms in which a television or movie production can use a song in their work. These fees are dictated by the market and are reached by negotiation. Print licenses allow for the musical work to be sold or distributed in print form – this includes sheet music and folios, as well as the lyrics printed inside CD booklets. The final license is a new media license. This allows songwriters to license their compositions for greeting cards, midi files, streaming and/or downloads as well as software programs.
Each of these licenses comprises a different amount of a music publisher’s total annual earnings. Currently public performance royalties and mechanical royalties account for the bulk of total annual earnings. However, Quail points out that the other licensing opportunities should not be ignored. This is great advice for music publishers who more often like to go after the deals that look more financially enticing.
The second half of the podcast deals with the different types of publishing contracts. A full publishing contract is a 50/50 split of ownership in the musical work’s copyright as well as in the profits derived. This is what makes you think of a ‘songwriter’s share and a publisher’s share’ when you think of dividing the royalties. A co-publishing contract can be thought to be a 75/25 split of ownership. The songwriter retains the ‘songwriter’s share’ as well as ‘50% of the publisher’s share’. These are the most prevalent forms of publishing agreements. Administration Contracts are the most attractive to songwriters but are usually harder to obtain. Under this type of contract the publisher handles all of the copyright administration but does not retain ownership. They receive anywhere from 5% to 25% of net receipts of typical revenue and up to 40% of net receipt for sync licenses. The final contract is a sub-publishing contract. These types of contracts are usually entered into by the original publishing company and are considered to be administration contracts that are focused on one or more countries outside of the songwriter’s home territory.
The Chicago Music Commission is nonprofit organization formed from members in the Chicago music community. They hosted a panel on intellectual property and legal issues that can be heard here. The panel begins my hammering in what most artists should already know – having legal representation in this industry is a must. Legal representation is important because everyone else you deal with in the industry understands that this is a business. If they understand legal and business aspects and you don’t, then your not on an even playing field, therefore you’re not fighting a fair fight with who ever you are trying to negotiate, be it a booking agent or a record label. They also point out that you want to build a team of people who are on your side and looking at things from your perspective, because the people who want to use you will tell you things from their perspective, and not yours.
The panel also proceeds to dispute what has at one point been called ‘the poor man’s copyright’. It has long been assumed in the music industry, by musicians starting out, that you can simply send yourself a copy of your work by registered mail and that the postmark date will serve as the date of copyright. The panel points out that there is no value in mailing something to oneself. In a courtroom it doesn’t prove anything and won’t hold up as evidence.
Daniel Friedman is an Entertainment Attorney who took time from his busy schedule to speak at a music industry forum at Loyola University to speak on artist contracts. The video podcast can be found here. Friedman’s main discussion topic is on Copyrights. One of his main points is emphasizing the difference between a musical work and a sound recording. Both of which will have separate copyrights. The musical work is the underlying musical composition. The songwriter owns the musical work until the songwriter chooses to sign a publishing deal. The sound recording is the version of the song. It is owned either by the artist who covers it or belongs to the record company if the artist is signed to a record label contract. Friedman cleverly points out that – “the real estate of the music business is the copyright to the musical work”.
Friedman continues to talk about joint works. Unless you agree otherwise, the song is owned equally. There must be an agreement to identify the splits otherwise. Lyrics are generally 50% of a song and the music is generally the other 50% of a song. In hip-hop when a producer makes the beat and an artist rhymes over it, it is said the producer has created the music, and thus owns 50% of the copyright. With a band the theory is that the songwriter wrote the song and thus should own 100% of the copyright. However it can also be said that without the band there would be no way to exploit the song. Friedman suggests forming a hybrid between the two scenarios where the songwriter receives more of the copyright share than the rest of the band.
One of his final points is the provision that is often found in recording contracts for artists / songwriters. The controlled composition clause generally provides the recording artist / songwriter to sign for a lower mechanical rate than what they would usually receive. The industry standard tends to be 75% of the standard rate and is usually capped at 10, meaning if the artist releases more than 10 songs on an album; those additional songs are essentially ‘free to the label’.
That’s quite a lot of information to take in from three podcasts, but what better way to obtain your information that from industry experts and attorneys who specialize in the entertainment industry. By listening to three podcasts I have garnered more information about the different types of publishing agreements, the different publishing revenue streams and the fees associated with each type of licenses.
References:
Music Law Publishing
Chicago Music Commission – Musicians at Work Forum
Music Industry Forum – Daniel Friedman
Mark Quail is an attorney who specializes in Entertainment and Media Law. Mark Quail produced a podcast entitled ‘Music Law Publishing’ that deals with the music publishing industry. The podcast is broken down into two parts and can be found here. The first half of the podcast deals with the different licenses that are assigned in relation to musical compositions in the music publishing industry in order to monetize the songs value and garner monetary compensation for the songwriter.
Mechanical Licenses grant permission to record labels so they can manufacture sound recordings. In the US the royalty rate for mechanical licenses is set at 9.1 cents for musical compositions 5 minutes in length or less and an additional 1.75 cents per minute for each minute over 5 minutes. Outside of the US & Canada, the royalty rate is calculated as a percentage rate of the wholesale price. In either case the record label manufacturing the record pays royalties.
Public Performance licenses control the performance of a song in public. This includes radio stations, television, restaurants, clubs and other venues that use music. Synchronization licenses dictate the terms in which a television or movie production can use a song in their work. These fees are dictated by the market and are reached by negotiation. Print licenses allow for the musical work to be sold or distributed in print form – this includes sheet music and folios, as well as the lyrics printed inside CD booklets. The final license is a new media license. This allows songwriters to license their compositions for greeting cards, midi files, streaming and/or downloads as well as software programs.
Each of these licenses comprises a different amount of a music publisher’s total annual earnings. Currently public performance royalties and mechanical royalties account for the bulk of total annual earnings. However, Quail points out that the other licensing opportunities should not be ignored. This is great advice for music publishers who more often like to go after the deals that look more financially enticing.
The second half of the podcast deals with the different types of publishing contracts. A full publishing contract is a 50/50 split of ownership in the musical work’s copyright as well as in the profits derived. This is what makes you think of a ‘songwriter’s share and a publisher’s share’ when you think of dividing the royalties. A co-publishing contract can be thought to be a 75/25 split of ownership. The songwriter retains the ‘songwriter’s share’ as well as ‘50% of the publisher’s share’. These are the most prevalent forms of publishing agreements. Administration Contracts are the most attractive to songwriters but are usually harder to obtain. Under this type of contract the publisher handles all of the copyright administration but does not retain ownership. They receive anywhere from 5% to 25% of net receipts of typical revenue and up to 40% of net receipt for sync licenses. The final contract is a sub-publishing contract. These types of contracts are usually entered into by the original publishing company and are considered to be administration contracts that are focused on one or more countries outside of the songwriter’s home territory.
The Chicago Music Commission is nonprofit organization formed from members in the Chicago music community. They hosted a panel on intellectual property and legal issues that can be heard here. The panel begins my hammering in what most artists should already know – having legal representation in this industry is a must. Legal representation is important because everyone else you deal with in the industry understands that this is a business. If they understand legal and business aspects and you don’t, then your not on an even playing field, therefore you’re not fighting a fair fight with who ever you are trying to negotiate, be it a booking agent or a record label. They also point out that you want to build a team of people who are on your side and looking at things from your perspective, because the people who want to use you will tell you things from their perspective, and not yours.
The panel also proceeds to dispute what has at one point been called ‘the poor man’s copyright’. It has long been assumed in the music industry, by musicians starting out, that you can simply send yourself a copy of your work by registered mail and that the postmark date will serve as the date of copyright. The panel points out that there is no value in mailing something to oneself. In a courtroom it doesn’t prove anything and won’t hold up as evidence.
Daniel Friedman is an Entertainment Attorney who took time from his busy schedule to speak at a music industry forum at Loyola University to speak on artist contracts. The video podcast can be found here. Friedman’s main discussion topic is on Copyrights. One of his main points is emphasizing the difference between a musical work and a sound recording. Both of which will have separate copyrights. The musical work is the underlying musical composition. The songwriter owns the musical work until the songwriter chooses to sign a publishing deal. The sound recording is the version of the song. It is owned either by the artist who covers it or belongs to the record company if the artist is signed to a record label contract. Friedman cleverly points out that – “the real estate of the music business is the copyright to the musical work”.
Friedman continues to talk about joint works. Unless you agree otherwise, the song is owned equally. There must be an agreement to identify the splits otherwise. Lyrics are generally 50% of a song and the music is generally the other 50% of a song. In hip-hop when a producer makes the beat and an artist rhymes over it, it is said the producer has created the music, and thus owns 50% of the copyright. With a band the theory is that the songwriter wrote the song and thus should own 100% of the copyright. However it can also be said that without the band there would be no way to exploit the song. Friedman suggests forming a hybrid between the two scenarios where the songwriter receives more of the copyright share than the rest of the band.
One of his final points is the provision that is often found in recording contracts for artists / songwriters. The controlled composition clause generally provides the recording artist / songwriter to sign for a lower mechanical rate than what they would usually receive. The industry standard tends to be 75% of the standard rate and is usually capped at 10, meaning if the artist releases more than 10 songs on an album; those additional songs are essentially ‘free to the label’.
That’s quite a lot of information to take in from three podcasts, but what better way to obtain your information that from industry experts and attorneys who specialize in the entertainment industry. By listening to three podcasts I have garnered more information about the different types of publishing agreements, the different publishing revenue streams and the fees associated with each type of licenses.
References:
Music Law Publishing
Chicago Music Commission – Musicians at Work Forum
Music Industry Forum – Daniel Friedman
7.10.2011
Copyright Infringement
Another day, another case of copyright infringement is filed. In the music industry, especially the hip-hop community, there is no shortage of copyright lawsuits. There have been a few cases this year however that have caught my eye.
Lil Wayne is no stranger to copyright infringement accusations. He even received a copyright infringement summons while in jail last year. This past week another producer has gone on record saying that Lil Wayne stole his song. Lil Wayne’s latest release – “How To Love” is said to be produced by hip-hop producer ‘Detail’. However indie producer Chief Stockton claims he made a strikingly similar beat in 2008, which was available on the website 'SoundCloud'. The video claiming the infringement was released by musicindustryreport.org in the end of June. If you listen to both tracks there is no denying that Chief Stockton’s beat is almost identical to the beginning of ‘How to Love’. As of late, Chief Stockton has not filed a lawsuit and it is unclear if we will pursue legal action. If he does – it will be the fourth lawsuit that Lil Wayne is hit with in the past two months alone.
(Source: Music Industry Report)
Synchronization licenses are required in order to sync copyrighted audio with moving images – commercials included – regardless of weather the master sound recording is used or not. During this year’s Super Bowl, Chrysler released a commercial for their new Chrysler 200 model. Less than a year later Audi has released a similar commercial using music that is clearly meant to sound like Eminem’s “Lose Yourself” but without a license from Eight Mile Style LLC, the publisher of Eminem’s copyrights. The song has an instrumental beat that is hard to mistake. Listening to Audi’s commercial you can tell that they were trying to avoid a licensing issue, however the commercial music bares ‘substantial similarity’ to the original. Eight Mile Style filed a lawsuit in Germany in June ordering a cease-and-desist letter as well as seeking damages. The commercial has not been released in the U.S. and after the filing of the lawsuit it is unlikely that it will.
(Source: Billboard)
There is no shortage of sampling in the music industry. The majority of samples can be cleared with an upfront fee, while others require a stake in copyright ownership. Musicians are advised time and time again to clear samples before they are used or face a possible lawsuit. This week Ghostface Killah, of rap group Wu-Tang Clan, became the latest lawsuit target. Since his 1996 debut, entitled ‘Iron Man’, Ghostface has been known to use the moniker of the same name, and now is being sued for illegally using the ‘Iron Man Theme’ on his album ‘Supreme Clientele’. According to the lawsuit, portions of which can be viewed here, “Ghostface copied verbatim the sound recording and musical composition of the “Iron Man Theme” on two places on his album Supreme Clientale: as the first track and part of the last track”. I went ahead and performed a search of the Ghostface tracks in the iTunes Store and guess what? It is the same exact thing. This isn’t just a sample – it’s a blatant copy. Ghostface’s lawyers will most likely sit there astonished and wonder how it is that this wasn’t cleared ahead of time. My opinion would be that this gets settled out of court – sooner rather than later.
(Source: All Hip-Hop News)
References:
'Iron Man' Composer Sues 'Ghostface' For Millions Over Sample, Name Use
Eminem's Publisher Files Lawsuit Against Audi's Chrysler-Like Ad
Indie Producer claims Lil Wayne stole the “How To Love” Beat From Him!
Lil Wayne is no stranger to copyright infringement accusations. He even received a copyright infringement summons while in jail last year. This past week another producer has gone on record saying that Lil Wayne stole his song. Lil Wayne’s latest release – “How To Love” is said to be produced by hip-hop producer ‘Detail’. However indie producer Chief Stockton claims he made a strikingly similar beat in 2008, which was available on the website 'SoundCloud'. The video claiming the infringement was released by musicindustryreport.org in the end of June. If you listen to both tracks there is no denying that Chief Stockton’s beat is almost identical to the beginning of ‘How to Love’. As of late, Chief Stockton has not filed a lawsuit and it is unclear if we will pursue legal action. If he does – it will be the fourth lawsuit that Lil Wayne is hit with in the past two months alone.
(Source: Music Industry Report)
Synchronization licenses are required in order to sync copyrighted audio with moving images – commercials included – regardless of weather the master sound recording is used or not. During this year’s Super Bowl, Chrysler released a commercial for their new Chrysler 200 model. Less than a year later Audi has released a similar commercial using music that is clearly meant to sound like Eminem’s “Lose Yourself” but without a license from Eight Mile Style LLC, the publisher of Eminem’s copyrights. The song has an instrumental beat that is hard to mistake. Listening to Audi’s commercial you can tell that they were trying to avoid a licensing issue, however the commercial music bares ‘substantial similarity’ to the original. Eight Mile Style filed a lawsuit in Germany in June ordering a cease-and-desist letter as well as seeking damages. The commercial has not been released in the U.S. and after the filing of the lawsuit it is unlikely that it will.
(Source: Billboard)
There is no shortage of sampling in the music industry. The majority of samples can be cleared with an upfront fee, while others require a stake in copyright ownership. Musicians are advised time and time again to clear samples before they are used or face a possible lawsuit. This week Ghostface Killah, of rap group Wu-Tang Clan, became the latest lawsuit target. Since his 1996 debut, entitled ‘Iron Man’, Ghostface has been known to use the moniker of the same name, and now is being sued for illegally using the ‘Iron Man Theme’ on his album ‘Supreme Clientele’. According to the lawsuit, portions of which can be viewed here, “Ghostface copied verbatim the sound recording and musical composition of the “Iron Man Theme” on two places on his album Supreme Clientale: as the first track and part of the last track”. I went ahead and performed a search of the Ghostface tracks in the iTunes Store and guess what? It is the same exact thing. This isn’t just a sample – it’s a blatant copy. Ghostface’s lawyers will most likely sit there astonished and wonder how it is that this wasn’t cleared ahead of time. My opinion would be that this gets settled out of court – sooner rather than later.
(Source: All Hip-Hop News)
References:
'Iron Man' Composer Sues 'Ghostface' For Millions Over Sample, Name Use
Eminem's Publisher Files Lawsuit Against Audi's Chrysler-Like Ad
Indie Producer claims Lil Wayne stole the “How To Love” Beat From Him!
6.18.2011
Spotify - Where Are You?
For months we’ve been subjected to speculation that Spotify, the music streaming service that has gained a massive following in Europe, would finally launch in the United States. The service, which is currently available in France, Finland, the Netherlands, Norway, Spain, Sweden, and the UK has steadily been making moves in the US, and might see a launch date before the end of the year. Unlike online radio and music streaming service Pandora, Spotify allows you to listen to any track you like, any time you like. Their premium service works on your mobile phone, and has an offline mode for playlists. The offline mode syncs your playlists to your computer or mobile phone, so you can listen to them without an Internet connection.
Last week Spotify signed an American distribution deal with Universal Music Group, the world’s largest music label. The service already has agreements with Sony and EMI Music Group and is now just waiting to sign a similar agreement with Warner Music Group. Many believe the service won’t go live without it, since it would offer a hole in the music catalog. Earlier this week they secured funding totaling $100 million based on a $1 billion valuation. The addition funding could further prove that Spotify’s launch in the U.S. is approaching. Spotify’s biggest obstacle might be the industry itself. They need to entice users to stream music rather than pirate it while at the same time not discourage them from buying it or becoming paying subscribers.
The question that remains is weather Spotify will be successful once it reaches the U.S. Personally I can almost guarantee that it will get users to try their free trial, after all – it lasts 6 months. How many other companies do you know that are willing to let you try their service for half of the year at no cost? It definitely has to the right idea at getting your foot in the door. Once you’ve used something for so long, it’s kind of hard to go without it, and the $10 monthly fee by not seem as bad. Personally I can’t wait – so Spotify – hurry up and get here.
References
Spotify sings Universal Music, may get to U.S. after all.
Spotify Closes New $100 Million Funding Round, U.S. Launch Nears
Can Spotify and Hulu Move Forward Without Killing The Businesses They Rely On?
Spotify.com
Last week Spotify signed an American distribution deal with Universal Music Group, the world’s largest music label. The service already has agreements with Sony and EMI Music Group and is now just waiting to sign a similar agreement with Warner Music Group. Many believe the service won’t go live without it, since it would offer a hole in the music catalog. Earlier this week they secured funding totaling $100 million based on a $1 billion valuation. The addition funding could further prove that Spotify’s launch in the U.S. is approaching. Spotify’s biggest obstacle might be the industry itself. They need to entice users to stream music rather than pirate it while at the same time not discourage them from buying it or becoming paying subscribers.
The question that remains is weather Spotify will be successful once it reaches the U.S. Personally I can almost guarantee that it will get users to try their free trial, after all – it lasts 6 months. How many other companies do you know that are willing to let you try their service for half of the year at no cost? It definitely has to the right idea at getting your foot in the door. Once you’ve used something for so long, it’s kind of hard to go without it, and the $10 monthly fee by not seem as bad. Personally I can’t wait – so Spotify – hurry up and get here.
References
Spotify sings Universal Music, may get to U.S. after all.
Spotify Closes New $100 Million Funding Round, U.S. Launch Nears
Can Spotify and Hulu Move Forward Without Killing The Businesses They Rely On?
Spotify.com
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