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Guide to Music Licensing

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Justin Stanizzi
Guide to Music Licensing
on Sep 25, 2018 at 6:42:32 pm

Hey Everyone, I'm from a startup that deal with music libraries and their music licenses. I had to do a deep dive into music licensing and the current systems that manage rights abuses. At this point I think I can be a pretty useful resource to anyone with questions on it.

In the mean time, I did a significant write up on music licensing types, and some of the issues around it. Hopefully editors looking to use music will find this useful, and maybe it might give a tip to some of the composers out there as well.

Here we go:

Digital creators (and especially YouTube creators) face a particularly difficult challenge when acquiring music for their productions. The biggest threat is getting nabbed by YouTube’s Content ID system or, worse, getting a DMCA strike. It doesn’t help that music licensing is a particularly muddy topic.

UNDERSTANDING HOW MUSIC BREAKS DOWN
A piece of music doesn’t actually have a single license. It has multiple licenses, each designed to handle a different part of the music ecosystem to which people contribute. The licenses are usually composed of rights associated with each step of music production that eventually gets us to a master track or recording. This is particularly important, as you need to know the type of license for the different parts of a song you would like to use. Obtaining a license from a solo artist who writes, performs, and records their own music can be pretty straightforward. On the other hand, obtaining a license for music produced or managed by a label music can be very, very complicated. Keep this in mind when pursuing a piece of music that you would like to use.

To detail the complication in licensing, the following is a breakdown of the licenses associated with different aspects of music creation.

PUBLISHING AND CREATIVE RIGHTS
A song is written and composed by one or many contributors. In order to recreate (or publish a performance) a written song, you usually need to compensate the contributors to the song. These people make their money on creating songs for themselves or others to perform and record. The major publishers employ entire teams of people to just turn out compositions and those people expect to be compensated when their work is used to create new recordings of music. The written music is broken down into two main pieces: lyrics and composition.

LYRICS
There are usually several writers who work together to create lyrics for your favorite piece of music. These writers actually own the right to the lyrics and can grant a license for those lyrics to be used in any new recording. The rights to lyrics are known as Lyrics rights. This is particularly important if you want to record and distribute a cover of a song that uses these lyrics; present or display the lyrics in full; publish them on the web, in a piece of software, or in print.

COMPOSITION
A piece of music is comprised of "written music". This is the actual notated rhythm, instrumental parts, and general melody. This goes as far as any guitar riff or identifiable portion of music that might have been written into a song. Legal battles have been fought over guitar riffs that appeared in other recorded music. See Vanilla Ice’s Ice Ice Babyand Queen/David Bowie’s Under Pressure. The rights to composition are quite obviously called Composition rights. If you were interested in recording a cover of a song, then you need to seek out composition rights to actually use the composition of that song. Acquiring these rights gets a bit tricky, as you have to work directly with the composers of a song (or their representatives) in order to get the rights to record it. In a lot of cases, this can be multiple artists and producers. This is inconsistently enforced, as some artists don’t take issue with a cover of a song unless you are using their composition and making money from it (e.g. selling CDs, digital copies, streaming revenue, etc.). Seek out the license at your own discretion. A one-off performance is usually safe.

MECHANICAL RIGHTS
This is a license that is specific to “republishing” a work of music. This is almost always specific to distribution. You should consider it if you will be selling copies of a video, album, or something else that will get distributed for a customer to own. This has historically meant selling a DVD, CD, vinyl, etc… More recently, this has expanded to include things like digital downloads of content that would contain a written musical composition. In order to gain these rights, you have to work directly with the artists and production team, or the organizations that represent them.


When a copyrighted piece is played in a public space, its writers, producers, and performing artists are all entitled to compensation for the right to use their property. Essentially, if a group of people can hear it without having to pay to hear it, then it's likely subject to a performance rights royalty. The people who are usually responsible for paying this is the entity or organization benefitting from the playback of the song or recording. Radio stations have to pay the royalties. YouTube has to pay the royalties. A sports arena has to pay the royalties. Television networks pay the royalties. You don’t necessarily have to seek out performance rights to use recorded music, but someone will likely have to pay money to a performance rights organization if the music is played in a public space. Even Starbucks has to pay these fees for the right to play music in their stores.

PERFORMANCE AND PROS
Performance rights are the rights to perform (read: play back) a piece of music. In most cases, an artist grants a 3rd party the right to collect performance royalties on behalf of them. These are commonly known as PROs (Performance Rights Organizations). In some cases, you need to be granted specific performance rights from the musician. Only very specific use cases require express permission from a rights holder.

If a piece of digital content uses a music recording that has a PRO attached to it, it means that the PRO will collect a portion of revenue made from that piece of music from the entity or organization that is benefiting from it. For YouTube, this means that YouTube pays a royalty to the PRO on behalf of any user who has uploaded a video containing a music recording that is registered with that PRO. While all this sounds very complicated, it means very little for the YouTube creator who has uploaded the video. Their only obligation is to provide the platform (YouTube in this case) with a “cue sheet” that tells YouTube what music recording was used, as well as in what parts of the video. YouTube takes care of the rest.

RECORDED MUSIC RIGHTS
Recorded audio rights, or master recording rights, are the most common licenses people need to get in order to use a recorded piece of music. After all, most people aren't looking to record their own version of music; they are looking to use an existing piece of recorded music. In most commercial music, this is the music label's domain. Music labels go out of their way to find artist to create music that they can market and sell. In some cases, they outright buy other labels to acquire a repository of recorded music. Because there is big business in this, it is pretty fiercely defended. For production music (read: not commercial music), 3rd party publishers (e.g. production music libraries such as Pond5) usually acquire the right to republish and distribute recorded audio. These rights break down into two major types of rights: master rights and mechanical rights.

MASTER RIGHTS
This license grants you the right to playback a master recording of a song, but limits the distribution of that playback. This is usually reserved for use in theatrical movies or broadcast radio or television. These rights usually come with time limitations or royalty requirements. Again, most labels and production music libraries control the rights to this. For most streamed digital content use cases (e.g. web videos), you will need to obtain a sync license (that bundles Master rights into a rights package) to use a recorded music work (see below).

MECHANICAL RIGHTS
This is a license that is specific to “reproducing” or "republishing" a master recording. You should consider it if you will be selling copies of a video, album, or something else that will get distributed for a customer to own. This has historically meant selling a DVD, CD, vinyl, etc… More recently, this has expanded to include things like digital downloads of content that would contain a recorded music masterwork.

Notice that this is almost identical to the mechanical right granted under "publishing and creative rights." This is because one allows you to republish a composition while the other allows you to republish the actual recording.

BUNDLED RIGHTS
In some cases, music publishers and labels put together a set of licenses to ease the difficulty in getting clearance to use music in certain mediums. The most common one is Sync rights, which is a type of license package that was created to deal with digital streaming and distribution. Before sync rights, a company might have to seek out a mechanical, master, and performance right to use a piece of music before they were able to apply it to their content. Below is a set of packaged rights that are the most common.

SYNC RIGHTS
This is the most important license that digital content creators have to worry about. This grants a licensee the right to play back a recorded piece of music in their project, typically subject to pre-set restrictions on use and distribution. More importantly, it almost always pre-clears the use of the content with the artist, providing the user with a faster, easier path to safely license the musical work. This specifically relates to the right to use a master recording and not the reproduction (or cover) of a musical composition. Most production music libraries sell sync licenses, which provide the customer with everything they need safely use the licensed work in their project.

FAIR USE
Ahh, the biggest misunderstood concept in copyright. To start, there isn’t a true definition of fair use. It’s been interpreted by district courts but it generally falls into a defense for using a copyrighted video or audio work for review or critique purposes. If you are recreating new, non-critical videos or audio with copyrighted material, expect it to get flagged. Generally speaking, this is a thing you should avoid as there is very little precedence that grants broad usage rights of a piece of copyrighted content. If you have copyrighted audio in your video, either expect your video to be flagged and demonetized/removed, or seek out the necessary licenses to use said material.

Sonic Bloom, LLC is a start-up focused on providing the best tools to discover, license, and utilize music. Sonic Bloom has developed Bard, and Koreographer to help creators get the most from their music.


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Richard Crowley
Re: Guide to Music Licensing
on Sep 26, 2018 at 3:42:26 am

Thank you, @Justin Stanizzi.

Note that MECHANICAL License/Rights typically refers to AUDIO-only recordings (by whatever physical media: wax-cylinder, vinyl disc, cassette, CD, etc.) Mechanical licenses in the USA are subject to copyright laws which provide for compulsory licenses (after the original recording) and at statutory-established rates ($ per minute per copy, etc.) Because of the compulsory licensing and statutory rates, mechanical licenses can be easily purchased online through agents like the Harry Fox Agency, etc.

OTOH, SYNCH License/Rights covers synchronizing music with IMAGE (film or video). Alas, in the USA, synch licensing is neither compulsory nor governed by statutory rates. So license must be negotiated with the rights-holder on an individual basis. In other countries (like Canada, AFAIK) they have something more streamlined like mechanical licensing is in the USA. Although there seems to be some rights-owners that are making it easier to acquire sync licenses.

Remember also that the different kinds of rights, licenses, laws and practices varies from one country to the next. So while what Justin shared appears to be USA-centric, it does not necessarily address licensing laws and practices in other countries.

---------------------------------------------------------------------------------
Recording audio without metering and monitoring is exactly like framing and focusing without looking at the viewfinder.


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Justin Stanizzi
Re: Guide to Music Licensing
on Sep 26, 2018 at 9:35:06 pm

@Richard, thanks for the follow up. This is indeed for US rights management, although a lot of the production libraries we work with can manage across boarders due to the way they manage sync licenses. For label music, this is 100% true. The label doesn't even consistently represent an artist across boarders, so getting the rights to a song that will play in multiple regions can be a huge pain.

As you mentioned, Harry Fox agency is a good resource for finding non-recording rights. Tivo's Rovi has a lot of the other rights information as well.

Thanks again for the follow up!


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Ty Ford
Re: Guide to Music Licensing
on Sep 27, 2018 at 9:22:43 pm

Hello Justin and welcome to the Cow Audio Forum.

Thanks for the well written explanation (and thanks to Richard Crowley's points). I'm at this from several sides; as a producer and also as a music creator. I have an account at Harry Fox and use it as needed to cover (pardon the expression) material from others that I record and produce. Their Song File has been very helpful.

Bard and Koreographer look interesting. I don't have time for that rabbit hole today, but will revisit them. Tim Westergren, as some will know, created a system for helping his clients communicated what music they wanted him to create. After creating this system, friends told him that he had created a great set of algorithms for streaming music and as a result, we now have Pandora. Are Bard and Koreographer similar?

Here's the Pandora Part of the story I wrote after speaking to Tim somewhere around 2007. I believe he left the company in 2017.

PANDORA.COM
Tim Westergren founded Padora.com seven years ago as a result of his own
experience as a musician and film composer. ³I was spending a lot of time
finding my clients¹ music taste so I could write for them. After a while I
got pretty good at zeroing in on what they wanted. The thought occurred to me
that if I could ³bottle it² and create an effective interface I could do
something with it.² What Westergren has bottled is a complex
highly-interactive database that allows users to enter the name of a group,
musician or song they like and let the database create a personal ³radio
channel² or playlist of similar music. By name, The Music Genome Project.

As the pieces of music are served up, the listener gets to choose whether
those pieces stay in rotation, aren¹t heard as often or are deleted.
Listeners can also click on the selections and be routed to Amazon where they
can buy CDs or to iTunes where they can purchase individual cuts

Westergren says a song or a group¹s popularity is not a criteria. ³Relevance
is the only thing that drives us; relevance for each individual listener.
Right now each listener can have 100 different stations and the more they
curate them, the more personalized they become.

Creating such a database is not easy feat. The Pandora library currently
holds about 420,000 pieces of music and has been adding nearly 15,000 pieces
of music every month. Pandora employs forty-eight trained music analysts.
Having a music major is a requirement. Each analyst must take 150 hours of
training to prepare for the task. Training takes place at the Oakland, CA
headquarters. Westergren says, after training, analysts may spend twenty to
thirty minutes categorizing each piece of music. The result is that each song
has a four hundred point DNA-like database profile that is used to predict
what songs a listener might like.

Last year Pandora caught the attention of Microsoft and an ad revenue sharing
deal was quickly made. For now and in the foreseeable future, Westergren says
ads will be visible on the page, but not audible. Now, with 5 million
subscribers nationally, Westergren has opened offices in London and Tokyo to
take the project international, where they are making performance rights
deals with organizations in different countries.

According to the WiMAX Forum (http://www.wimax.org), you can deploy a WiMax system
and get throughput up to 40 megabits per second for upload and download per
channel, for a range of 3 to 10 kilometers. The revolution may not be
televised after all. Instead it may be webcast.

Ty Ford has been writing for Radio World since 1986. He may be reached at
http://www.tyford.com.

Regards,

Ty Ford
Cow Audio Forum Leader

Want better production audio?: Ty Ford's Audio Bootcamp Field Guide
Ty Ford Blog: Ty Ford's Blog


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Justin Stanizzi
Re: Guide to Music Licensing
on Sep 27, 2018 at 9:43:21 pm

Thanks for sharing that! And Pandora just sold for 3.5 billion with ~80 million subscribers, and 6 million paying subscribers!

Pandora's finger print fell to a lot of the same problems other matching systems do; it's subjective, and ultimately has to do broad assumptions to avoid false positives. Pandora was great for its time.

Bard, as a product, is primarily an aggregator to get a grip on the ballooning production music industry. Anyone who has had to deal with production knows there are tons of sources for music. We're trying to do what Kayak did for travel, and create a platform that makes it easier to shop across multiple catalogs. We have about 1.4 million songs that we can query currently.

We have a proprietary data system that we call koreography to fingerprint music. We actually identify things like beat, song structure, instrumentation, and map it in music time. Think of it like MIDI markup, but it can contain more descriptive information.

Our hope is to algorithmically derive the information using the latest MIR (music information retrieval), map it against the timing of the music, and use machine learning to make observation about similarities between music.


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Ty Ford
Re: Guide to Music Licensing
on Sep 27, 2018 at 10:52:36 pm

Justin,

Got it. Cool.

How would, "Peter, Not The Wolf", a world/fusion piece I just finished hit Koreography?
https://store.cdbaby.com/cd/tyford7

Same question about my meditational pieces based on the Sanskrit Chakra System.
How would Koreography react to cut #7? "Universal Chakra" (aka "Bliss") https://store.cdbaby.com/cd/tyford4

Regards,

Ty Ford
Cow Audio Forum Leader

Want better production audio?: Ty Ford's Audio Bootcamp Field Guide
Ty Ford Blog: Ty Ford's Blog


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Justin Stanizzi
Re: Guide to Music Licensing
on Sep 30, 2018 at 5:09:55 pm

Hey Ty,

You're music sounds great! We currently host music via proxy. We have partnerships with Pond5, Audio Jungle, and Jamendo. We'll be adding Shutterstock and Alibi music shortly.

Another options is our longer term partnership with SourceAudio. We'll be working with the artists that utilize their platform to allow us to access their music through a newly developed API.

If none of those options interest you, I would love to get in contact with you more directly to talk about what kind of methods you do use, and how you would like people reaching out to you (as you normally sell licenses to your music).


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