I have been listening to an audio seminar on direct licensing that I purchased from www.filmmusicmag.com and it inspired me to write a couple of pieces on the subject.
Through my experience in the music licensing industry, I have come to understand that although many composers, bands and artists understand what performance royalty organisations (PRO’s) do, some do not fully understand the terms of the agreement between them and the royalty collecting society. This is understandable as copyright laws are complex and all PRO terms differ.
You may be thinking that PRO’s are a good thing as they are non-profit organisations and exist to collect royalty income for music copyright holders. Don’t get me wrong, I am not anti PRO, but I do think some are better than others and there is room for improvement. In fact, some PRO’s terms actually have the potential to restrict future income of many of their members.
I believe that as an independent composer you should retain all of your copyrights in order for you to earn revenue when the opportunity arises, whether this is through: -
- Royalty cheques from TV / Radio play
- License fees via Royalty Free Music Sites
- Direct payments from your clients for use of your music
Music usage is changing and more people want to use music for internet and other related media, but a number of PRO’s still have a fundamental clause in their agreements that I think is unhelpful to say the least. The clause I am referring to is the exclusive assignment of performance rights to the PRO.
A good example of PRO’s that take a more flexible approach to this is the American societies, BMI, ASCAP & SESAC who operate on a non-exclusive basis. They are only granted non-exclusive rights to collect performance royalties on the composers behalf. This means that on the occasion you have a chance to license directly with the client or through music licensing websites you can. You just need a paper trail of permission that leads back to you. In this case, your PRO is there when or if you choose to use them, but you don’t miss out on other potential broadcast opportunities. Great 
PRO’s that collect exclusively can prevent you from licensing directly or through music licensing websites. If you are registered with a PRO that has exclusive right to collect performance royalties for you, this means that you are not permitted to direct license or sell your music through other websites without potential problems down the line. If you do license directly or authorise a third party website to sell licenses of your music, your PRO can approach your clients at any time in the future and demand that they pay an additional license.
This could become a problem for you if for example, you are letting your family and friends play your music on their websites or if you have sold direct licenses for on hold or public venue use. Legally, you can not do this if you have assigned your performance rights exclusively to a PRO. Just think how damaging and embarrassing that could be for you as a composer.
Many PRO’s in the EU have this clause, including PRS in the UK.
Working in the industry, I have on numerous occasions had to turn down potential revenue opportunities due to this clause, which means that the many independent composers I represent and sell licenses for also lose out.
To enable composers to leverage every opportunity for income, I think that this exclusivity clause needs to go. I see it becoming more problematic in the future as more and more new music uses appear.
Also, members of ‘exclusive’ PRO’s can not take part in exciting new ways of exploiting their own music through Creative Commons licensing.
From Creative Commons FAQ: You need to check with your society. Currently, many of the collecting societies in Australia, Finland, France, Germany, Luxembourg, Spain, Taiwan and the Netherlands take an assignment of rights (or in France what is called a “mandate” of rights that nonetheless has the same effect practically as an assignment) from you in present and future works (so that they effectively become the owner of these rights) and manage them for you. So if you are already a member of a collecting society in one of these jurisdictions, you may not be entitled to license your work yourself under a Creative Commons license because the necessary rights are not held by you but by the collecting society. Please also read the FAQ on the website of the Creative Commons project team for your jurisdiction for more information about this issue in your jurisdiction.
Creative Commons is reaching out to collecting societies in those jurisdictions where this problem arises to try to find a solution that enables creators to enjoy the benefits both systems offer.
If you encounter difficulties with using Creative Commons licenses because of your membership in a collecting society in your jurisdiction that is not listed above, please let either your country’s Creative Commons project team know or email info@creativecommons.org. Also, if you wish to discuss ways to try to deal with the situation in your country please contact your country’s Creative Commons project team.
If you are already a member of one of these collecting societies, feel free to encourage your collecting society to give you the option of Creative Commons licensing.
The most ridiculous part of this is that many UK composers actually resort to using aliases and changing the names of their tracks to get around this. The fact is that currently, PRO’s need at least the name of the track and artist to check if it is in their database. If it does not show a result, they simply can not charge a license. The act of renaming tracks enables some composers to get the best of both worlds whilst there music goes undetected. Personally, this is not something I would advocate.
You may be thinking… Why join in the first place? Well, look at it like this, if you had a free lottery ticket every week would you throw it away? No, of course not! Composers join a PRO in the event that their music is used on mainstream TV, Radio or Film Release. Statistically, the odds are slim, but I suppose you have to be in it to win it. Also, the longer you do it and the longer you are putting your music catalogue out there, the more chance you have.
In most cases, the reality is that composers and end-users alike are disregarding this clause without realising. Composers want to and need to maximise their revenue potential in any way they can and although I don’t advocate it, I can see why some may bend the rules to do this as previously mentioned.
Also, I have it from a reliable source that many of the PRO’s would not necessarily pursue claims against composers direct licensing their own music. I guess it would not look good for a PRO to pursue one of its own members for making money from his / her own music.
Anyway, it is not for me to tell you whether or not to join a PRO, that is for you to decide. What I would urge you to do is to join one that allows you to sell direct licenses. I know a number of UK based composers who have joined American societies for this very reason.
The choice is yours, but all I am saying is for you to get the facts before you decide and if in doubt get a lawyer to confirm what I am telling you.
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I look forward to your comments below. Also, feel free to Digg or bookmark this post I would particularly be interested in comments from PRO’s and composers.
Next time, I will be talking about the value of music and how PRO’s can facilitate keeping value high.
Resources
Direct Licensing – A Better Alternative to ASCAP, BMI and SESASC (Downloadable Event Audio)
http://www.gmostore.com/cart.php?m=product_detail&p=41
Creative Commons
http://creativecommons.org/