Indie Producers and Copyrights in the Musical Compositions Contained in their Masters
Before the genesis of hip-hop in the early 1970s and the emergence of producers like Kool Herc, the role of producers was not to create music, but to help artists record their music and make it as professional as possible. However, that has all changed. In pop, R&B, and especially hip-hop, producers do create new music by providing beats or even complete music floors over which an artist sings. In that case, the producer is creating two copyrights: 100% of the sound recording and a part of the musical composition. Therefore, producers often sign publishing deals. The producer will generally have to transfer the copyright in any part of the musical composition that they contributed, such as the beat.
Sync and Master Use Fees
Companies that wish to use an indie musician’s music for a movie, commercial, TV show or video game often will offer an up-front, one-time payment generally called a “sync” fee (even if the songwriter is transferring rights in both the song and the master). The amount of the fee, if any, will depend on a variety of factors including:
• The professional standing of the musician: If an ad agency regularly turns to certain producers to create music for a client’s ads, it probably will have worked out a standard fee with that producer.
• The nature of audiovisual work for which the music is sought and whether the song was a hit: A major motion picture will usually pay from $10,000 to $25,000 for a song or master by an indie writer, artist or producer. However, the exact amount depends on how many times the song is played and if it will be used in the beginning or end credits (there is also often an additional fee if the song is used in the trailer). But, an indie filmmaker may only be able to afford $5,000 or less for any song or master. Don’t be surprised if they offer you no more than a credit. At the beginning of your career, a credit on the movie and on IMDB (an online database of information related to films, television programs, and video games, including cast, production crew such as music composers and musicians, biographies, plot summaries, trivia and reviews) could be valuable. In contrast, a pop hit in major studio movie can easily fetch $100,000 or more.
• The type of TV commercial: In the case of a TV spot, the biggest factor is whether the commercial is national (which may pay from several thousand to over $10,000 for an indie song or master) or will only play in one or several markets (which often pays less). But, for a hit song, the fee could well be in the six figure range and even more for a hit by a superstar artist.
• The type of TV program: Here, the most important factor is whether the program is network or basic cable. Usually, but not always, network shows will pay better than shows on basic cable. The money for an indie songwriter or producer could range from no more than the royalty payable to the songwriter by his Performance Rights Organization (see below) to $2,500 to more than $10,000 depending on how much the production company or network wants the music.
• Who owns what: If the master and the song are owned by different parties—for instance, if you wrote the song but your producer owns the track—a license will be needed with each of you.
Additional Income for Public Performance
A songwriter may earn “public performance” income from the songwriter’s Performance Rights Organization or “PRO” (i.e., ASCAP, BMI, SESAC or the recently organized Global Music Rights or GMR) when her music is “publicly performed.” For instance, a songwriter can receive money when her music is broadcast as part of a television show or played on a computer game. This income may be the only income that an indie songwriter receives, or could be in addition to the up-front sync fee.
Each PRO has rules that determine the amount of money that should be paid for a performance in an audiovisual work. The public performance income from a song in an audiovisual work can be substantial in some situations. For instance, if music is used in a national TV commercial that airs on network TV, the PRO royalty can exceed the sync fee. In contrast, when a small amount of a song is used in the background of a single scene in a basic cable program, the public performance income can be very small.
When the public performance income will be substantial, you may decide to accept a lower sync fee rather than potentially losing the deal altogether. Note that we are only discussing the public performance income payable for the musical composition. The same considerations do not apply to the owner of the master recording—i.e., an artist or a producer. Under U.S. copyright law, the owners of master recordings, unlike the owners of the underlying songs, are not entitled to public performance income for the broadcast of their recordings except via digital transmission such as Spotify, YouTube and Pandora, etc. If a commercial is intended to play on network TV, the commissioning company will generally try to get Internet rights for little or no additional compensation (see Media below).
SoundExchange, similar to the PRO’s for compositions, collects income for the public performance of music recordings, but only for audio-only Internet Radio services such as Pandora. The situation is different in most foreign countries, where artists can earn performing rights royalties for the “public performances” of their master recordings on television as well as standard broadcast radio.
In short, the owner of the master recording’s only source of U.S. income from the master use license will be the up-front master use fee, which she receives from the company for a TV commercial, movie or TV show. If the owner of the master is not the songwriter, he will not be receiving any public performance income from the PRO’s (or SoundExchange), so he may feel more of a need than the songwriter to negotiate the highest possible up-front fee.
