June 1, 2021 • 7 mins read
Music license agreements: what they are and how to navigate them
Want to better understand music license agreements? You’ve come to the right place. In this guide, we’ll explain what licensing agreements are, why they are essential in the business of making money with music, and how to navigate them to make the most of them.
What are music license agreements? Music licensing agreements, pretty much everything in the music industry revolves around them. Whether you’re: Sending your music to a music distributor to get your songs in all stores Adding collaborators to an existing work Signing a sync deal to place your music in a film production …you’ll be working with music licensing agreements! To use or exploit (sell) music copyrights you need a license.If you aren’t an original creator or copyright owner, you need music license agreements to use music legally .
When music is “written” it creates a copyright for the music. These days, “written” may mean recorded as audio or MIDI in a Digital Audio Workstation (DAW).
Copyrights protect a creator from somebody using their work, and claiming it as their own. This is important to consider when writing music, as well as when working with samples or covers.
Anytime you use somebody else’s work, in any way, you will need permission from the copyright owner(s). This is the essence of music licensing agreements.
In some territories (countries or states), writers must register their copyrights. Other territories legitimize music copyright immediately after writing new melodies or lyrics.
You will want to check what your local copyright law requires you to do.Once you have a music copyright, your music becomes an “asset”. In fact, a particular type of “asset” called “intellectual property” (IP).
Assets are items of property owned by a person or company that have “value”. This means it is tradable for a price.
IP is any property owned by a person that is “intellectual” in nature. This covers copyrights, trademarks, patents and more.
There are 2 different copyrights that protect recorded music:
Master rights protect the recording of music. Before computers, music was recorded in physical formats such as tape.
The original recording was then copied onto other formats such as: Vinyl recordsAn original recording was called a “master recording”. This terminology is now embedded into the business of music. So, we still use the term “master” even though in the digital world, music is not replicated in the same way.
Traditionally , record labels owned the master records and rights. They licensed songs from publishers and sold records for big profits. Master royalties went to the labels. Another royalty, mechanical royalties, went to publishers and writers. This was a fixed rate for every copy made of a recording.
Over time, there have been more artists withholding control of their master copyrights.
Publishing rights protect the composition and lyrics of music. They are split between the “writers” (including composers) and the “publisher”.
This is another arrangement that has existed since the start of the music business. Early composers weren’t able to make copies of their sheet music and sell it to orchestras to perform. This became the job of the music publisher.
Nowadays, it’s much easier for a composer or songwriter to find an act to perform and record their music. Often, they are also the performer themselves!
Different types of rights mean that commercial opportunities blossom. This could be with performing, recording and using music in a variety of ways. Music licensing ensures creators and copyright owners get paid for the use of their work.
For all writers, but especially self-published writers, it’s essential you register yourself and your works with a performance rights organization. These will collect performance royalties whenever music is played:
Sometimes, only registering with one local PRO can limit the royalties you’re receiving. This can be because you’re only collecting half (writer but not publishing) royalties or because your PRO doesn’t collect from some overseas territories.
Using a service like SongTrust can ensure all of your royalties are collected worldwide. Our friends at Music with Flavour have written a great article about registering with SongTrust as a writer.
Sync license – the right to use a piece of music or song in a film production. This requires permission from both the master and publishing copyright owners
