Transcript Music Business Handbook and Career Guide

Part 2: Songwriting, Publishing, Copyright, and
Licensing
Chapter 7
Start Thinking. . .
1.
A film producer wishes to use a published piece of
music.
How does he go about obtaining the license to do so?
b. With whom does he negotiate?
c. What kind of licenses are required?
d. How does the money he pays end up in the hands of
the copyright holder?
a.
Chapter Goalshttp://bit.ly/XjgVdc
 Learn that licensing is the process through which
copyright ownership is controlled and made
profitable.
 Discover how licensing organizations function to
collect and disburse royalties paid for music
performances.
 Examine the similarities and differences among
ASCAP, BMI, and SESAC.
 Gain awareness of the different kinds of music use
licenses, particularly mechanical and synchronization
licenses.
Music Rights: An Overview
 Protected music can only be used after permission
(license) granted
 Path of creation of copyright to collection of cash =
heartbeat of music business
 Most common licenses
 performance license (broadcast & nonbroadcast)
 synchronization license (video, film, tv, video games)
 mechanical license (issued for underlying song)
 master use license (issued for use of master recording)
 compulsory license (pays at statutory rate)
Music Rights: An Overview
[Insert Table 7.1]
Performing Rights Organizations
 Largest source of income for many composers and
publishers = licensed public performances
 U.S. recording artists historically not received
performance royalties (publisher/composer do)
 PROs Performance Rights Organizations:
 issue licenses
 collect and distribute royalties
 issue blanket performance licenses (versus source
licenses)
 collect $2 billion annually
Keeping Track of the Music
 PROs monitor marketplace data
 Royalty distribution
 determined by number and kind of performances
 Foreign collections
 Foreign subpublisher
Membership Options
 Songwriters can affiliate with only one PRO
 American Society of Composers, Authors and
Publishers (ASCAP)
 income, royalty distribution
 membership
 weighting performances
 Broadcast Music Inc. (BMI)
 membership
 income, royalty distribution
Membership Options
 SESAC
 sampling, accounting
 income, royalty distribution
 SoundExchange
 digital performance royalties
Mechanical Licenses
 For recordings distributed commercially only for
private use (home use…not commercial use)
 Negotiated mechanical license differs from statutory
compulsory license
 royalty rate may be lower (due to controlled composition
clause in contract with label)
 quarterly royalty accountings
 The Harry Fox Agency, Inc. issues mechanical license.
 Learn about compulsory licensing here:
http://bit.ly/bSKn9S
Synchronization Licenses
 Music timed to synchronize with action on the screen
 Three sources of film music
 work-for-hire
 independent contractor (retains copyright and possibly
publishing and negotiates royalties with producers of
film)
 use of previously copyrighted & published music
 Synchronization license fees vary
 European conditions
 TV movie rights
 New use rights
Cable Television Licenses
 The business of offering secondary transmissions of
primary material
 Compulsory license from Copyright Office
 Other cable TV licenses
 network agreements
 Satellite Home Viewer Act of 1988
Video Licenses
 Not addressed by 1976 Copyright Act
 Consensus:
1. all videos defined as audiovisual works
2. performance rights must be acquired by the party who
shows videos to public
3. payment to publisher for right to reproduce videos
Transcription Licenses
 Music used by syndicated programs, background
music companies, in-flight entertainment, music
library services
 Require mechanical license and performance license
 Negotiations with publisher or HFA
Special Use Permits
 Broadcast commercials
 often include the right to alter the words and music
 buy-out deal
 Video (electronic) games
 license negotiation based on many factors
Jukebox Licenses
 Performance licenses for nondramatic music
 JLO blanket license
 covers the use of music from all three PROs
 JLO handles rebates and new jukebox registrations
Dramatic Music Rights
 Compositions used in the context of a wider piece or in
the telling of a larger story
 Grand rights and small rights
 ASCAP, BMI, SESAC
 Broadway musical subsidiary rights
 Dramatic performances require
 license
 royalty payment
 rental of show’s book, score, and parts
Creative Commons
 Non-profit corporation founded in 2001 to facilitate
the distribution of copyrighted works
 The typical CC license
 gives “baseline rights” to worldwide distribution
 does not allow changes
 is free of charge
 requires copyright holder consent for use
 Most publishers do not allow CC licensing
For Further Thought. . .
 What are the implications of smartphones and other
digital devices on synch licenses?
 Discuss the various licenses that may be required for
music in film.
 Compare BMI, ASCAP, and SESAC in respect to their
ownership and not-for-profit status. What are the
advantages and disadvantages of joining either ASCAP
or BMI?