Understand key words and their definitions as they are used in the music business.
Publisher: administrator of a song's copyright; collects and distributes royalties.
Royalty: income derived from songs and/or sound recordings from various sources.
Copyright: protection of an original, tangible work for a limited duration.
Share: portion of ownership of a particular song or work.
Advance: monetary amount paid upfront on a publishing contract.
Recognize rights and limitations of song owners and how they work within the music industry.
A copyright is the songwriter's exclusive right to copy his or her creative work. Basically, you have a monopoly of limited duration. Copyright is simple. As soon as you have something tangible, written or recorded, you have the copyright. Additionally, as soon as you have the copyright, technically you are the publisher. You don't have to register your copyright, but doing so entitles you to certain exclusive rights, which means no one can do those things without your permission. These rights are: the right to reproduce the work, right to distribute copies, right to perform publicly, and the right to create derivatives. Registration can be done on your own through the United States Copyright Office at copyright.gov.
Although it is possible to be your own publisher, many artists find it easier or prefer to sign a publishing agreement or pay someone a flat fee to be the administrator of the songs. The music publishing agreement, or "publishing deal", is an agreement between the songwriter (the owner of the copyright) and the music publisher (who seeks to own or rent the songs).A publisher is responsible for administering the work by finding users, issuing licenses, collecting money and paying the writer.
Grasp the publishing agreement basics.
A trade-off for signing a publishing deal is that the publisher's share of the royalty income is usually half. This is known as the "publisher's share" while the songwriter retains the other half, the "writer's share". This is the most popular kind of publishing deal signed. Here are some of the other issues that are covered in most publishing agreements:
1. Term: can be based on a calendar year or by albums
2. Territory: usually worldwide in order to maximize publisher's earnings
3. Advances: advances are usually "nonrefundable and recoupable." "Recoupable" means if the writer's songs generates sufficient royalties to pay back the advance, the publisher gets to "recoup" its advance.
4. Royalties: in a traditional co-publishing deal, the publisher will be paid 50 percent of all royalty income.
5. Ownership: under a typical deal, the writer becomes a co-publisher with the music publisher on a 50/50 split, but the publisher has exclusive administration of the songs. Similarly, under the typical co-publishing deal, there is usually a 50/50 split, which becomes a "75/25 deal." This means the co-publisher-writer gets 100 percent of the writer's share of income and 50 percent of the publisher's share--or 75 percent of all income.
6. Costs: costs are generally deducted from gross receipts. Litigation costs will often included in a "Warranties" or "Representations" clause whereby the writer swears that the work is original. Publishers seek indemnification for any subsequent litigation and see that the writer absorbs those costs. This is an excellent area for negotiation.
Know the various sizes in publishers.
Just like record labels, music publishers come in many sizes. The largest and most prevalent are known as the majors. These are mostly affiliated with record companies and movie studios. Popular names include Warner, Universal and Sony/ATV. Majors certainly have the widest distribution and access, but smaller artists often are challenged in getting requisite attention. Next are independents. Sometimes indies are administered by a major but are mostly independently owned and operated. More can be learned about independents through the Association of Independent Music Publishers at aimp.org. Finally, you can be your own publisher and simply contract out the expenses of administration.