Music Business Handbook and Career Guide Part 2

Music Business Handbook and Career Guide Part 2: Songwriting, Publishing, Copyright, and Licensing

Music 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/Xjg. Vdc 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 Sound. Exchange 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/b. SKn 9 S

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?