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Music licensing

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Music licensing

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Music licensing is the licensed use of copyrighted music.

There is extensive international law which covers music licensing. Nothing in this article should be considered a substitute for qualified legal advice.

Contents

Definitions

The following words and phrases will turn up regularly in any comprehensive discussion of music licensing, and are listed in no particular order:

license 
the right, granted by the copyright holder, for a given person or entity to broadcast, recreate, perform, or listen to a recorded copy of a copyrighted work
licensor 
the owner of the licensed work
licensee 
the person or entity to whom the work is licensed
performance 
for the purposes of this article, the live performance of a musical piece, regardless of whether it's performed by the original artist or in the manner it is best known
broadcast 
the replaying of pre-recorded works to multiple listeners through various media or in a 'semi-live' setting such as a bar or bookstore, and including radio, tv, webcasting, podcasting, etc. (Note: Using this definition and the previous one, you find the information that leads to phrases like 'live broadcast performance'.)
performing rights organization 
large companies, the best-known of whom are ASCAP, BMI, and to a lesser extent SESAC (there are others as well) whose fundamental job it is to keep track of every single performance or broadcast of all works protected under copyright. A more in-depth analysis of how these organizations work will be threaded throughout the body of this article
copyright 
literally, 'the right to copy.' Prior to 1909, no effective international law of copyright existed. The first major international copyright law conventions were the Berne Convention for the Protection of Literary and Artistic Works created in 1886. It is not within the scope of this document to examine the various changes, additions, and ancillary agreements to the Berne Convention.
synchronization licensing 
the licensing of musical works to be performed as a soundtrack, 'bumper', 'lead-in' or background to a motion picture.
publisher 
for the purposes of copyright, a publisher is the owner of the copyrighted work. It is now standard practice for songwriters of even the slightest prominence to form a 'publishing company' who actually owns the rights to their work; the reasons for this are matters of legal finery and largely not of value to the scope of this article. This phrasing is reflective of the state of media at the time of the Berne Convention, when all music distribution was done on paper as sheet music (or player piano rolls).

Music Licensing Basics

What is Music Licensing?

Music licensing is the process by which songwriters, in theory, get paid for their work. In much the same way you don't own that copy of Doom or Windows (or Linux), a purchaser of recorded music does not own the music, they own the media that music is stored on, and they have a limited right to use the music for themselves, so long as 'using' doesn't mean 'making unlicensed copies of' or 'broadcasting' the recorded work.

There has long been a school of thought that those who buy music have the right to do as they please with it. By the same token there is school of thought that says that an artist or composer has the sole exclusive right to decide how and when their work will be used, and for what price.

While the arguments on both sides are loud and have both valid, positive points and invalid, negative points, it is not the intent of this article to engage that particular debate. However, it is worth noting that the debate exists; at its very basic level, it comes down to a question of the right of an artist to be paid versus the right of a consumer to own what they purchase.

What is Broadcasting?

There are, of course, many different definitions of 'broadcasting,' but for the purposes of a discussion of music licensing, 'broadcasting' may be considered to mean the playback of pre-recorded or live music for groups of people other than the licensed purchaser of a given work, beyond what might be normally expected in a social setting. Playing music in your car is not broadcasting, unless you're playing it out of your car for a large group of people, for instance at a tailgate party. There has been some legal wrangling over the years about what, exactly, constitutes a 'broadcast' for the purpose of license/copyright enforcement. Legal claims are filed nearly every day across the world against bookstores, bars, and live music venues which broadcast music without paying for it.

In a nutshell: If you are playing music in so that people outside of your close, immediate area can hear it, you're broadcasting, and by law you are required to keep track of what you play and pay for it. This is equally true of non-profit organizations, live music bars, bars or clubs that feature pre-recorded music, bookstores that play music, coffee shops that play music, roller-skate rinks, podcasts...anyone.

So why aren't grocery stores and elevators being sued?

Because they're paying. Generally speaking, the 'background' music you hear in places like grocery stores or elevators is a service which is purchased from one of many organizations which offer it (the largest of these, of course, is Muzak). Part of the fee paid for this service is used to cover licensing costs.

How do they figure out who gets paid, and how much?

The easiest way to look at this issue is by examining the day-to-day operations of the average music radio station. Every time a song is played someone, or something, makes a note of the title of the track, the name of the artist, and the time it was played, and this information is submitted to the Publishing Rights Organizations. There is a fairly complex series of calculations involved. First, the total number of songs played is tabulated. Then the total amount of license income is calculated. The second number, divided by the first, represents a single 'share' - a value equaling the percentage of cash that a single play of a single song amounts to (this is, of course, a minuscule number). This 'share' is then multiplied by the number of times a given song is played to arrive at the total value of that song's license royalties during that quarter.

For instance:

Let's say that in Q12005, 100 songs were played (this is, of course, a very, VERY small fraction of the total number of songs played in a quarter, but we're going for ease of calculation here). Let's further say that the total amount of royalties collected in that quarter was $200. Therefore, each song played is worth two bucks. So, if Aerosmith's "Dream On" was played 3 times, Aerosmith gets six dollars as their share for that quarter.

This constitutes a dramatic oversimplification of the process, and the processes for each PRO are slightly different, as are the percentages, but in a nutshell, this is how it's figured.

Recorded music

Radio

Radio stations pay fees for the rights to broadcast music. They may pay to BMI (Broadcast Music Incorporated) and ASCAP, just to name a few.

Live music

Home video

Licensing issues are often encountered when television shows or films using copyrighted music are released on Digital Versatile Disc (DVD) format.

When a song is cleared for usage on a TV show, the clearance typically only applies to television airings of the show in question. Thus, when the show is released on DVD, the rights to the song must be renegotiated in order for the song in question to be included on the DVD.

If the process of clearing the rights to the song is prohibitively expensive for the company releasing the show on DVD, or if clearance is refused by the copyright holders of the original song, a number of solutions can be chosen from. The affected song is usually replaced with a similar (sound-alike) one which is cheaper to license or the footage containing the copyrighted song is edited out; depending on the show and the television company involved. In a few cases, television shows which use so much copyrighted music such that the cost of licensing is high are withheld from release on DVD.

Artists Who Usually Refuse Permission to Licence their Music in Films and Advertisments

Led Zeppelin usually refuse permission. Exceptions being Almost Famous, School of Rock and Fast Times at Ridgemont High.
The Beatles. Rights to most of their songs are owned by Michael Jackson, who, since the mid 1980s has usually refused permission.
The Rolling Stones. One Notable exception being Start Me Up, which was Licensed to Microsoft for the launch of Windows 95.


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Music Sound, v. 2.0, by MultiMedia

This guide is licensed under the GNU Free Documentation License. It uses material from the Wikipedia.


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