Artist Development 14
by John Latimer
In addition to live performances and sales of recordings, one of the main sources of income for Artists in the music industry is that of licensing songs, ie: publishing. If the artist is a songwriter, the consideration of preparing to publish is an important part of the Artist Development Plan.
Songwriters are their own publishers until they enter into an agreement to license their songs to a third party; preferably a qualified, connected and respected music publisher. This includes the songwriter-artist asking the band to consider using the songwriter’s next big hit. Publishing is the pitching of the song. That’s a different “hat” to wear than that of a songwriter. It’s also a different hat than that of a performer or musician. As soon as the songwriter takes that song to someone to perform it… maybe it’s the artist’s band, or maybe it’s the songwriter themselves, that songwriter is now wearing the publishers hat. A publisher’s job is finding commercial uses for a song. Publishers try to convince others to use the song for such things as performances and recordings as well as use in film and television or the gaming industry. Do you see how that’s a completely different “hat” than that of a songwriter? A publisher has to make a sale and find a commercial use for the song. That’s how they get paid. That’s how they make money. Publishing is indeed another income source for the artist who is a songwriter. This is the songwriter-artist.
But to get to that, the songwriter must pitch the song to the rest of the band and say, “Hey, I just wrote a new song. Let’s try it out.”
The band, at that point may say, “We’re not interested in any of your stuff,” or “Yeah, you always come up with good quality stuff, let’s try it again.” At that moment, the songwriter has taken off the songwriting “hat,” and put on the song plugging “hat” to pitch the song to the band to perform or record. Whether the songwriter is in the band or not, it doesn’t matter. They’re still pitching it to the band. That’s the job of a publisher. That song plugging hat is the publishing hat. Many songwriters are publishers and don’t even know it. They are in the publishing business when they pitch a song that they own and/or control.
By law, until and unless a songwriter assigns the publishing rights of their songs to someone else (i.e., a music publisher), that songwriter is his or her own music publisher. However, that does not mean that a songwriter is necessarily an effective music publisher.
Music publishing is hard, time-consuming work and not every songwriter wants to spend their creative energy chasing the pennies, as publishing is sometimes called. Just remember, these pennies turn into dollars in the long run.
A Publisher’s Job
Publishers need to create a demand for their songs. In other words, the publisher needs to have songs in their catalog of such quality that demand is unavoidable. If the songwriter-artist is in a band, they may pitching their song(s) to the band. They want them to play their song and to record their song. When doing this, the songwriter-artist is acting as a song-plugger. A song-plugger works for or with a publishing company. Perhaps, it the artist’s publishing company.
The copyrights owned and administered by publishing companies are one of the most important forms of intellectual property in the music industry. (The other valuable Intellectual Properties are the copyright on a master recording of the song which is typically owned by a record company, and the trademark which is owned by the artist.) Publishing companies play a central role in managing this vital asset.
Working with a Publisher
Content (songs) is the most valuable asset that an songwriter-artist owns, yet making money with songs, via publishing, may be the least understood. The moment an artist creates lyrics or melodies and writes down the music, the artist owns that composition–as soon as the pen writes a lyric or a note is played next to another to make a song. Many songwriters underestimate the value of their creative content and too often give away their publishing or license it too cheaply because they need money.
Music publishing is all you need to say to inspire groans of confusion or knowing smiles. Music publishing is tedious, detail oriented, and (some would say) boring; but it also happens to be the single most enduring source of income in this ever-changing entertainment industry.
Why is publishing considered the holy grail of income streams for a creator of songs?
A song copyright doesn’t just sit there and generate income – it needs to be promoted so that it will be used. Further, it must be protected against misuse. This is what music publishing is all about: The promotion and protection of – and if it’s done well – the profiting from copyrights. As previously discussed, content creation is the first part of Artist Development. Content protection is the second part.
So, if the artist-songwriter is the publisher or if the songs are licensed from the songwriter to a music publishing company, steps can be taken to ensure that copyrights are properly administered and exploited. This information is vital to everyone working in the music industry – after all, music publishing deals with the very basis of the music business: the songs. Without the songs, we might as well be selling shoes or shampoo. It is only by knowing exactly how music publishing works that a songwriter can become an effective publisher.
Speaking of which, who are these music publishers?
If the songwriter-artist is not prepared to make the investment of creating a staffed and fully-functional publishing branch, they will only do their song(s) a disservice. Music publishing requires expertise and extra amounts of patience. It’s also a whole different industry than that of writing, producing or promoting recordings. Prepare to hire the staff, do the legwork, and the complete all additional work. It essentially is a whole new business. Music publishing can be a great way to make a lot of money… after a while. If the artist is not willing, or wanting, to do their own publishing they should consider working with an established, reputable music publisher who they will work with the songwriter-artist to promote their copyrights. This may mean that the publisher will also promote the recordings those copyrights appear on and ultimately the artists themselves.
In the music industry, a music publisher (or publishing company) is responsible for ensuring the songwriters and composers receive payment when their compositions are used. 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. They also secure commissions for music and promote existing compositions to recording artists, record producers as well as music supervisors of film and television companies.
Whether the artist is a writer, a publisher or owns a record label – or all three – they should be aware of music publishing basics, and exactly how music publishing generates income. A dedicated songwriter should focus on the love of one’s craft, but there is no denying the income potential from publishing and songwriting is one of the highest in the music industry. Just because a songwriter can be their own publisher does not mean they are good at being a publisher. It’s a different “hat.” It is like starting a whole new business. Hey songwriters… are you ready to start working a new part-time job?
If the songwriter-artist wrote the songs and also does the pitching of those songs, then perhaps, they are also the publisher. If they signed a publishing deal, they are not the publisher. The party to whom they assigned the songs is now the publisher. Songwriting is competitive and signing a publishing contract could be a major deal. Songwriters who assign their music publishing to a music publisher might be giving up 50% of the total royalties, but in return may be getting a stable lifestyle as well as valuable experience with other staff writers. Collaborating on a song can be very educational. Some of the best songs ever written were done with other songwriters who bounced ideas around until something stuck. Publishers should encourage this because it affects their financial bottom line. Publishers pitch songs (as part of their catalog) to artists, producers, collaborators and companies. They ensure that all their songs have a registered copyright.
If you are a performer and wrote your single and have no publisher, THEN YOU ARE THE PUBLISHER! Yes, another “hat.” 100% of the royalties are 100% yours. To be fair, 50% of the total royalties is owned by the songwriter and 50% of the total royalties are owned by the publishing company. In the publishing industry this translates to: 100% of the songwriting royalties are owned by the songwriter and 100% of the publishing royalties are owned by the music publisher.
100% = 50% + 50%
Some songwriter-publishers setup an administration deal with a publisher. The artist-publisher still does the song-plugging but for 5% to 25% of the royalties are paid to administer the royalties and payments.
In addition, there are co-publishing deals where the songwriter-publisher collaborates with a music publisher and publishing royalties are split 50/50 (but can vary). If this turns out to be the case, the songwriter-royalties are still 100% but the publishing royalties are split leaving you (the songwriter and the owner of your publishing company) with roughly 75% of total royalties.
100% = 50% + (25% + 25%)
Synchronization (or synch) – income from granting rights to use music in TV, movies, and commercials.
Grand (dramatic performance) rights – income from granting rights to perform music compositions publicly in a dramatic setting like a play, Broadway musical, or ballet.
Print -income from the sale of music in print (i.e. sheet music).
Foreign sources -self-explanatory and can be a godsend if for some reason you don’t do well on home soil.
Mechanicals – income from the duplication of phonorecords (physical copies) of recorded music.
Performance – income from the performance of music.
Grand Rights Royalties
Record companies pay the publisher mechanical royalties based on a license fee determined by the number of phonorecords manufactured. The publisher then pays the songwriter(s) their portion of the fee.
For example: A record company estimates that they will sell 1,000,000 units of a single song sound recording. These sales may come in the form of recordings on a compact disc, vinyl record or MP3 download. Using the current statutory rate of 9.1 cents for the mechanical royalty rate of a 5 minute song, the record company would pay the publisher $91,000 for a license to manufacture, duplicate or replicate 1,000,000 units of the song.
If the record company sells no recordings, the publisher owes them nothing. The song was recorded and the recording was mechanically duplicated.
The $91,000 received by the publisher for the mechanical royalty is 100% of the total royalty. The publisher will keep the publishing royalty and pay the songwriter(s) the songwriting royalty.
9.1 cents X 1,000,000 units = $91,000
50% for the publisher(s) = $45,500
50% for the songwriter(s) = $45,500
If the recording of the song is also a part of a record album, the record company would still pay 9.1 cents per duplication.
Let’s not forget Harry Fox Agency. For a fee, they administer much of the mechanical rights business. Record companies can license the music from the Harry Fox Organization who, in turn forward the money to the publisher. A huge plus with these guys is that they will audit record companies for suspicious bookkeeping. They take their fee from whatever they recover from the record company.
When a songwriter’s song is performed on a stage or performed as a recording in a restaurant or radio station or any other business, a royalty is paid to the songwriter for the use of that song. This is called a Performance Royalty.
Performance royalties are paid via licenses that are granted by Performance Rights Organizations (PRO) such as ASCAP (American Society of Composers, Authors and Publishers), BMI (Broadcast Music, Inc), and/or SESAC. These three organizations issue licenses for a fee to any person or business that uses music; either live or recorded. (More about PROs in a separate section of the Artist Development Plan)
This is how it works. A songwriter and a publisher join a Performing Rights Organization to avoid the problem of contacting every business who uses their song. Nightclubs, radio stations, restaurants and many other businesses pay a fee to a Performing Rights Organization for a license and permission to use songs in the course of doing their business. The fee varies by PRO, the size of the venue and by the amount of music the business uses.
These PROs track their members song’s on radio, TV, and other public places in the US to determine how much to pay individual songwriters and publishers. Performing Rights Organizations are businesses designed to represent songwriters and publishers and their right to be compensated for having their music performed in public. Songwriters and Publishers are paid a performance royalty for the right to use their song IF they (and the song) are registered with PRO. This means that if you, your publisher and your song are not registered with a Performance Rights Organizations, YOU WON’T GET PAID ANY PERFORMANCE ROYALTIES!
Each Performing Rights Organization uses their own “mysterious” formula to come up with the payout to their members. Again, this gets paid as a 50/50 split to publisher/writer (unless some deal was made and publisher gets more).
A music synchronization license, or “sync” for short, is a license granted by the holder of the copyright of a particular composition allowing the licensee to “sync” music with some kind of visual media output (film, television shows, advertisements, video games, accompanying website music, movie trailers, etc.).
The rights to a composition or the “song”, which is different from the studio sound recording, are most often administered by the publishing company that represents the songwriter.
The value in the copyright of a song recording is divided into two pieces:
- the composition, which is the underlying lyrics and melody written by the songwriter and administered by the music publisher.
- the “master” sound recording, which is the actual studio recording of the song and most often owned by a record label.
When an audio/visual project producer wants to use a recording of a song in their work, they must contact both the owner of the composition (songwriter via publishing company) as well as the owner of the sound recording (record label). In many cases, video producers choose to use their own audio recording version of a particular song. In this case they would only pay the publisher for the use of the song and not the record company because they are not using the recording owned by the record company
Once the producer has made an inquiry with the copyright administrator (and additionally the record label if they choose to use their recording, the rights holder/administrator issues a quote, usually for a one-time fee. This can initiate negotiations, whose points of interest usually include things like how the work is being used, the length of the segment, the prominence of the cue (is it background music, or used as the title track during the credits), and the overall popularity and importance of the song/recording. Sync licensing fees can range anywhere from free, to a few hundred dollars, to tens of thousands of dollars for popular recordings of songs.
Print Royalties are paid from a music publisher to a songwriter for printing a song, or its download, (a song sheet, fake sheet, lyrics or music).
The royalty payment is made by the publisher and corresponds to the agreement (license) between the songwriter and the music publisher as with other music royalties.
If the writer’s work is only part of a publication, then the royalty paid is pro-rata, a facet which is more often met in a book of lyrics or in a book of hymns and sometimes in an anthology.
Church music – that is, music that is based on written work – is important particularly in the Americas and in some other countries of Europe. Examples are hymns, anthems and songbooks. Unlike novels and plays, hymns are sung with regularity. Very often, the hymns and songs are sung from lyrics in a book, or more common nowadays, from the work projected on computer screen. In the US, the Christian Copyright Licensing Incorporated is the collection agency for royalties but song or hymn writers have to be registered with them and the songs identified.
Grand Rights Royalties
If a song is used is a theatrical play, it might be dramatized. The right to dramatize is a separate right – known as a grand right. This income is once again shared by the publisher and the songwriter(s). There is no convention to the amount of royalties paid for grand rights and it is freely negotiated between the publisher and the director of the play.
Viewed from a US perspective, foreign publishing involves two basic types of publishing – sub-publishing and co-publishing occurrences in one or more territories outside that of basic origin. Sub-publishing, itself, is one of two forms: sub-publishers who merely license out the original work or those which make and sell the products which are the subject of the license, such as print books and records (with local artists performing the work).
Sub-publishers who produce and market a product retain 10–15% of the marked retail price and remit the balance to the main publisher with whom they have the copyright license. Those sub-publishers who merely license out the work earn between 15–25%.
SoundExchange is a non-profit company and function very much like a Performance Rights Organization in that collects royalties on the behalf of sound recording copyright owners and featured artists for non-interactive digital transmissions, including satellite and Internet radio.
As a part of the Artist Development Plan, prepare for licensing of songs and licensing of recordings of songs. Licenses are legal agreements between two or more parties expressly giving permission to use a song (or recording of a song) on a compact disc, television program, theatrical play, nightclub, ringtone, computer game or even music-on-hold while on the telephone.
All the terms and conditions for use (especially how much is paid) are spelled out when a license is issued.
(Sample publishing contracts and agreements are located in the forms section of this book.)
Pitching Music Publishers
- Do not flood a Publisher with songs. Sending a CD or ten-song tape, without suggesting one or two specific tracks will probably result in getting none of your tunes heard. Forget sending reviews, pictures, or other promotional materials. Send a professionally mastered, high bias or chrome tape (or CD), with a typewritten lyric sheet, and ALL your information on the tape and the lyric sheet. Do yourself a favor and send no more than two songs at a time. If a Publisher sees a tape with 8 songs, and a tape with 2 songs, chances are the 2-song tape gets listened to first. (It’s off the desk more quickly that way.) The longer the pitch is, the longer it takes to get around to plowing through it.
- TARGET!! The most difficult part of Publishing is finding the perfect place to pitch a song. When you send a song for Publishing consideration, try to name a few acts or artists who you feel the song fits. Be sure that these artists do NOT write their own material, and that the song fits musically, subject-wise, stance wise with the latest work by the Artist. You can write a GREAT song…but if it is not in the style being used today, your chances of a cut are slim. If you are pitching for TV or Film usage, try to remember that 90% of those songs are genre specific! I.E., if it’s a Country Song, they usually would like to hear fiddles or steel or both, so there is no doubt about the feel of the scene. In a Biker Bar, they might want songs with heavy guitar leads- but when pitching material for records, it is the quality of the WRITING more than the flavor or production.
- Be educated. Make sure you know what you are trying to do. Are you a songwriter? Are you a singer? Are you a singer who writes? Are you a songwriter who is also a performing artist? All these paths are different. Most Publishers work with dedicated songwriters as a first choice, simply because it is not a Publisher’s job to find a home for an Artist… their job is to find a place for the Song
- Be educated. Find out how you collect money earned from writing. (Royalties.) You must know the common terms to communicate intelligently. Use the Web. The Performing Rights Organizations (such as ASCAP and BMI) collect your Performance Royalties (basically, in the U.S., money earned from airplay,) and Harry Fox Agency sets the Standard Rate for record royalty payments. You also need to know about ppls, Synch Rights, Master Use Licenses, etc. There are excellent resource materials in book form and on the Web, and most cities have great songwriting organizations to guide you (Songwriters Guild of America, National Academy of Songwriters, etc.).
- Be educated. Songwriting is like any other skilled profession. There are rules and tools. It’s always ok to challenge or break the rules… as long as it is by choice, and not by ignorance. Study the craft of songwriting. Use tight rhyming where you can. Make your form consistent. Be creative. Be familiar with the work of who it is you are trying to pitch. Why should anyone cut your song if you don’t even know his or her work? Listen to the radio for what’s happening in your genre NOW.
HINT: A songwriter’s competition is not the bad stuff you hear… it is the BEST of the BEST.
Other than talent, songs are the most valuable assets that songwriter-artists own.
Publishing is probably the least understood area of the music business.