This proposal sets a very dangerous precedent that would undermine songwriters’ ability to collect future royalties from their work.
What would these composers give up? Let’s talk about public performance royalties.
The right to publicly perform a work is embodied in US Copyright Law. (I’m going to stick the US, but this is closely paralleled in other countries.)
That means that if you are the owner of a copyrighted work, then the ability to perform that work is yours alone.
(For our purposes let’s consider that “musical work” to be a song.)
If you perform it, that’s totally fine: you are the owner and you have that right.
But what if somebody else wants to perform it?
If somebody else wants to perform it, they must get permission from you, the copyright owner.
But how do you even know when somebody else is performing your song? How can they be expected to find you and get permission?
That was the basis for the creation of performing rights organizations, or PROs.
When you sign up (or “affiliate”) with one of these PROs, you give them the ability to monitor uses of your music, issue licenses on your behalf, and collect the royalties that are due to you (and your publisher) as a result.
They also have the ability to enforce your rights with respect to public performances of your songs.
They primarily use five means to collect those royalties: 1) blanket licenses; 2) census-taking 3) surveys 4) cue sheets and 5) online reporting.
When a PRO issues a blanket license, they give permission to that venue and allow all the songs in their catalog to be performed in that venue for a fee. That fee is based on a bunch of factors, including the type of venue, its size, and how music is performed there.
The revenue collected is then split across all of the PROs members.
(Note: My understanding is that the revenue is actually split amongst the top grossing tours, so this is actually means that smaller / indie / DIY artists miss out. (And if you know more about this than I do, shoot me a dm because I want to learn more.)
Sorry for the delay...back at it!
Cue sheets are rhe primary way PROs track music used in Film and TV broadcasts. The production company is responsible for creating a cue sheet that lists all the music used in their picture or broadcast.
The PROs then use the cue sheet to make payments to their songwriter / publisher members.
A census is one-to-one tracking of a particular performance, whether the PRO compares a cue sheet to what a radio or TV station records in their programming log, or look at a printed program from a concert.
These represent what actually happened, and allow the PRO to pay their member accordingly. Contrast that with the next means...
Which is called a survey, and is a statistical extrapolation of data based on what radio or TV stations report having played. So imagine a station that reports having played a particular song on average three times a week for a month:
the PRO could then calculate the number times that same song got played over a quarter, or six months, or whatever period makes sense given their data. They would then collect royalties based on that statistically-arrived at result.
even if they are not amongst one of the top-grossing tours.
So this is increasingly important as the online tools are only relatively recent developments, and they offer an opportunity for artists to get paid when they otherwise might not.
So as with the rest of music publishing, the question of getting paid is highly complex, and the reason for working with a PRO (and a music publisher or administrator) is so that the songwriter has some piece of mind that they are not losing out on their royalties.
But there are ways to circumvent using a PRO: direct licenses and source licenses; as well as contracts that incorporate either buyouts or works-made-for-hire.
(Note I’m not an attorney; my knowledge is based on my own experience, learning, and teaching. If you are EVER asked to sign a contract, you should talk to an attorney about it.)
A direct license is between the copyright owner and the entity that wants to perform the work, essentially skipping or cutting out the PRO.
(I’ve seen these most with mechanical licensing, where publishers will handle their own mechanical licensing because they can save the money they’d otherwise pay to a collection society—like the Harry Fox Agency—to do it for them.)
In the case of the PROs, direct licenses can cause you to lose the benefits of scale the a PRO would bring, including their ability to audit, their ability to answer questions, etc., making it harder for you to administer your rights.
With a source deal, you grant the rights to the production entity to license the works on your behalf, in essence giving them the same abilities that a PRO might have.
So in the article that got this going, a production company offering direct / source licensing deals is taking your PRO out of the loop, and in doing so limiting the amount of money you can make (by keeping you from earning royalties that the PRO might’ve been able to collect),
and by removing that PRO from the licensing process for the compositions involved, thereby preventing them from licensing those works on your behalf.
As for buyouts / works-for-hire: these are common practices that companies use, but they are not interchangeable. That said, my experience is that they are always negotiable, so definitely use your attorney and negotiate.
These deals can be advantageous for the creator, especially if the licensee is willing to pay upfront and it’s unclear what the potential upside may be.
A big difference is that a WFH means you never own the copyright. You got asked to create something on the basis that you would never own it, as if the company you made it for created it themselves. (There are specific definitions of what makes a WFH in the US Copyright Act.)
Film and TV companies like to do this because it means they never have to re-clear the work (because they own it).
Buyouts are different mostly because you as the creator owned the copyright prior to the buyout. They are also different because they might not include a transfer of ownership at all.
In the first case, the buyout might be called a copyright “assignment” which provides you give up your ownership (note the terms are negotiable); in the second it might mean you keep ownership but that you give up the right to receive future royalty payments.
(Note that I’ve done WFH deals where the composer retains the writer’s share of public performance. You just have to ask.)
So back to the original article about Discovery UK (as well as the recent one about Netflix here: bit.ly/2Ekp0N0),
I have not seen the deals, but I know they if it is true that the production entities are looking to take away composers’ and songwriters’ rights, then they are going to get themselves into a big fight.
Such an effort in the part of the networks / production entities would set a dangerous precedent.
However, everything is negotiable, but negotiation is about leverage, and it is easy for a big company to push around a young composer looking to get their foot in the door. That is the real danger here: people unwilling to assert their rights.
So if somebody puts a deal in front of you and tells you to sign it, don’t.
Every deal can be negotiated, and each should reflect terms you understand and agree to, especially if there are trade offs to make.
So call your manager or call your attorney. If you don’t have one (or either), call me. But at the very least, educate yourself on what you are signing and protect yourself and your rights.
