Licensing of music can be likened to the renting out of music like the way we borrow movies from the video club.
The songwriter/music publisher own the rights to the song but are lending it out to interested parties in the music for which the music publisher collects a license fee and royalties with respect to this music.
Below are the following ways and their explanations are below;
- Mechanical royalties
- Performance royalties
- Synchronization Licenses
- Sampling Licenses
- Print rights for sheet music
- Foreign Music Licensing
- Video Game Licensing and Placement
The following are ways by which a songwriter can make money from his or her song;
MECHANICAL ROYALTIESMechanical licensing is the licensing of copyrighted musical compositions for use on CDs, records, tapes and certain digital formats.
A song writer is entitled to receive a compulsory mechanical license fee when ever his/her song is used in a mechanized fashion.
This means that when a songwriter writes a song for a record label or an independent music artiste, the songwriter/publisher will collect an amount of money from one CD sold and from online downloads from streaming companies. This can be fixed at say, N50 for every CD sold and for every download on ITunes, Spotify, Yahoo music, etc.
Mechanical Royalties are generated from album sales and digital download sales.
For example, if an artiste manufactures 1,000 CDs and only 500 copies of the music CD is sold, the songwriter is entitled to a percentage of all the 1,000 copies of the CD. It does not matter if the music artiste sells everything or not.
This is how it is done in advanced countries where the actual number of CD sales or digital downloads is known.
In Nigeria where we do not have accurate statistics of album sales and digital downloads. So, a music publisher like me will collect a fixed amount of mechanical royalty up to about N5m (depending on the caliber of the musician; it could be more), the remaining will be collected in form of other types of royalties.
As a songwriter/publisher, you are owed a royalty whenever your compositions are performed “in public.” This includes:
- Song play on terrestrial radio
- Usage on network and cable TV
- Song play on online radio
A popular song can earn thousands and sometimes millions of Naira for the songwriter through the collection of performance royalties.
Performance royalties are collected from radio and TV broadcasters, etc. by the Performing Rights Organizations in Nigeria namely;
- The Copyright Society of Nigeria (COSON)
- The Musical Copyright Society of Nigeria (MCSN)
These 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/songwriters based on projected uses of a song.
Performance royalties pertain to the money songwriters earn from radio airplay, television, music services and live performances.
SYNCHRONIZATION LICENSCESSynchronization 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 by the film maker or executive producer.
These Synchronization license fees and royalties are generated by songwriters by licensing their songs to be used in TV, Films, commercials, etc.
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/publisher is paid a negotiated fee to use the song in the movie.
Note that a sync license gives the license holder the right to only RE-RECORD a song for use in a media project.
For example, if the song will be sung by one of the characters (actor/actress) in a film, a sync license will be issued.
For example, If Spiff in the sit-com, The Johnsons, sings Yemi Alade’s Johnny, a synch license will be issued by the music publisher to Africa Magic.
A master license gives the license holder the right to use a pre-existing recording of that song in a media project. This means that a song will be used in a film exactly the way it was sung by the music performer and a master license will be issued to the executive film producer. This type of license costs more.
For example, if Wiz Kid’s Ojuelegba is played in a party scene in a movie/drama, etc, a master license is issued by the music publisher to the producer of that film.
It is important to understand the difference between and a master license and a synch 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 time master licenses are obtained from the record labels.
SAMPLING LICENSESIf someone wants to use a drumbeat, sound bite or any other portion of a song you have written and recorded, they must first get your permission and then also pay you royalties for its use.
Both copyright holders (the owner of the master recording and the songwriter/publisher) are owed money when an artiste uses a sample from another artiste’s original work.
For example, before I produced the sample of Oritsefemi's Double Wahala, I sought permission from him via his manager.
Assuming that I was able to promote that song at that time and it was played on the radio several times and the video of the same song was played on TV, COSON or MSCN will collect royalties from the radio, TV and other performance venues and give the royalties made from this song to Ortisefemi.
If we listen to this song carefully, we will know that Double Wahala is not Oritsefemi's orignal composition. he sampled Fela Anikulapo's Double Wahala song even though he added his own lyrics too.
So, for a proper splitting of the royalties from the Double Wahala song, Fela Anikulapo's estate will receive half of the royalties from this song.
I will not receive any royalty from this song because I did not add any significant part to the song. I simply copied the lyrics with my talking drum.
This is how the sampling license works.
PRINT RIGHTS FOR SHEET MUSICAs the songwriter/publisher, you are paid whenever your composition is duplicated in print form, including sheet music, lead sheets, books, etc.
FOREIGN MUSIC LICENSINGSongwriters/ Publishers can also enter into a foreign music licensing agreement with a foreign record company and earn revenue.
With a foreign agreement, you authorize a foreign record company to duplicate and sell copies of existing masters.
A songwriter can earn foreign royalties as a result of entering into a foreign licensing agreement with an overseas record company or music publishing company.
VIDEO GAME LICENSING & PLACEMENTEqually 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.
Songwriters can make money from ringtones. Ringtones are provided by tele-communication company. You can negotiate with them to have your song used as a ringtone or have a music publisher represent you.
I am musically yours,