The Money Is In Music Publishing

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Music Publishing 101

Music publishing remains one of the most financially lucrative areas in the music business.” The Music Publishing Industry raked in $4.9 billion in revenue in 2011 according to the IBISworld Market Research Report.

For the most part Music publishing is governed by U.S. copyright law.
You actually own the copywrite of a song once you write it. But, it’s important that you register the song with the Library of Congress as proof.

Register your music the proper way with the U.S Copyright Office using either form PA or SR. Log on to www.Copyright.Gov

Music publishing is the business of turning songs into something that earns money. So if you want to earn money from your songs and tracks, you have no choice but to take on that role of the music publisher. Songwriting and producing is the act of creating the music. Publishing is the act of looking at that musical creation and thinking of the various revenue outlets for it.

As a Songwriter or producer, you have to try to figure out where your music fits and where you will be able to place your music to earn revenue. In some cases the songwriter and artist or performer of a song are not the same person. So, Understand that there are royalties paid to the Songwriter and Royalties paid to the artist. Publishing is concerned with the royalties paid to the SONGWRITER and not the artist or performer.

As a songwriter or producer, you can earn money by licensing your songs and music for various uses, and collecting the corresponding licensing income or royalties. If Rap Music Songwriters and producers understood the importance of publishing and copyright ownership, they would not be giving their music away for free so easily.

The song “Happy Birthday To You” which is owned by Warner Chapell Publishing generates about $5000 per day ($2 million per year) in publishing royalties. The company insists that one cannot sing the “Happy Birthday to You” lyrics for profit without paying royalties. This includes use in film, television, radio, anywhere open to the public, or even among a group where a substantial number of those in attendance are not family or friends of whoever is performing the song.

Singer/Songwriter The Dream stated that he earned about $15 Million in publishing royalties for writing the song “Umbrella” for Rihanna. Did You Know That Singer/Producer Bruce Hornsby owns 75% of Tupac’s Song “Changes” due to the sampling of Hornsby’s composition with in the song. Hornsby has made millions from the song.

It has been rumored that 50 cent was able to purchase his Connecticut mansion off of one publishing check from his song “In Da Club.” Your music catalogue is an ASSET and has revenue generating potential.

The most important thing a songwriter or producer can do, is to learn to be active in exploiting (placements,etc) their own music for profit via licensing and other means. The goal is to get your music in situations where you can start making money.

Thousands of song writers and producers are generating great income from music licensing and so can you. (Monetize Your Movement)
There has been a growth in media on a worldwide basis. There are literally hundreds of hundreds of additional TV stations now than there were 10 years ago. All of these stations have shows that need music. Satellite radio continues to grow, and you hear more and more songs in advertising, video games, and ring tones.

Music Publishing is where the money is in the music business.
The most significant revenue for a songwriter comes from issuing Mechanical, Performing Rights, Synchronization, Print (Sheet Music) and Foreign Licenses.

Songs generate money for the writer when it appears on an album, gets played on the radio, used in a TV show or movie, or sold as sheet music. There are two halves in every publishing dollar. One of the halves is the “Writer’s Share,” and the other half is the “Publisher’s Share’.”
And you the songwriter own the publisher’s half as well, unless you sign a publishing or co-publishing deal with another company. Songwriters some times sign with a music publisher who will pitch the songs to record companies, TV shows, movies, commercials etc. on their behalf.

MECHANICAL ROYALTIES

Mechanical licensing is the licensing of copyrighted musical compositions for use on CDs, records, tapes and certain digital formats. The Harry Fox Agency was established as an agency to license, collect, and distribute royalties on behalf of musical copyright owners.

A song writer is entitled to receive a compulsory mechanical license fee when ever his/her song is used in a mechanized fashion. (Meaning when ever it is manufactured and sold by a record label.)
Record labels actually license songs from songwriters in order to sell them and make a profit for themselves. In return they have to pay the songwriter a mechanical royalty for each song sold.
Mechanical Royalties are generated from album sales and digital download sales.
Mechanical royalties are paid by the major record or indie company to the songwriter or publisher of the song through the Harry Fox Agency.

The Mechanical royalty rate (Also Known as the “Statutory Mechanical rate”) is set by congress and is currently set at $.091 (9.1 cents) per unit sold. Hence, technically and hypothetically, If you had one song that was written and published solely by you on a million selling album, you would earn $91,000 in mechanical royalties.

If you’re signed to a record label and the label releases and sells a song that you are both the writer of and the artist performing on it, then you will receive both a mechanical royalty and an artist royalty from the record label.

PERFORMANCE ROYALTIES

Another lucrative part of music publishing involves Performance (Broadcast) Royalties.
Performance (Broadcast) royalties are paid when a song is played on the radio, used by businesses for background music, used by clubs, etc. A popular song can earn thousands and sometimes millions of dollars for the songwriter through the collection of performance royalties.

Whitney Houston’s version of “I Will Always Love You” was a mega hit. But. the person who truly made money off of it was songwriter Dolly Parton. Publishers and songwriters register with performing rights organizations like ASCAP, BMI & SESAC to collect Performance fees on their behalf.

Performance royalties are collected from radio and TV broadcasters, etc. by the Performing rights organizations ASCAP, BMI, or SESAC. The Performance Rights Organizations negotiate blanket licenses with all those who use music for profit on radio, TV, commercials, in clubs, etc
Performance Rights Organizations monitor radio and television broadcasts and pay publishers and songwriters based on projected uses of a song. Performance royalties pertain to the money songwriters earn from radio airplay, television, jukeboxes, music services and live performances.

SYNCHRONIZATION LICENSES

Synchronization Licenses are licenses issued to have Music used in film, television, commercials, music videos, etc.

A songwriter earns money from songs placed in TV or Film from the Synch licensing fee paid up front.
Thus Synchronization license fees and royalties are generated by songwriters by licensing their songs to be used in TV, Films, commercials.

Synch typically means licensing the right to record the music or songs in synch with the pictures of film or TV movies, ,etc. The songwriter and publisher are paid a negotiated fee to use the song in the movie..
The Synch license fee is determined by the overall music budget a music supervisor has to work with and the negotiating power of the artist.

A prime-time network TV show might pay a license of $1000 – $8000 for an unknown artist or songwriter. Major studio pictures pay well-known artists in the tens of thousands of dollars for use of their songs in a movie. Songwriters with songs on a particular TV Show generate new royalties every time the TV show is re-run or goes into syndication.

Please Note that a sync license gives the license holder the right to only RE-RECORD a song for use in a media project. A master license gives the license holder the right to use a pre-existing recording of that song in a media project.

It’s important to understand the difference between a synch license and a master license if you’re trying to get your songs in film or TV. A master license is obtained from the person who owns the recording (in other words, owns the master). Often times master licenses are obtained from the record labels.

FOREIGN MUSIC LICENSING

Songwriters can also enter into a foreign music licensing agreement with a foreign record company and earn revenue. With a foreign music licensing agreement you authorize a foreign record company to duplicate and sell copies of existing masters.

A song writer can earn foreign royalties as a result of entering into a foreign licensing agreement with an overseas record company.

VIDEO GAME LICENSING & PLACEMENT

Equally important, Songwriters and producers can generate revenue by licensing their music to be placed in video games. When submitting your music to video game developers directly, remember that certain games require certain types of music to compliment the action on screen.

Try to find out exactly what mood the developer is looking for, and what games they are working on, before submitting your music. The role of your music is to enhance the gamer’s experience while they interact with the art on screen; it’s not supposed to take center stage.

The more your intention lay in assisting the overall artistic vision of the project, and not so much on just landing a placement, the more likely the video game music supervisors will want to work with you.
If you are interested in getting your music in video games, then it’s wise to attend video game developer conventions and network with the developers; find out who are the music directors.

So as you can see, songwriters can generate huge amounts of revenue.
Additionally, please note that songwriters can generate revenue from having their songs converted into Sheet Music as well. To sum up, songwriters can license their music and earn Mechanical Royalties (album sales & digital downloads), Performance Royalties (radio play) and Sync Royalties (licensing to TV, Films, commercials) Reach out to the music supervisors of MTV, BET and VH1 and send them songs or beats for their various programs.Reach out to the music supervisors of ESPN or other sports networks and send them songs or tracks for their programs. Try to get your music placed in video games.
It’s imperative for artists, producers and song writers to attend different conferences, seminars and workshops to build their network.
In this digital age it’s imperative that artists and producers join Sound Exchange (www.SoundExchange.com ) More importantly, the home boy way of doing things will not suffice in today’s music industry. Always utilize split sheets when collaborating on a song. A split sheet reveals the split of the ownership in a particular song.
A songwriter usually owns 100% of the underlying composition (e.g., the lyrics and/or musical arrangement), unless he/she co-wrote the song with another individual and/or gave a portion of the ownership away through an agreement with a third party.
In conclusion, The music business is changing but the constant will be PUBLISHING. Even if CD’s go completely away, there will still be mechanical, Synchronization and performance royalties.
The goal is to construct an infrastructure, a team and strategy to build a long lasting music career. The mission is to become a professional or “working musician, artist or songwriter.”
Written By Jesse Atkinson, CEO of Urban Threshold Inc. and Founder of The A&R Power Summit www.TheARPowerSummit.com and The Underground Music Awards www.UndergroundMusicAwards.com