# A few questions about music library/production music agreements



## Arbee (Mar 3, 2022)

I don't have an offer or agreement in front of me yet, but I'd like to be on the front foot and armed with some knowledge (and be neither naive nor a PITA if/when it happens). For context - I've had song publishing and record deals in the distant past, and worked since then as an IT exec for a global book publishing company for many years, so the topic of rights and royalties is not foreign to me.

*How negotiable?* I'm focusing on exclusive libraries with an openly stated 50/50 synch fee share and 100% writer share, and I'm looking for ongoing professional relationships as much as placements. I see no reason to agree to less than that, and no reason to contemplate any buyout offer, even for simple piano underscore. Is that realistic or are there instances where I should be more flexible?

*Reversion of rights.* Is it normal practice to have publishing rights returned to the composer for tracks that generate no income over a period of, say, 2 or 3 years? Or is a fixed term more common, or "in perpetuity"? And, If your production music publisher gets bought (or goes out of business), do you trigger the right to terminate or continue the agreement.

*Territorial rights.* Are there any gotchas around sub-publishing in other territories or sim. that I need to be on the lookout for?

*Auditability.* You receive a statement that says you earned $x from a track, but how do know there hasn't been a backdoor licencing agreement done in the hope you never find out. Do you include an automatic termination and/or penalties clause for this scenario? If you're in a solid professional relationship and delivering the goods, I'd hope that the mutual benefit breeds trust and integrity, but you know....

Thanks for any insights or advice, very much appreciated.


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## Daryl (Mar 3, 2022)

1. It is highly unlikely that you'll get more than 50%, and in many cases it is standard to get less. There is also the issue of recoupment to deal with.

2. With a top tier Publisher you won't get your "rights" back. If that Publisher is sold, then there can be a clause that you have a choice whether or not to get your rights back. However, remember that it's not just about the rights to the music. It's also about the rights to the recording, so it may depend on who actually owns that.

3. Normally a Publisher has the rights in all territories.

4. Backdoor licencing agreements will happen. Sub Publishing agreements will happen. You have no say. There are always audit clauses in contracts. However, if you're with one of the majors, don't think that this will do you any good. Unless you have $$$$$$$ it's not worth your time and money.


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## GtrString (Mar 4, 2022)

Basically, you can find the money between the library and their clients.

Not signing anything should be your default position, then let your research prove you wrong. 

Sorry, but I don’t think you will ever get ahead taking deals from music libraries.


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## Daryl (Mar 4, 2022)

GtrString said:


> Basically, you can find the money between the library and their clients.
> 
> Not signing anything should be your default position, then let your research prove you wrong.
> 
> Sorry, but I don’t think you will ever get ahead taking deals from music libraries.


I'm not sure what you mean by "you will ever get ahead taking deals from music libraries"? Are you talking financially? That's obviously not true. But what else could you mean?


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## Arbee (Mar 4, 2022)

Daryl said:


> 1. It is highly unlikely that you'll get more than 50%, and in many cases it is standard to get less. There is also the issue of recoupment to deal with.
> 
> 2. With a top tier Publisher you won't get your "rights" back. If that Publisher is sold, then there can be a clause that you have a choice whether or not to get your rights back. However, remember that it's not just about the rights to the music. It's also about the rights to the recording, so it may depend on who actually owns that.
> 
> ...


Thanks Daryl, pretty much what I was expecting but would rather ask than assume. Much appreciated.


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## Roger Newton (Mar 4, 2022)

Everything Daryl points out. Done deal.

One other thing that's a pet hate of most people. Watch out for the co-write 'option' with some libraries.


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## GtrString (Mar 4, 2022)

Daryl said:


> I'm not sure what you mean by "you will ever get ahead taking deals from music libraries"? Are you talking financially? That's obviously not true. But what else could you mean?


There are a couple issues:

- You don't build your network directly with clients, so you depend on a middleman who is taking care of their own business, not yours
- You don't get to brand your own music, so over time you don't build a name that could bring you in position to make better deals
- You trade a major percentage of your most valuable asset, the rights to your music, for in many cases, empty hopes. How many businesses would do that? If you think of yourself as a business, music libraries as a business proposition is really bad news for songwriters and composers.
- If we are talking financially, there are many scenarios where you don't see a single cent from library placements in tv and film productions, and where the above points still apply. Especially, if you are a new writer and haven't researched the company, nor have read the fine print of your contract.

So, yes, it is by far the most likely that you will never see one cent, build a brand, keep your assets intact, or get a solid business proposition - even if you get placements, if you sign with a music library. To clarify, I would call that "not getting ahead".

I basically disagree with 3/4 of your statements above. 1) yes 50% is standard, but not less. 2) it is not uncommon with reversal clauses, in fact it is a trademark with good publishers, because they are willing to prove that they believe in your work, and intend to push it 4) sub-publishing cannot happen without being stated explicitly in your contract, so you have a say by not signing. Far too many composers sign far too many contracts, a reckless and desperate behaviour imo.

As these threads are not just for the OP's own pleasure, or posters personal convictions, I think it is important to cause some awareness about dealings with music libraries. Licensing is all over the place now, as being promoted as the last frontier in music business, and there are so much misinformation online, that can easily lead young people to put far too much hope into dealings with music libraries.

It is a nice market, where the established have newbies for lunch. And it is declining, so there are tons of desperate hustlers in the pool next to you. So, excuse me, but there is a need for critical and cautious voices.


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## Roger Newton (Mar 4, 2022)

GtrString said:


> Sorry, but I don’t think you will ever get ahead taking deals from music libraries.


Do you mean taking a deal other than the standard deal that just about every writer gets?

Edit: Simultaneous post.


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## GtrString (Mar 4, 2022)

Roger Newton said:


> Do you mean taking a deal other than the standard deal that just about every writer gets?


I stand by my post above. There are established writers who can navigate the music library market well, but they are few, and would probably have made more money through other avenues anyway. This claim in particular is pure speculation of course, but not unreasonable given the current state of the licensing market.

Of course, if you don't care about the money, nor necessarily a career, or just treat licensing as a small part of your portfolio, you just do what you want. We do that anyway.


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## Roger Newton (Mar 4, 2022)

GtrString said:


> There are a couple issues:
> 
> ect.


Maybe some of what you caution may apply in very rare instances. But most of what you've written doesn't ring correct.

The most important thing that perhaps people new into production music don't understand is DISTRIBUTION.

It's also worth remembering that the vast majority of production music writers that don't make any money is because they're not very good at it. Distribution is arguably the second most important thing. Being good at it is probably the most important but these days I'm not so sure about that.

In terms about caring about the money that would depend on your pov. I care about making money for the publishers because as I have pointed out on numerous occasions, they don't do it as a hobby. Sure, when royalty days come around it's always interesting from a personal angle. For what it's worth, I am a principal voting member of the PRS.


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## GtrString (Mar 4, 2022)

Everything is based on the premise, that you can produce good (in the context) music. That is a given. But the OP did not present himself as a newbie.

I'm happy to follow the thread with all of the good stories coming, proving me wrong about the claims with personal anecdotes and experiences.

But I would not enjoy to see lobbyists using the thread to add credibility to particular corporate interests and policies..


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## Jeremy Spencer (Mar 4, 2022)

GtrString said:


> I'm happy to follow the thread with all of the good stories coming, proving me wrong about the claims with personal anecdotes and experiences.


The problem is, most of us don't have the time, knowledge or business savvy to solicit client's directly, hence the appeal of working with a library company (I personally HATE that aspect). For example, I had placements in a mainstream reality series last year. This would not have happened on my own, and it was a surprisingly decent payment on my PRO statement. I enjoy getting my quarterly SOCAN statement, it's like Christmas morning as a kid Lol. It's cool to see where my placements were internationally, and extra cool when I see royalties. I won't be running out and buying a Lamborghini anytime soon, but it's fulfilling to see the fruits of my labour, and patience is the key with licensing.


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## Roger Newton (Mar 4, 2022)

Jeremy Spencer said:


> The problem is, most of us don't have the time, knowledge or business savvy to solicit client's directly, hence the appeal of working with a library company (I personally HATE that aspect). For example, I had placements in a mainstream reality series last year. This would not have happened on my own, and it was a surprisingly decent payment on my PRO statement. I enjoy getting my quarterly SOCAN statement, it's like Christmas morning as a kid Lol. It's cool to see where my placements were internationally, and extra cool when I see royalties. I won't be running out and buying a Lamborghini anytime soon, but it's fulfilling to see the fruits of my labour, and patience is the key with licensing.


Yes it's distribution. I get placements like a lot of people here every day. There's no chance that we could access that kind of distribution brought about by the world sub publishers sales teams. How am I going to distribute in Canada for example. And not just a one off lucky one. Time and time again.

I was also thinking about Gtr Strings comment about producing good music. It depends on how the word 'good' is construed. Yes we all want well mixed, well mastered tracks. That is where there may or may not be some confusion with people coming into the production music/library business. And it is a business.
Good is probably more to do with, does this piece of music, or extract more likely, work with television. That's what editors are probably more interested in.


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## Daryl (Mar 4, 2022)

GtrString said:


> There are a couple issues:
> 
> - You don't build your network directly with clients, so you depend on a middleman who is taking care of their own business, not yours
> - You don't get to brand your own music, so over time you don't build a name that could bring you in position to make better deals
> ...


OK, I'm not going to get into a "mine is bigger than yours" argument, but you should give a yearly figure of what "getting ahead" means, in financial terms. $10K? $20K? $50K? $100K? Without that none of us know to what you refer.

It would also be useful to know which libraries you've written for that abide by the statements you have made. I'm only talking abut my experiences. I have no idea regarding yours.


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## Daryl (Mar 4, 2022)

Roger Newton said:


> Maybe some of what you caution may apply in very rare instances. But most of what you've written doesn't ring correct.
> 
> The most important thing that perhaps people new into production music don't understand is DISTRIBUTION.
> 
> ...


I think that perhaps you should explain to the non PRS members what "Principal Voting Member" means.


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## rgames (Mar 4, 2022)

Arbee said:


> no reason to contemplate any buyout offer


Why not?

I'm not doing much library work these days but as of 5-6 years ago the buyout deals I got were pretty lucrative. $500 - $1000 for a track that takes a couple days to write and produce. Do that a couple times a month and it's a pretty good gig for as little effort as it takes. It's a great option if your primary gig is teaching or performing or working outside the music world.

Common wisdom from 30+ years ago was never to do buyouts. But times are changing. If I were just getting into the library world I'm not sure that conventional wisdom is still wise. So do your homework and make sure you evaluate all the options. More importantly, take a look at where the music business is headed.

Most importantly, don't take advice from someone you've never heard of on a public internet forum 

rgames


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## Roger Newton (Mar 4, 2022)

Daryl said:


> I think that perhaps you should explain to the non PRS members what "Principal Voting Member" means.


The same as you are  

It's just a level under their newish corporate system. It's just based on earnings at a pretty good level according to the PRS.


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## Daryl (Mar 4, 2022)

Roger Newton said:


> The same as you are
> 
> It's just a level under their newish corporate system. It's just based on earnings at a pretty good level according to the PRS.


Of course, there is also the "get an extra nine votes" category, and the "get a personal PRS account manager" category. For both of those, one would assume that the writers had been able to "get ahead".


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## Roger Newton (Mar 4, 2022)

And of course you can stand as a PRS Director should that be appealing.


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## Jeremy Spencer (Mar 4, 2022)

rgames said:


> Why not?
> 
> I'm not doing much library work these days but as of 5-6 years ago the buyout deals I got were pretty lucrative. $500 - $1000 for a track that takes a couple days to write and produce. Do that a couple times a month and it's a pretty good gig for as little effort as it takes. It's a great option if your primary gig is teaching or performing or working outside the music world.
> 
> ...


You mean a 100% buyout with zero writer's share? Just me, but I would never do that....like ever. What if that $500 buyout ends up in a situation that could have earned you several thousands in royalties? The client is the one who benefits from those types of deals, not the composer, and it devalues our services in the big scheme of things.


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## rgames (Mar 4, 2022)

Jeremy Spencer said:


> You mean a 100% buyout with zero writer's share? Just me, but I would never do that....like ever. What if that $500 buyout ends up in a situation that could have earned you several thousands in royalties? The client is the one who benefits from those types of deals, not the composer, and it devalues our services in the big scheme of things.


The buyouts I did granted writer's share back to me but I never made much money on the performance royalties. 
Certainly if you have access to the kinds of libraries/productions that will guarantee you major placements then that's the better deal. But if not, I wouldn't be surprised if the buyouts are the better deal.

For example, ASCAP just sent out their annual report. They hit a record-high $1.3B in payouts (or thereabouts) for 850,000 members. If you do that math, that's only $1500 per member *if* the payouts were evenly distributed. But they're not - I bet there at least half of those payouts are going to no more than 1,000 people (that would be an average of $650k/yr). That means the other $650M is distributed to 849,000 members, or about $765 each (again, if evenly distrubuted).

So, bottom line, no matter how you do the math the royalty payments for most people are basically worthless. If those people get an opportunity to do a buyout I'd say odds are it's the much better deal. And the trends I've seen indicate that it's only going to get better because more and more broadcasters are trying to find ways around the royalty system.

For me the royalties paid a bit more but not by a lot. The buyouts were still very much worth my time. I'd have been perfectly fine forgoing the royalties for a guarantee of $500 - $1000 for every track I ever wrote and produced.

Again, it depends on where your business is. But I'd say buyouts are definitely worth considering, especially if you're just starting out.

rgames


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## Arbee (Mar 4, 2022)

Thanks everyone for these varying perspectives, I really appreciate the input. I very much understand that I could take the high road and gradually build my own network at source, but my goal at this stage of life is to see how far I can re-develop my composition and production skills. After my first music career I worked in corporate for 20+ years, so I'm enjoying the creative process and would rather develop good relationships for distribution. I have no real objection to buyouts if that suits people better, but it's not for me.


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## Daryl (Mar 4, 2022)

Roger Newton said:


> And of course you can stand as a PRS Director should that be appealing.


Funny you should say that...


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## Roger Newton (Mar 4, 2022)

Jeremy Spencer said:


> You mean a 100% buyout with zero writer's share? Just me, but I would never do that....like ever.


I agree. It's a little bit like publishers that don't pay Mechanicals.


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## Arbee (Mar 4, 2022)

Daryl said:


> Funny you should say that...


Sounds like someone I know who spent a few years building a huge royalties base with TV show themes, and the next 30 years protecting them as a PRO chairman 🎶💲


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## rgames (Mar 4, 2022)

Arbee said:


> Sounds like someone I know who spent a few years building a huge royalties base with TV show themes, and the next 30 years protecting them as a PRO chairman 🎶💲


That's one problem I've found with PROs: they're a good deal for a small number of people at the expense of the vast majority of people who are likely better off without them (as my example above pointed out).

It's the music business version of Russian Oligarchs.

EDIT: for example, I've posted examples like the one I gave above on ASCAP's YouTube videos several times. They're perfectly rational explanations of how the royalty system might not be the best option for everyone. Those comments are always deleted.

rgames


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## JohnG (Mar 4, 2022)

GtrString said:


> Sorry, but I don’t think you will ever get ahead taking deals from music libraries.


What? I made tons from working with music libraries, and other composers on v.i. also have prospered that way.

*The Agreement vs. the Relationship*

Regarding the written agreements, of course ideally they are favourable to the composer. Nevertheless it's much more like getting married to someone, working with a library, than some kind of rules-based relationship. As with a marriage, it's already going south if you have to dredge up the agreement to hammer the other party.

Put another way, if they are making money and you're making money, the terms (other than the split) are pretty irrelevant. If it ends unhappily, trying to enforce terms of some agreement may not be worth your time, let alone the cost of an attorney or something.

In short, try to find a library that has a decent profile and make friends. Write killer music and everyone will be happy.

*Skin in the Game*

Moreover, the terms you can expect vary greatly depending on whether the library is paying to record, mix and master your tracks. If all they're doing is hiring a guitar player, that's one thing. It's completely different if they're going to Abbey Road and paying up front for an orchestra, engineers, travel and all that. So the terms will change depending on how much money they are putting in up front. I have frequently foregone some upfront fee in order to have more of the back end. I figure if they're paying $10,000 or more to record your track, they have a very good incentive to get it placed ("skin in the game" as it's known).

On a related matter, I would never ever give away my writer's share. Ever. Especially not for $500 or $1,000.


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## Daryl (Mar 4, 2022)

Arbee said:


> Sounds like someone I know who spent a few years building a huge royalties base with TV show themes, and the next 30 years protecting them as a PRO chairman 🎶💲


And by doing that, helped everyone else along the way.


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## Daryl (Mar 4, 2022)

rgames said:


> That's one problem I've found with PROs: they're a good deal for a small number of people at the expense of the vast majority of people who are likely better off without them (as my example above pointed out).
> 
> It's the music business version of Russian Oligarchs.
> 
> ...


The vast majority of people aren't going to be able to make a living as a composer, no matter what the deals on offer. One has to accept that. It's the same with all creative ventures.

You might be able to get a $500 licence fee (with no Royalties), but you have to try to sell your track, which takes time and effort. Without lifting a finger, I can get multiple uses, again and again. These add up to far more than your one-off $500.

Look, we all have our experiences, but for me there are two things that make me successful. Quality, and distribution. Both are important.


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## rgames (Mar 4, 2022)

JohnG said:


> On a related matter, I would never ever give away my writer's share. Ever. Especially not for $500 or $1,000.


Yes but that's because it's the better deal for you. For me it's been basically a wash. As the example I gave above shows, that's not the case for the vast majority of songwriters and composers (assuming ASCAP is a good representation). There's no question those people would be better off with a buyout deal so I don't think anyone can make a blanket statement that avoiding buyouts is the right approach for everyone. It's bad advice. Granted, that's not what you said, but it's implied and is explicitly stated elsewhere, and rather frequently on this forum.

I've never given up writer's share on anything but I certainly would for the right price. If my ASCAP royalties were only $756/year I'd definitely take $500 per track and give up my writer's share. That's the reality for those 849,000 other people.

rgames


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## Roger Newton (Mar 4, 2022)

rgames said:


> I've never given up writer's share on anything but I certainly would for the right price. If my ASCAP royalties were only $756/year I'd definitely take $500 per track and give up my writer's share. That's the reality for those 849,000 other people.
> 
> rgames


If you were making $756 a year you wouldn't be working the at library I work for very long. And who is going to give anyone $500 for a track in this day and age based on $756 a year with any PRO?


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## rgames (Mar 4, 2022)

Roger Newton said:


> If you were making $756 a year you wouldn't be working the library I work for very long.


Yeah - that's the point I'm making.

Apologies but I don't follow your post and question.

$500 - $1000 is a pretty typical buyout price for a full-length track, at least as of a few years ago. I've also done 30-sec buyouts for $200 or something like that. Of course, those are per-track averages. The deals are most often for collections of 10 or 20 tracks. I don't think I've ever done a buyout for just one track.

rgames


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## kenose (Mar 4, 2022)

IME, $500 is nowhere close to enough for a complete buy out of a library track. Solid tracks with a good publisher can easily make $500+ in a single quarter, you would be completely insane to relinquish writers share.

$500 is in the ballpark of a upfront fee on a deal where you sign the track over exclusively and retain your writers share...


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## Roger Newton (Mar 5, 2022)

rgames said:


> Yeah - that's the point I'm making.
> 
> Apologies but I don't follow your post and question.
> 
> $500 - $1000 is a pretty typical buyout price for a full-length track, at least as of a few years ago.


What I'm saying is $756 a year in performance royalties versus $500-$1000 buyout doesn't make any sense. Why would anyone pay buyouts for that amount to someone who was making $756 a year from ASCAP.

And $500 for a track seems risky. Writers can make that and quite a bit more in a single performance payment regardless of future mechanical payments on top.


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## chillbot (Mar 5, 2022)

@rgames since you seemed to want me to respond here...



rgames said:


> For example, ASCAP just sent out their annual report. They hit a record-high $1.3B in payouts (or thereabouts) for 850,000 members. If you do that math, that's only $1500 per member *if* the payouts were evenly distributed.


This is fact, according to the latest ASCAP annual report.



rgames said:


> But they're not - I bet there at least half of those payouts are going to no more than 1,000 people (that would be an average of $650k/yr). That means the other $650M is distributed to 849,000 members, or about $765 each (again, if evenly distrubuted).


This is a number that you pulled out of thin air and for some reason $765/756 per year keeps getting repeated as if it means anything. Unless I'm missing something?


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## VVEremita (Mar 5, 2022)

I don't have any numbers on it, but I want to mention that a considerable amount of PRO members might not be media composers but artists for whom royalties are not that important, or not even relevant, like singer-songwriters or bands who live on merch and touring (or more likely don't live on music at all)

I used to be in a band and income through performance rights was not really of importance.

So it is hard to estimate how payouts are distributed among a number of members.


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## rgames (Mar 5, 2022)

chillbot said:


> Unless I'm missing something?


Maybe. I'll try one more time.

This forum is getting better but it's still pretty tough to have a rational conversation about whether the PRO model actually makes sense these days.

OK.

ASCAP states $1.3B collected last year for 850,000 members. If evenly distributed among all members that would be $1529 per member.

But it's not evenly spread out. Obviously some people make a LOT MORE than $1529. I certainly do and I'm a nobody who hasn't written much music in the last five years. For every person who makes more than $1529 it reduces that $1529 value for everyone else. That's basic arithmetic: there's one pie. If someone gets a bigger piece, someone else gets a smaller piece. If 850,000 are eating that pie and a handful of them get big pieces then the rest get really tiny pieces.

So make whatever estimates you like - the BEST CASE SCENARIO is a $1529 per-person maximum. The vast majority of ASCAP members MUST BE earning less than $1529 per year from ASCAP royalties.

So how much money are they making with ASCAP? Where does most of the money go? Maybe to 1000 people? Maybe 100? Maybe 200? The point is it doesn't matter - divide it up however you like (go ahead - show me your take). Basic arithmetic shows that the vast majority of ASCAP members MUST BE making almost nothing from royalties. Therefore, if offered a buyout deal, it's highly likely to be a better deal that what they currently have with the royalty system.

A few other points that seem to always get lost in these threads:

1. A buyout doesn't necessarily mean you give up royalties. As I said above, I always got the writer's share back in my buyout deals.

2. However, even though I kept the writer's share on those buyouts, to this day those tracks have generated $0 in royalties because they didn't go to broadcast - they were never intended to. Therefore, *for anyone who would have done that gig the buyout was clearly the better choice*. You can't make a statement that buyouts are always bad from a revenue standpoint. That's factually not correct. One of my buyouts was for a bunch of 15-30 second spots for electronic greeting cards. Why in the world would I care about performance royalties for electronic greeting cards? There are none. So the buyout was clearly the smarter choice for everyone involved.

3. You can collect royalties without a PRO. In fact, the vast majority of royalties around the globe are collected without a PRO. Engineers collect vastly more royalties than composers. There is no PRO for engineers. And, on average, engineers who make money on royalties make a *lot* more money than composers. So the notion that you need a PRO to represent your interests is disproved by an entire planet's worth of engineers who collect royalties.

4. Given #3, there are moves afoot to abandon PROs, and by some big-name players (Netflix, Discover, etc). I'd say 90% of the time I check on where music for a YouTube video came from it's Epidemic Sound, who won't even allow you to join if you're affiliated with a PRO. Maybe the PROs made sense 50 years ago but I'm not sure they still do, and I wouldn't be surprised if they disappear in 20-30 years. To anyone starting out, that must be an important consideration.

5. Of course you can find examples of people for whom buyouts would have been a bad deal. That doesn't mean they're a bad deal for everyone.

6. Seems like I have to repeat it - Of course you can find examples of people for whom buyouts would have been a bad deal. That doesn't mean they're a bad deal for everyone.


Maybe that'll help... Alas. If history is an indicator I'll probably try again in a year or so.

rgames


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## chillbot (Mar 5, 2022)

rgames said:


> If history is an indicator I'll probably try again in a year or so.


We agree on something at least!


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## chillbot (Mar 5, 2022)

rgames said:


> 1. A buyout doesn't necessarily mean you give up royalties. As I said above, I always got the writer's share back in my buyout deals.


This may be the case but this is not what people are talking about when they refer to the term "buyout". I would think most people here would say if you are keeping your writer's share and royalties they don't consider that a buyout in this sense.

Additionally, even in your example of writing for a medium that has no backend, maintaining the ownership of the music means you can license it elsewhere so there is still the potential for royalties.

I get your ASCAP numbers, even the ones you made up make sense to me. But I'm not sure how it has a bearing. No one is striving to be one of the less-than-$1,529-per-year earners. If you want to pull some more random numbers I bet there are 100,000 ASCAP members who have never made a cent, maybe they are hobbyists who joined out of potential but never even finished or sold a track (I know some of these). Maybe another 100,000 are retired or haven't written a piece of music in 20 years. Anyway looking at it as "Oh geez there's only 1.3B to split between 850,000 people I better not even try and take whatever I can get!" is not a good outlook for this business.


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## rgames (Mar 5, 2022)

VVEremita said:


> a considerable amount of PRO members might not be media composers but artists for whom royalties are not that important


I'm not sure why anyone would join a PRO if he's not interested in royalties. The whole point of joining a PRO is because you want to collect royalties.

Here's an example for a band:

Let's say they have one songwriter with ASCAP. Let's also say they release an album with 15 songs and the songwriter wants to collect royalties on it.

Per the numbers above, it's highly likely that the revenues he/she is collecting from those 15 songs is less than $1500/year. Let's say it's $1000/year.

Well, if they were offered a buyout deal at $1000/song they'd make $15,000 right away. If not, it's going to take them 15 years to make that amount of money. Throw in time value of money and the present value is significantly less - the actual break-even term is probably more like 17 or 18 years.

In that case I'd say the buyout is probably the better deal. $15k in my pocket today is better than $1000/yr for nearly two decades, and without even any certainty that it'll continue.

rgames


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## chillbot (Mar 5, 2022)

rgames said:


> Per the numbers above, it's highly likely that the revenues he/she is collecting from those 15 songs is less than $1500/year. Let's say it's $1000/year.


You're building your whole argument on made-up numbers again. That's not how royalties work.


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## bbunker (Mar 5, 2022)

I'm intrigued - what is a 'buy out' buying from you? If you keep your writer's share, what exactly is being bought? Exclusivity? I'd probably call that a consideration fee then. Their right to use it? Isn't that a sync or use fee?

I went on Songview for a few minutes to see what sort of numbers there are. I looked up a random surname, and then looked to see work titles numbers for the 100 that popped up. Any guesses on how many had no work titles at all? How about more than 100 work titles?

26 had no works at all. 0 had more than 100.

I tried another surname, random page number, similar result. 24 with zero works, none more than 100.

Hard not to suggest that the 'typical' ASCAP member is someone who has an album, or a few singles out, and is hopeful that they'll make some money, somewhere. Which is fine, of course - but is a world away from someone who would be considering a "typical library/production music agreement."


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## Roger Newton (Mar 5, 2022)

rgames said:


> One of my buyouts was for a bunch of 15-30 second spots for electronic greeting cards. Why in the world would I care about performance royalties for electronic greeting cards? There are none. So the buyout was clearly the smarter choice for everyone involved.


I just lost the will to live.


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## Daryl (Mar 5, 2022)

Richard, I don't think you understand the concept of a buyout. I've had lots of music licenced for projects that weren't broadcast and weren't designed for broadcast. That has nothing to do with a PRO. You're confusing mechanicals with performance royalties.


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## Daryl (Mar 5, 2022)

Look, there is a real disparity between how much people earn in Royalties. I get it. If you're an amateur, producing a few tracks each year, with no real distribution, yes, you aren't going to generate much in the way of Royalties. Neither should you. This situation bears no relationship to people who are professional library music composers.


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## JohnG (Mar 5, 2022)

Over time, you can make a hundred thousand dollars or more on a single track if it catches fire.

You never know. If you put out 10 tracks, four may never license, four may earn a thousand or something, but the last two could go crazy.

Most people I’ve talked to who pursue this successfully have said, anecdotally, that they have 100 or more tracks out there. Some have many hundreds.


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## Jeremy Spencer (Mar 5, 2022)

rgames said:


> 1. A buyout doesn't necessarily mean you give up royalties. As I said above, I always got the writer's share back in my buyout deals.


I think you’re convoluting what a buyout is, which literally means you sell the track with zero rights (like Epidemic). What you’re describing is no different than a work-for-hire agreement. A buyout is just that…a buyout. If you want to help the industry race to the bottom with that type of market…be my guest.


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## kenose (Mar 5, 2022)

bbunker said:


> I'm intrigued - what is a 'buy out' buying from you? If you keep your writer's share, what exactly is being bought? Exclusivity? I'd probably call that a consideration fee then. Their right to use it? Isn't that a sync or use fee?
> 
> I went on Songview for a few minutes to see what sort of numbers there are. I looked up a random surname, and then looked to see work titles numbers for the 100 that popped up. Any guesses on how many had no work titles at all? How about more than 100 work titles?
> 
> ...



A complete “buyout” is buying out the master recording and all associated publishing rights (including the writers share of publishing) from the owner, which in this case would be the composer.

This is what many of us are arguing is bad, in the context of library music deals. If you do this deal, and the track is used on TV and makes $1000 in publishing royalties you get $0.

A more standard deal is where you sign over the master recording, but retain your writers share of the publishing. Most of the time, the library should be paying you some sort of initial upfront fee in this transaction.

Unfortunately I have also heard this confusingly referred to as a "buyout." I guess because unlike a non-exclusive deal, the library is "buying" the master recording rights. Like Jeremy, I classify this more as a standard work-for-hire agreement.

This deal is basically what any high end, exclusive library is going to want— they need to be able to exclusively represent the master recording. The publishing is split 50/50– they take the “publishers share” and you take the “writers share”.

In this case, when the track generates $1000 in royalties, you now make $500 from your half (“writers share”) of the publishing.

I feel like it's pretty obvious why taking $500 for a *complete* buyout of a track is not recommended, in the context of library music. $500 is more suited to the upfront fee in the standard deal that I outlined above, where the library pays for the transfer of the master recording rights and splits the publishing with you.

Signing away your writers share is always a gamble, you are basically gambling on the upfront you receive to be worth more than the new owner will ever see from royalties— OR that having the money in hand immediately is worth more to you than waiting for royalties to accrue over the years. I can absolutely imagine some situations where this deal could make sense, but library music for the most part is not one of them.

The library should be working to place the music however they can— if you think they are only placing music in ways that generate essentially no publishing (like Youtube, micro licenses, etc), *that is you taking a gamble*. It might be true— until they have a shot at a juicy TV placement, and suddenly you're leaving thousands on the table.


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