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Fair fee for song licensing?
Old 17th November 2009
  #1
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BlueRadio's Avatar
 
🎧 10 years
Fair fee for song licensing?

I will be licensing a song to a large corporation...a big company; they are a household name.

What is a fair flat fee for unlimited use for one year? Multiple years? I am not going through BMI, any agency or lawyer. I want the deal to be as simple as possible.

Thanks guys.
Old 17th November 2009
  #2
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ivmike's Avatar
Quote:
Originally Posted by BlueRadio ➑️
I will be licensing a song to a large corporation...a big company; they are a household name.

What is a fair flat fee for unlimited use for one year? Multiple years? I am not going through BMI, any agency or lawyer. I want the deal to be as simple as possible.

Thanks guys.
1. Keep your publishing (i.e., don't sell nor give away the writing credit to the song)

2. Negotiate a fee for this particular usage; don't allow clauses like "in perpetuity throughout the universe" to exist that would give the corporation unlimited domain over the piece of music. For instance, if you are licensing the song for usage in "music on hold" for their telephone system, create the license specifically for that use, otherwise your song will end up in training videos, commercials, etc. and you will not be compensated for it.

3. Register your song with BMI/ASCAP otherwise, you are not going to collect any songwriting royalties if the song is used in TV ads, for instance. If you aren't a member currently, become one ASAP. If the song is used on TV spots, you'll receive media-buy sheets that list which stations will be running the ads and at what time; these you submit to BMI/ASCAP along with a video of the commercial featuring the song (or a YouTube link) so that they can collect your songwriting royalties.

As for a contract with this company, you might want to speak with an entertainment lawyer and get a quick contract drawn up (one that you can re-use for other clients).
Old 17th November 2009 | Show parent
  #3
Deleted User
Guest
Lawyer up. That's simple.

However, getting screwed over is simple too, your pick...

ASCAP/BMI is also a MUST.
Old 17th November 2009 | Show parent
  #4
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Paul_G's Avatar
 
🎧 10 years
It depends on your power.
We don't do any syncs for less than a certain amount each side...publishing and recording depending on the territory. many times they will just fake the track with a soundalike muppet if it is too expensive.
What is it worth to you?
lawyers etc. can run up huge bills for a small deal... so proceed with caution. Although if the song has the potential to be a hit off the back of the ad, then protect your interests with the right representation.
Old 17th November 2009
  #5
Gear Guru
 
10 Reviews written
🎧 10 years
Quote:
Originally Posted by BlueRadio ➑️
I will be licensing a song to a large corporation...a big company; they are a household name.

What is a fair flat fee for unlimited use for one year? Multiple years? I am not going through BMI, any agency or lawyer. I want the deal to be as simple as possible.

Thanks guys.
What are they offering?

What is the use?

TV commercial?

National?

How did they get in touch with you?

More questions than answers I'm afraid as it all makes a difference.

b
Old 17th November 2009 | Show parent
  #6
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jeremy.c.'s Avatar
Quote:
Originally Posted by Paul_G ➑️
many times they will just fake the track with a soundalike muppet if it is too expensive.
What is it worth to you?
lawyers etc. can run up huge bills for a small deal... so proceed with caution. Although if the song has the potential to be a hit off the back of the ad, then protect your interests with the right representation.
Which is really sad and weird to hear you say that since I know of someone who knocked off a really cool Morcheeba track for a movie... (his music usually sucks otherwise, if that's of any consolation to you, your music is the bomb btw)

To the OP, the business being the business as it is, I can't imagine your first move wouldn't be to invest in a good lawyer.
Old 17th November 2009
  #7
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RKrizman's Avatar
 
🎧 15 years
Quote:
Originally Posted by BlueRadio ➑️
I will be licensing a song to a large corporation...a big company; they are a household name.

What is a fair flat fee for unlimited use for one year? Multiple years? I am not going through BMI, any agency or lawyer. I want the deal to be as simple as possible.

Thanks guys.
What will it be used for? I've seen songs go for $100,000 for a one year exclusive ("Happy Together"). For film trailers and tv shows songs by well known artists can routinely command in the neighborhood of $25,000 for a limited use. An unknown like me can command anywhere from 1k to 10k for the right song. And I've given it away for as little as 50 bucks just to cement a relationship.

Just so you have the language right, you license both "sides", meaning that you collect one fee for licensing the copyright or composition itself, and collect a second fee, typically the same amount, for licensing the actual physical recording. Please affiliate yourself with ASCAP or BMI to collect performance royalties. This usually does not come out of the pocket of your client, and depending on usage, can be quite substantial (or not).

If you are unknown, and the song is unknown, you're looking at the bottom end of the scale. More if it's forever, more if it's exclusive.

Everybody has their own way of negotiating, but I've found after years of doing this that the client pretty much already has a number in mind, and that you'll eventually end up close to that number. Sometimes it's as simple as just asking what they are budgeted for. Then, if they want exclusive rights or some other special consideration you can use that to ask for a little more dough.

Good luck,

-R
Old 17th November 2009
  #8
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dan p's Avatar
 
🎧 10 years
I just did an internet license deal for a theme I created for the products tv commercial.
Got paid thousands for the commercial and 500 for the additional internet license payable yearly.I will make some publishing and split the writing with my writing patrner for backend for years if the product plays that long.
IF you can keep your publishing and writing up front fee can be anywhere from 1500 to 3000.


Dan P
Old 17th November 2009
  #9
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sahiaman's Avatar
 
🎧 10 years
You need to figure out what they are willing to pay. That can be hard not knowing the client, or their past history on these dealings. The best rule of thumb is the let them through out the first figure, and collect as much information from them before you put a figure out.

There is a lot of different language you need to watch out for, and if you don't know what it is, you'll have to get yourself a lawyer. You should also make the decision based on IF you are planning to make deals like this again, if you are, then it's your goal to make sure the buyer is happy with what they purchased, and the deal they got. A negotiation is successful when both sides walk away thinking they got a great deal.

If you can go ebay email and order chester karrass effective negotiating cds, do so right away.
Old 18th November 2009 | Show parent
  #10
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BlueRadio's Avatar
 
🎧 10 years
More Info

Guys,


Allow me to clarify my position a bit more. These will be the terms for my potential client:


- unlimited use in TV, web, and radio for ONE YEAR

- flat fee for said time period

- NO ownership and/or publishing rights included in fee



Consider that this song is for a major corporation, and they have expressed significant interest in using this track on their website, Facebook, and probably TV down the line.


Additional thoughts?
Old 18th November 2009 | Show parent
  #11
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burst's Avatar
 
🎧 15 years
Quote:
Originally Posted by BlueRadio ➑️
Guys,


Allow me to clarify my position a bit more. These will be the terms for my potential client:


- unlimited use in TV, web, and radio for ONE YEAR

- flat fee for said time period

- NO ownership and/or publishing rights included in fee



Consider that this song is for a major corporation, and they have expressed significant interest in using this track on their website, Facebook, and probably TV down the line.


Additional thoughts?
I would not, under these circumstances, offer any kind of Direct Performance License... and would instead opt to be sure you have the song registered with your PRO (ASCAP, BMI, SESAC) so as to facilitate the collection of your performance royalties (which can be significant, especially if you aren't selling or sharing the publishing on this master).

Kudos!
Old 18th November 2009 | Show parent
  #12
Gear Addict
 
burst's Avatar
 
🎧 15 years
Also :

+1 on the lawyer.

CRITICAL with the numbers and exposure you're talking about here. CRITICAL.
Old 18th November 2009 | Show parent
  #13
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Etch-A-Sketch's Avatar
 
🎧 10 years
Quote:
Originally Posted by BlueRadio ➑️
Guys,


Allow me to clarify my position a bit more. These will be the terms for my potential client:


- unlimited use in TV, web, and radio for ONE YEAR

- flat fee for said time period

- NO ownership and/or publishing rights included in fee



Consider that this song is for a major corporation, and they have expressed significant interest in using this track on their website, Facebook, and probably TV down the line.


Additional thoughts?
Just so you are clear in understanding this... the company isn't the one who pays BMI or ASCAP. You and they are aware of that correct? The company itself will never pay a dime to ASCAP or BMI, EVER! The network that AIRs the commercials (NBC, ABC, FOX, etc) are the ones who pay ASCAP/BMI when your music airs.

Also be aware that TV commercials run in 13 week periods. Most contracts for commercials are only 13 weeks long and then have to renew for another 13 weeks and pay another licensing fee as well as pay the networks for the advertising time again.... So you are giving them the rights to air your commercial for 4 consecutive runs (13 x 4 is 52).

When you hear of big companies paying someone $20,000 for one song or $40,000 for one song... that is that one song for ONE 13 week period. Not for a whole year. Just as a point of reference, I know VISA paid $40,000 to license a song from an unknown artist the ad agency heard on youtube. They were using the music as temp, and said "Why don't we just license the song from the artist!?". The music supervisor on the project told me they ended up paying $40,000 for one 13 week run, the artist kept his publishing and songwriting.

So... I would say to you, since you aren't a HUGE name artist... roughly $30,000 per 13 week period for a National ad would be a good ball park figure. $30,000 x 4 (13 week periods) = $120,000 but ONLY IF YOU GET TO KEEP YOUR PUBLISHING AND SONGWRITING. For a national ad campaign you can expect to make anywhere from $10,000 to $100,000 from ASCAP/BMI for it airing on prime time Network TV...but it depends on how often they run the commercial. If the commercial airs internationally forget about it... you are looking at $100,000 to maybe as high as $500,000 is they air it a ton overseas.

Realize that if the company decides they want to own the publishing... then THEY get half of that $10,000~$500,000. If they try to take your songwriting credit as well, then they make all that money for themselves.

If they tell you they want to take all the publishing and songwriting so you don't get any ascap/BMI royalties then you will probably want to charge them anywhere from $300,000 to $500,000 for the year. It sounds extreme, but it really isn't since they will most likely make a large portion of that back (if not all of it) from ASCAP/BMI.

That's the other thing to realize... TV WILL NOT air any commercial if there is no cue sheet for it stating the composer and publisher information. The TV station will get fined by ASCAP/BMI for doing so. When this company turns in their commercial to the TV networks, it will get kicked back to them unless there is a cue sheet with songwriter and composer info on it. So if they don't list you, they will undoubtedly be listing themselves as publisher and/or composer... which means it is in your best interest to retain your ASCAP/BMI ownership of your song so that you get paid for the airing of your music.

get an entertainment attorney ASAP. specifically one that deals with copyright law. You could literally have hundreds of thousands of dollars (if not millions of dollars over the course of 4 or 5 years) at stake here. borrow the money for the lawyer's retainer if you don't have it yourself... This is not something you should be negotiating on your own.
Old 18th November 2009
  #14
Elk
Gear Nut
 
🎧 10 years
You need an entertainment lawyer with experience in licensing contracts. The company is not going to do you any favors and is happy to take advantage of you.

PM me if you would like. I can refer you.

Please don't do this on your own.
Old 18th November 2009 | Show parent
  #15
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BlueRadio's Avatar
 
🎧 10 years
Etch-A-Sketch,


Thank you for your helpful post. So basically, NOT registering with BMI and collecting royalties would be very foolish, as nothing comes out of my client's pocket in this respect, correct?

I am in the process of registering with BMI right now. I am still wary of involving a lawyer, only because of the expenses that I might accrue. I am trying to find someone who will at least give me a free consultation.

Any other comments would be helpful. Thanks guys.
Old 18th November 2009 | Show parent
  #16
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dan p's Avatar
 
🎧 10 years
I recently paid 300 an hour for my lawyer.Worh every penny.Make sure you create your own publishing company through BMI.You have to come up with a name for your pub co and make sure no one else has that name.
I did a trademark on our pub co.Costs money and takes time and only needs to be done once.
Unfortunately most deals are not straight forward thats why knowing all the particulars like etch said is paramount to your success.Good Luck!



Dan P
Old 18th November 2009
  #17
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Hammer Mark's Avatar
 
🎧 10 years
Quote:
Originally Posted by BlueRadio ➑️
I will be licensing a song to a large corporation...a big company; they are a household name.

What is a fair flat fee for unlimited use for one year? Multiple years? I am not going through BMI, any agency or lawyer. I want the deal to be as simple as possible.

Thanks guys.
A good publisher will probably get you more money than you will get on your own -- even after they take their cut. Since you've already made a contact to license the song, you might be able to do a co-pub or admin deal in which you get half the publishing or more. To counter an earlier post, when you sign with a publisher, you assign them the copyright (which allows them to exploit the work for profit), but you retain your status as the creator of the musical work -- that cannot be sold or assigned.

You should also be affiliated with a PRO (ASCAP or BMI) in order to collect performance royalties which may be earned in addition to the license fee.

If you want to be in the music business, you need to operate like a business. Affiliations with publishers and PROs are how the business operates.
Old 18th November 2009 | Show parent
  #18
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Etch-A-Sketch's Avatar
 
🎧 10 years
Quote:
Originally Posted by BlueRadio ➑️
Etch-A-Sketch,


Thank you for your helpful post. So basically, NOT registering with BMI and collecting royalties would be very foolish, as nothing comes out of my client's pocket in this respect, correct?
Exactly. The only people that have to pay ASCAP and BMI money are broadcasters and any venue of public performance (jukebox, concert halls, arenas/stadiums, radio stations, TV networks, etc). As of right now, there isn't any fee for online/webcast performances. So composers don't get paid for that, although that will probably be changing soon.

So yes, there is no reason why you shouldn't be affiliated with BMI, have your own publishing company listed with BMI, and register this work with them. You are only screwing yourself out of a lot of money and probably giving the company the ability to make way more money off of you than you made off of them.

Remember, in the end, your music is helping sell their product. Not the other way around. Why should they make all the money you deserve to get from your artistry?
Old 18th November 2009 | Show parent
  #19
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RKrizman's Avatar
 
🎧 15 years
Quote:
Originally Posted by BlueRadio ➑️
Etch-A-Sketch,


Thank you for your helpful post. So basically, NOT registering with BMI and collecting royalties would be very foolish, as nothing comes out of my client's pocket in this respect, correct?

I am in the process of registering with BMI right now. I am still wary of involving a lawyer, only because of the expenses that I might accrue. I am trying to find someone who will at least give me a free consultation.

Any other comments would be helpful. Thanks guys.
If you really don't want to get a lawyer then at least ask BMI for legal advice when you join. They can be very helpful, and they want your business. If BMI is not helpful, then immediately dial 1-800-95-ASCAP.

Also, you still didn't mention how the music will be used. If it's for a commercial then the performance royalties may not be very big and you would want more front money. If it's to be used as the theme for a syndicated or network show then the performance royalties will be SUBSTANTIAL, to the point where you don't want to screw the deal by demanding too much up front money.

-R
Old 19th November 2009 | Show parent
  #20
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hank alrich's Avatar
 
🎧 10 years
Quote:
Originally Posted by Thumper ➑️
Lawyer up. That's simple.

However, getting screwed over is simple too, your pick...

ASCAP/BMI is also a MUST.
Thumbs up. If the OP knew enough about this to handle it to his own advantage he wouldn't be asking questions here. This is not a simple undertaking, and the cost of proper, skilled, experienced legal representation will turn out to be far cheaper than what the OP will get screwed out of by thinking he'll do it himself.

A PRO is also essential. How the hell does he think he'll track this activity, absent the professional attention of ASCAP, BMI, or a similarly qualified performcance rights organization?

If I need surgery, shall I ask online for instructions?
Old 22nd December 2010 | Show parent
  #21
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thoughtcriminal's Avatar
 
🎧 10 years
Stumbled onto this thread looking for places to submit tracks for licensing (like Pump audio etc..). I totally agree with everything in this thread, however I might let a corporation rape me for the rights of ONE song if I knew that would parlay into other deals. Anybody know of anywhere?
Old 23rd December 2010 | Show parent
  #22
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CrownBox's Avatar
 
🎧 10 years
Engage the attorney- its a no brainer.
Old 23rd December 2010 | Show parent
  #23
Gear Head
 
thoughtcriminal's Avatar
 
🎧 10 years
Hmm not exactly the answer I was looking for, responding to me or the OP? Just looking for any user experiences. thanks
Old 23rd December 2010 | Show parent
  #24
Vum
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Vum's Avatar
 
🎧 10 years
Quote:
Stumbled onto this thread looking for places to submit tracks for licensing (like Pump audio etc..). I totally agree with everything in this thread, however I might let a corporation rape me for the rights of ONE song if I knew that would parlay into other deals. Anybody know of anywhere?
Realistically, if your music is on air and THAT launches your career then that song will be likely be in heavy rotation for so long that you will be missing out on a fortune which will likely be significantly more $$ than a successful album. Being a 1-hit-wonder is far better than a no-hit wonder, financially of course.

And anyone who wants to skimp out on an attorney because it "costs money" has never been in a position to lose any. Trust the vets - most of us have a legal rep on our gift lists.
Old 23rd December 2010
  #25
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cinealta's Avatar
 
🎧 10 years
You need to consult an entertainment attorney. This is not a simple thing and could adversely affect you. $500 for an hour consult is peanuts if you stand to earn $30k or more for a one year's deal.
Old 23rd December 2010 | Show parent
  #26
Gear Head
 
thoughtcriminal's Avatar
 
🎧 10 years
I agree, especially for whoever the OP was and for that large of a deal. I'm still small time, so for me it's just depended on whether you're pitching something on your own or going through a company that pitches it to clients for you, they handle the legal stuff for me and I still get to keep the rights to the song. I get paid based on a percentage agreement that I signed with that pitching company. ATM it works out cuz I don't have to pay them and they pay me IF it gets licensed, they worry about all the negotiating stuff with the client. And it gives more time to get as much music out as possible.. Anyways friends of mine and myself have had some luck getting paid acceptably by one or two companies in particular, I'm just looking for more. But if I was pitching for big deals on my own or with the help of an agent I would of course get a lawyer. I'm just saying everybody says "get a lawyer, get a lawyer" which you should, UNLESS you're on the broke side of things like I am ATM and you've already got a company representing you for small-medium sized deals. If you have your copyright and your PRO's you're set, with a lot of newer companies like these.


Was really posting here to try and find specific places where other artists may have submitted music on their own and gotten decent royalties or licensed? I know it deserves its own thread so I'm not gonna post about it anymore here .
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