The Insider's Guide to Music Licensing

Brian Tarquin

• Publisher: Allworth
• Year: 2014
• ISBN:
  9781621534075
• Topic: Médias et arts de la scène
• Subtopic: Musique et affaires

First-hand advice for musicians from Brian Tarquin, author, who has over twenty years of experience in licensing music to record labels, TV shows, feature films, radio promos, and network promos. This book takes you through how licensing really works: what type of royalties are expected, digital royalties from companies, receiving royalties from iTunes, Rhapsody, Napster through digital distributors like IODA/The Orchard, and how they pay. Also covered are mechanical royalties from broadcast radio licenses, how foreign royalties are collected, publishing administration deals, and a breakdown of sync and master licenses. Interviews with major industry players offer advice directly to musicians.Allworth Press, an imprint of Skyhorse Publishing, publishes a broad range of books on the visual and performing arts, with emphasis on the business of art. Our titles cover subjects such as graphic design, theater, branding, fine art, photography, interior design, writing, acting, film, how to start careers, business and legal forms, business practices, and more. While we don't aspire to publish a New York Times bestseller or a national bestseller, we are deeply committed to quality books that help creative professionals succeed and thrive. We often publish in areas overlooked by other publishers and welcome the author whose expertise can help our audience of readers.

Chapter 1

Introduction to Music Licensing—The Basics

The age-old question always seems to be, “How do I get my song placed on a TV show?” As you can guess, it is certainly not as easy as it looks. There is a lot of legwork, phone calls, research, and of course that certain “right timing factor.”

Just because a show played a dance vocal song in a scene, does not mean that your dance vocal song will be played on the same show the following week. This might have been a rare situation that called for that particular style and may not be a reoccurring style in the next upcoming episodes. There are so many factors involved with music licensing, most importantly, building your relationships with music supervisors, editors, and television music licensing departments.

When I started in the late ‘80s it was much more of an open field for licensing music to TV and film, whereas, today, it is a lot more competitive out there on the street. The proverbial “best kept secret” on actually making income on your music isn’t a secret anymore. Hence, through the years I’ve seen both sync and master fees (“sync” refers to the publishing side of a song, and “master” means the actual audio recording of a song) and the amount that PROs (Performance Royalty Organizations), like SESAC, ASCAP, and BMI, pay, go down.

As more people get into the game, the pot remains the same, so obviously with more people the supply is greater. In turn, license fees become smaller, as do performance royalties, which is good for the shows licensing the music because it makes the fees cheaper. Then there are your newcomers on the scene that offer their music for free, no sync and master fees, which can be very bad for the rest of us. As the old saying goes, “Why buy the cow, when you can get the milk for free?” Well this can easily pertain to many business models that people are using today, just out of sheer ignorance.

For instance, the Discovery Channel uses this model and insists on taking 25 percent of the publisher side of any catalog they license. Unfortunately, people jump into the pool before they realize there is no water in it! Novices think this is a surefire deal and that they will make tons of money from the back-end writer performances. Well I hate to break it to you, but the Discovery Channel performance royalties equal pennies on the dollar; absolutely laughable.

SYNC AND MASTER FEES

So let’s recap this deal. You give up sync and master fees and 25 percent of your publishing just to get airplay on a channel that pays pennies for your song for a term of in perpetuity. This is because each broadcast license a network has with a PRO varies a great deal. The license fee paid to a PRO by the Discovery Channel is a fraction of what ABC-TV pays to the PRO. Why? Because these fees are measured by the size of the broadcast and the viewership is measured by the Neilsen ratings. Hence large networks such as CBS, ABC, and NBC, which have the largest numbers of viewers, have the most expensive airtime, so it’s only natural they will pay the most into the pot. Cable channels like Discovery, Animal Planet, and the History Channel may only air in certain parts of the country, therefore their distribution is not as strong as the networks.

The other factor in all of this is how each of the PROs pay, and this varies during different parts of the viewing day. So when ABC-TV pays the licensee fee to each of the PROs, it is in a lump sum. They don’t break it down by paying fees for each show they air; this is up to the PROs to do for their affiliates. Generally, the highest paying time is primetime, as opposed to daytime and overnight.

For example, SESAC uses the following “Royalty Formulas”:

Station Count multiplied by Use Type Weight, multiplied by Duration, multiplied by Time of Day Weight, multiplied by Affiliate Share, equals Credits.

	Station Count
	Use Type Weight
	Duration
	Time of Day Weight
×	Affiliate Share

=

Credits

Television License Fees Available for Distribution divided by Total Credits, equals Value Factor.

	Television License Fee
÷	Total Credits

=	Value Factor

Credits multiplied by Value Factor, equals Royalty Payment.

	Credits
×	Value Factor

=	Royalty Payment

Now back to our Discovery example, their rates are so low because the license fees they pay to the PROs are so low. Now if you did the same deal with a major network, the back-end monies would be greater. Still, I have to say the whole idea of giving away 25 percent of your publishing just to have them use your music really does not sit well with me. What’s next? Pay the channel to play your music? But as we all know there is always someone out there who will do this deal.

Another broadcast company to be aware of is ESPN because they do not pay broadcast licenses to PROs, and somehow they get away with it! They do what are called “direct licenses” with music libraries and suppliers, which is a terrible practice because it lowers the value of music, and many libraries don’t pass on the writers’ shares to the composers. If you compose for them, they are essentially buying your writers’ and publishers’ performances with a one-time, work-for-hire fee with no residuals on the back-end. ESPN is owned by ABC-TV, the parent company of which is Disney, and surprisingly, they get away with not paying a license to SESAC, ASCAP, or BMI.

For twenty years I’ve been trying to find a definitive answer for how they can get away with this without being taken to court by the PROs, considering all of the music they play on their shows. The only answer I ever seem to get is that shrewd lawyers run ESPN and they have found a loophole. Again, no one stands up to them, not even the large music libraries or publishers that have leverage.

With this all being said, I do understand why certain people do gratis deals (waiving sync/master fees) if they are starting out in the business and need to build up a credit list. This is why music libraries are a good option for composers starting out. Good reputable libraries will split any sync/master fees with you, and although you give up your publisher performance royalties, you retain your writer’s, and in some cases the underlying copyrights. I always encourage composers to contact shows directly and suggest “work-for-hire” compositions. This is a very good way to build your chops, credits, and relationships. In the beginning of my career this is how I started out, because of which, to this day, I have maintained many of the same relationships.

INDUSTRY RESOURCES

There are many shows that look for talent to keep their shows fresh, and with all of the reference guides and Internet sites, it is easier than ever to find information. Back in the day, I had to actually watch the shows and record them on VHS—slow down the ending credits to see who was licensing music for the shows. There are some great resources out there, the Hollywood Reporter, Music Connection magazine, and one of the most specific for the field, the Music Registry, run by Ritch Esra. The Music Registry publishes guides such as Film & Television Music Guide, A&R Registry, and the Publisher Registry, all of which are updated a few times a year. However, the Film & Television Music Guide is particularly good, listing actual music personnel from television networks, music supervisors, music editors, video game companies, and trailer houses from around the country. It lists specific music titles and contact information, including email addresses. It is a very resource-filled guide.

I remember back in the early ‘90s seeing an advertisement in the back of the Hollywood Reporter, in the classified section, for a small music placement company called Red Engine Music. I sent over some of my songs, and the owner, Marc Ferrari, former guitarist from the hair band Keel, contacted me and added my songs to his library. So started my longtime friendship with Marc and we have helped each other out ever since. Marc turned that library into MasterSource, which focused on vocal tracks and filled a much-needed niche in the marketplace.

Before that time no other music libraries were producing vocals, which forced productions to go to large publishers to license such music. Marc was ahead of the curve and realized the value of supplying vocals to the film and TV community at a cheaper price than what the major publishers were asking. So it’s no wonder he went on to sell MasterSource to Universal Publishing years later for several million dollars. This story alone should be inspiration enough that it is possible to be very successful in the music licensing business.

The resources and the need for music are there; it’s up to you to hustle your songs and get them placed, and hopefully this book will assist you.

Chapter 2

Music Production Libraries

A common question I am always asked is, “What is a music production library?” Well, I’m not going to bore you with a technical answer from Wikipedia, however I’ll explain it from my twenty years of experience composing for them. Simply, they are music companies, like FirstCom, Megatrax, Sonoton, and others who hire composers to produce affordable music for all sorts of broadcast and film productions. So if a show wants a pop-vocal song and can’t afford to license a track by Rihanna from Def Jam, they go to a place like Killer Tracks and license a sound-alike. Pretty straightforward and simple for productions because these libraries own both the masters and the syncs (publishing), so it’s a one-stop shop.

In the new millennium there has arisen a new business model for these libraries—at places like Crucial Music, Pump Audio, and Rumble Fish—where these companies aren’t hiring composers to build their catalog, but are instead licensing tracks from a plethora of musicians out there and offering the songs up for licensing. In the latter case, musicians can still own their own copyright and these deals are usually non-exclusive, because they either change the names of the songs or use specific codes in front of each song. See the Music Library Contract in Appendix C to better understand how this business model works.

The first music library model mentioned above is known as a work-for-hire deal, in which the library owns the copyright, masters, and publishing of the music composed or produced by the composer. See the sample work-for-hire contract at the end of this chapter. This has always been the most common way for libraries to do business because they control all aspects of the music, except the writer’s share. They become a one-stop shop where they license everything to a particular client so that the client doesn’t have to get separate approvals from various sources.

Licensing from record companies has always been a bump in the road for music supervisors, because the labels may only have control of the masters, leaving the supervisors to chase after the publishing side, commonly known as the sync side. In many cases, the sync could be split between various companies or artists stretching across the globe, making it very difficult to get approval from all parties in time to make the airdate of the broadcast. This is traditionally why music libraries came into existence, filling the void and need for music licensing in a timely manner. In turn, with such a service, the library can put itself at legal risk if the composer uses an uncleared sample, or copies another song or piece of music in the public domain without permission.

There is an additional form called a Certificate of Authorship that a composer has to sign along with any co-writers to assure the company that the music delivered is in fact original music. You can understand the company’s point of view, because the music can appear anywhere in broadcast and non-broadcast, making it essential to have music that is original, free and clear to lice...