Music Publishing Agreements
What is music publishing?
Each individual track on your MP3 player includes the following three legal rights:-
1. The copyright in the sound recording itself. This is usually owned by the record label, i.e. the entity that paid for the recording or otherwise made arrangements for the sound recording session; and
2. The copyright in the underlying composition. The composer who wrote the music and lyrics for the song itself owns this. This is also known as the publishing right – i.e. the composer has the right to publish his songs and receive the income derived from the use of his compositions.
3. Rights to publically perform the track. Anyone looking to exploit recordings - including selling or hiring them, or showing or playing recordings in public – requires the consent from the perfomers of those recordings.
The composer is not always the same person as the recording artist. Many famous performers as well as new bands starting out do not write their own material. It is not uncommon for the writer and the performer to be two different people or more usually they are a group of collaborators.
The composer’s copyright gives him the exclusive right to adapt and exploit his compositions. He can grant rights to others to perform, manufacture and distribute records embodying recordings of his compositions to third parties. Often these publishing rights are assigned to a publishing company who will control them on behalf of the composer for a specified term, subject to taking a cut of the publishing income.
How is money made from publishing music?
• From the so-called ‘mechanical’ income that is payable by a record label for each recording manufactured and sold. The Mechanical Copyright Protection Society here in the UK, now part of the Performing Right Society (‘PRS’) collects this income.
• From the performance licence fee payable each time the song is played publicly such as on the radio or TV or in pubs and clubs; the PRS collects this income.
• From the ‘‘synchronisation’’ fee payable when a composition is included on the sound track of a film, TV advertisement or in video games;
• When printed written copies of the composition are sold or if lyrics are reproduced in a newspaper or magazine or other format;
• From the grand rights if the composition is used as part of a musical production in a theatre.
Where a songwriter assigns rights in his compositions to a music publishing company, the music publisher will collect the publishing income from the above sources. This is not always as easy as it sounds as it may be impossible to know at any given time what compositions are being performed or used all over the world.
Collection societies including the PRS collect publishing income, however a small publishing company based here in the UK might find it difficult to recover income that is due from a territory overseas. Some smaller publishing companies will therefore appoint sub-publisher’s overseas to help them collect and administer a composer’s catalogue of works worldwide.
A good publishing deal:-
What is good for one composer is not necessarily good for another. For a composer with a huge catalogue of works, he may only require help with administration, whereas a new pop band might want their publishing company’s sync team to actively promote their compositions through their connections with film companies and advertising agencies.
Similarly, a small UK-based publishing company might work harder at promoting works, whereas a major music publisher may not need to do this because they are busy looking after very famous compositions, which get used week after week in film and on TV and recorded by lots of different performing artists.
Some key provisions in a publishing agreement include:-
• Term – this should be limited to between 3 to 5 years. Options to extend the term should only be exercisable by the publisher if further advances are paid to the writer and subject always to the publisher having complied with all their obligations in the agreement.
• Royalties – a deal where the mechanical splits are more than 70/30 in the writer’s favour is fair where the publisher is working hard to exploit works. However, for a purely administrative deal where income is just collected as opposed to works being actively promoted, higher splits of 90/10 in the writer’s favour are not uncommon.
• Accounting – ‘at source’ accounting is best for the composer. This means that income from overseas is not subject to any further deductions payable to any sub-publisher in that foreign territory. If a sub-publisher does deduct their cut from such funds before the money is transferred to the UK-based publishing company, this means the composer will end up receiving less, after his UK publisher has taken its cut. This position is also known as a receipt’s deal. A composer might however be happy with this arrangement where the publishing company is able to significantly increase the amount of income through sync use in films or in advertising.
• Assignment and reassignment – the publisher will require the writer to assign his rights in the compositions during the term, with a further right to collect income after the term has expired for another 10 to 20 years. Where a piece of work is not exploited by the publisher the writer should be given the right in the agreement to have this work re-assigned to him for 3rd party exploitation.
Contact us
Chris Phillips and Mike Shepherd who head up the Media and Entertainment department here at Bolt Burdon are experienced lawyers used to negotiating and advising on all types of music industry agreements.
To find out more about our charges to prepare or negotiate your music publishing agreements, or for any other advice about music publishing please contact us on 020 7288 4700.