Music Licensing 101

Here's a guest post from Anna Durish, marketing and communications director for Rightclearing AG, a company that specializes in music rights clearances. Music licensing is an increasingly more lucrative source of income for many musicians and songwriters, but they usually don't know as much about it as they should. On the other hand, artists, bands, film makers and television producers who want to use someone else's song in their project usually don't know the first thing about how to go about it legally. Hopefully this post will explain all.

"What do the Beastie Boys, Vanilla Ice and Johnny Cash have in common? They were all accused of copyright infringement. What this means can be seen in the case of Vanilla Ice quite clearly. For his song “Ice Ice Baby” he adopted the melody of Queen's and David Bowie's “Under Pressure” almost identically, without having the legal usage rights to it. (Here’s the comparison of the songs).  Since the infringement was quite obvious, Vanilla Ice had to pay a significant amount of money to the creators.

Clearly this isn’t the way that music licensing normally works. That’s why this blog post wants to help you prevent such a disaster from happening by teaching you the basics about music licensing. Because it really isn’t rocket science!

When do I have to license a song?

Let’s start with a little example: Imagine you’re making a video about your holidays and the only thing missing is a piece of music to complete it. Quickly you add your favorite track and you’re done. So far everything sounds quite easy. But when does music licensing come into play? Depends on how you want to use the video. There are two different types of use:

• Private Use: If you only want to show the video to your closest friends and don’t intend to publish it on the Internet or another medium, let alone distribute it commercially, then you don’t need the permission of the creator. You don’t have to license the song.
• Public Use: If you want to show the video to people outside your private sphere by making it available for example on YouTube or if you want to sell it, you need the concession of the creator; you have to license the song. 

Which rights are affected?

To publicly use someone else’s work you have to acquire certain rights of use. There are two different kinds of rights involved: The master and the publishing rights.

• Master rights: The owner of the Master Rights owns the actual recording of the song's sound. These rights usually belong to the party that financed the recording. Often this is the record label if they don’t lie with the artist. 

• Publishing rights: The owner of a song's Publishing Rights owns the rights to the composition; usually this is the author of a piece of music. The author is also the copyright owner unless there is a written agreement by which the author assigns the copyright to another person or entity, such as a publisher.

If you publish your video without acquiring the usage rights, it can, to put it mildly, get quite unpleasant for you. YouTube for example can block your uploaded video or delete your account. If you are really unlucky the rights holder can take legal action against you and demand compensation. The rules apply to all sorts of videos and their public use not just YouTube videos.

How do I license a song?

Enough theory for now! Let’s get straight to the point and talk about how music licensing works in practice. Unfortunately this process is often very complicated and takes a lot of patience. 

• Selecting the song: First of all you need a song. Most of the time you don’t have the perfect song at hand and need to scour the Internet or your personal library until you find a track that matches your video. 
• Legal aspect: After having found a song you have to find out who holds the rights to it. They can lie with the artist, a label, a publishing house or a collecting society. Depending on the country, different publishing houses can hold the usage rights. 
• Request: Now you have to ask the rights holders if you can license the track. You need the permission of both the holder of the master as well as the holder of the publishing rights, which are often different parties. If you’re very unlucky one of them rejects your request and you need to start your search from scratch. 
• Pricing: Next you have to negotiate a price. There are many factors to consider, such as popularity of the song, distribution or type of project.
  Normally songs of very famous artists like Jimi Hendrix, The Beatles, Muse, Queen etc. are very difficult to license or just unaffordable. But even for less famous artists the license can be too expensive. If this is the case you’ll have to start all over again with your search.
• Draw up a contract: Last but not least you need to draw up a contract with the rights holder, which implies that you either have some legal knowledge or are willing to pay a lawyer to work for you.
• Time factor: As you can see, this whole process costs you a lot of time, money and nerves. Depending on the track you want to license you might have to wait several weeks or even a year until you can license the song properly. 

Is there an easier way to license music?

Don’t panic, there is! Before you completely lose your courage, there are several online music licensing services trying to simplify the whole process and solve the problems mentioned above, like audiosocket.com, soundtaxi.net and rightclearing.com. Every page has its advantages and they serve different needs. To get you an idea of what online music licensing is and why it makes the process of music licensing easier, here’s an example of how rightclearing.com works. 

The site offers you a constantly growing sound pool of pre-cleared tracks. This means that it’s already determined who holds the rights to every song. To find a suitable song you can search via keywords or just drop a song in the rightclearing.com search bar and the system will find the most similar sounding pieces in the library. As soon as you have found a song the system will automatically calculate the price of the license. They also offer Creative Commons licenses, which, in some cases, can be obtained for free. After paying for the license an automated lawyer will draw up a legal contract. The licenses are valid worldwide and unlimited.

Thanks to online music licensing services like that you don’t have to wait for month or even years until you have your license. It often takes only a few clicks to legally add sound to your video.

Last but not least…

… this blog post has hopefully helped to clarify the topic of music licensing and answered some of your questions on how it works. Licensing music doesn’t have to be complicated and it definitely pays off in the long run. If you license your songs properly you are not only legally on the safe side, but you also ensure that the artist gets rewarded fairly for his hard work and creativity."

Thanks, Anna, for your insights!

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Trent Reznor Changes The Paradigm Again

I'm pleased to announce that I'll be contributing to Forbes online, analyzing the new music business, and the "Trent Reznor Changes The Paradigm Again" story can be found there.

This means that there will be some changes in the Music 3.0 blog from this point on, in that the focus here will now be more on social media and how it effects the music business. The more music industry focused stories will appear on the Forbes blog site.

I invite you to follow me over at Forbes.

I'd dedicated to providing the most up-to-date information possible, and this change will allow me to more tightly focus on the area of social media and music here. Excerpts from upcoming book Social Media Promotion For Musicians will also be featured here when it's released. Also I may be reposting a story here after it's posted on the Forbes site from time to time.

Thanks again for following and reading. This blog surpassed a million views a few weeks ago, so I don't take your viewership lightly.

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You should follow me on Twitter for daily news and updates on production and the music business.

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The 5 Top Facebook Music Apps

While Facebook seems increasingly to be an adult network of anyone over age 25, it still has over a billion users worldwide, and a number of them frequently listen to music on the service. The analytics site MetricsMonk determined that the top 10 Facebook music apps have around 74 million active monthly users, which is around 33% more than last year. Here are the top 5:

1. Spotify - 33 million
2. Pandora - 8 million
3. Soundcloud - 7.8
4. Deezer - 7.8 million
5. iHeartRadio - 4 million

The big winner here is Spotify, as it almost doubled its users from last year, while Pandora ominously shed users by more than half. The big trend though, seemed to be towards services like Songza and 8Track that provided more personalized streaming, although none of those services even remotely challenges Spotify at this time.

That said, the latest numbers (as of May 1, 2013) state that there are over 1.13 billion active monthly users of Facebook. If less than a tenth of them get their music through the service, then these numbers may not be anything to get excited about. Yes, they're increasing, but there doesn't seem to be a challenge to the standalone streaming services by Facebook in the cards anytime soon.

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Is Music Discovery All It's Cracked Up To Be?

To many in the music tech community, the holy grail of online music involves music discovery. As a matter of fact, some within the industry feel that the music business' future depends on it. That's why any company that has "discovery" as a feature suddenly becomes a hot investor attraction even as investors grow wary of the music industry.

The reason why some think that discovery is the future is many feel that's the best way to grow the industry. Instead of listeners recycling their listening with more or less the same songs from years past as well as a smattering of songs from today that are high on the charts, any way that exposes a listener to something new means that there's a new potential sale, either from buying music, merch or concert tickets.

While that certainly seems plausible, one has to wonder just how much better the current discovery algorithms can get, and if an improvement is really all that necessary. In an interesting article on Hypebot last week, a number of industry vets were asked their views on the subject, and they had some interesting insights.

In the article Jay Frank, the author of Future Hit. DNA (a great resource for anyone in the music business) postulates that music discovery is overrated, since it appeals to only a limited segment of listeners, the ones actively looking for something new, to begin with. That, of course, limits the widespread usefulness of such an algorithm considerably.

Where once upon a time you were exposed to new music on the radio whether you wanted to be or not, today we have too many choices for that to happen as much (even though radio is still the largest form of music discovery, with YouTube far behind). In fact, so much of music discovery still comes from word-of-mouth. If all of your friends rave about the new Daft Punk album, of course you're going to check it out. If you hear mixed reviews, you're less likely to take a listen unless you're overwhelmed by the media exposure (think the last Justin Timberlake album). With a discovery algorithm, you might be exposed to something new, but will that single listen to a single song be enough?

While an improved music discovery algorithm might still be the holy grail for some, it doesn't seem likely that it will change the music business as much as some hope it will.

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Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Is Vimeo Better Than YouTube?

YouTube is the undeniable king of the hill when it comes to online video hosting, but it's far from the only game in town. At last count there were over 90 other sites doing roughly the same thing, which you can see at all-video-sites.com. While most of these sites were very specific in their content, a number of them are a catch-all, open to anything that one might post, as is YouTube.

There is a competitor to YouTube that doesn't open its arms quite as wide, which in many cases makes it a better choice for the serious artist or videomaker. That's Vimeo, which gets 70 million unique visitors a month that are generally more engaged that what you'll find watching the competition.

One of the advantages of Vimeo is that the content is generally up a notch or two from YouTube, with fewer cat and baby videos. Add to that a streamlined layout that allows you to find and watch what you want a lot easier, and you can see why it's preferred by many after they try it.

One of the best reasons to watch on Vimeo though, is that it's advert free, which won't make money for the content creator but sure is better for the viewer. Let's face it; no one likes to wait for a pre-roll commercial before you get to the video you want to check out.

A basic membership is free and allows you to upload one HD video per week or 500meg of storage. The downside is that your uploaded videos are subject to banner ads, the ability to make a video private is turned off, and the analytics package is pretty basic. Upgrade to Vimeo Plus for $9.95 a month and those limitations are lifted. If you're a pro, you can upgrade to a Vimeo Pro account for $199 per year that basically ups the game by providing better video quality, more storage and bandwidth, and the ability to monetize your content.

You might not want to change completely from YouTube, but Vimeo offers a lot - for a price. Then again, with a service like OneLoad, you can upload to a number of platforms and have a presence across all of them. After all, there's nothing like a video everywhere to raise your profile.

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Interested in the Music 3.0 archives? Buy The Music 3.0 Guide To Social Media for the best of over 800 posts.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Facebook's 3D Music Map

One of the cool things about the online world is the variety of measurement tools that are available, and the fact that new ones are being created all the time. Take for instance the 3D music map that Facebook commissioned Stamen Design to come up with.

In the following video, you'll see a number of views of the 90 day viral spread of 3 songs on Facebook; Will.i.am and Britney Spear's "Scream And Shout," Macklemore and Ryan Lewis "Thrift Shop," and Swedish House Mafia's "Don't You Worry Child." Check out how "Scream and Shout" starts to go viral in Miami and New York first before it spreads, and how "Don't You Worry Child" surges in Texas in the middle of February.

While this is just a test of the technology, I can see how a more real time version could be useful to record label marketing departments and agents, as they could see the hot spots of a song's activity and be able to respond with a greater artist presence in the area. For now, it's just a cool video (with no audio, by the way).

The map is part of Facebook Stories, a blog that looks at different ways that people use the social network.

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Interested in the Music 3.0 archives? Buy The Music 3.0 Guide To Social Media for the best of over 800 posts.

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Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Predicting Retweets

What if you could determine how many retweets you'd have before you even sent the tweet? It probably would change the way you compose your tweet and use Twitter for promotion.

Up until now, most marketers depended upon data that suggests either the best time of day, or the best hashtags to use (or a combination of both) to get a feel for what their tweet might do in the wild. That might all change, as an MIT professor has now created a computer model that predicts the number of retweets in its entire lifetime after only a couple of minutes of retweet activity.

“A lot of people felt that Twitter usage was totally random and unpredictable, that it was all just noise,” stated Sloan School of Management assistant professor Tauhid Zaman in an article in the LA Times. “But it turns out that there is a systematic, repeatable behavior that you can model.” Who knew?

You can actually see the model in action on his website Twouija: the Retweet Oracle, which is a twist on the old physical Ouija board. The site shows a number of tweets from celebrities and shows, as well as  how well they match his predictions.

While on the surface this might seem like a boon to anyone who does promotion via Twitter, I don't think the model by itself adds much in terms of promotion, since you have to actually release the tweet first before it can predict what it will do. By correlating that data over time though, it might provide some better clues as to the parameters that make a tweet more "retweetable." 

That said, I can tell you that without any of the fancy computer models or predictions. Just write something worth retweeting. 

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Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

The 30 Richest DJs

Who says you can't make money as a DJ? It seems like the stars of EDM far out-earn the rock stars of yesterday, and all without needing the major label infrastructure to promote them to boot.

Considering that the 7 biggest EDM clubs in Las Vegas average income was $625 million a year (according to Nightclub & Bar magazine), and many DJs now have sponsorship deals with major brands like Ralph Lauen and Sonos, you can see how the those at the top have become hot financial properties.

Here are the top 30 DJs with the highest net worth, according to celebritynetworth.com.

• #1: Tiesto – $75 million
• #2: Guy-Manuel de Homem-Christo (Daft Punk) – $60 million
• #3: Thomas Bangalter  (Daft Punk) - $60 million
• #4: Paul Oakenfold – $58 million
• #5: Paul van Dyk – $52 million
• #6: John Digweed – $45 million
• #7: Armin Van Buuren – $40 million
• #8: Judge Jules – $42 million
• #9: Sasha – $40 million
• #10: Pete Tong – $32 million
• #11: Moby – $30 million
• #12: David Guetta – $30 million
• #13: Steve Aoki – $28 million
• #14: Fatboy Slim – $23 million
• #15: The Chemical Brothers – $20 million
• #16: Ferry Corsten – $19 million
• #17: Deadmau5 – $18 million
• #18: Carl Cox – $16 million
• #19: Skrillex – $16 million
• #20: Benny Benassi – $15 million
• #21: DJ Pauly D – $15 million (Sad but true)
• #22: Sven Vath – $14 million
• #23: Jeffrey Sutorius (Dash Berlin) – $13.5 million
• #24: Calvin Harris – $13 million
• #25: Avicii – $12 million
• #26: Afrojack – $11 million
• #27: Kaskade – $10 million
• #28: Sebastian Ingrosso (Swedish House Mafia) – $10 million
• #29: Steve Angello (Swedish House Mafia) – $10 million
• #30: Axwell (Swedish House Mafia) – $10 million

For those of you who want to break out the turntables (or more appropriately, the computer) and get into the game, just remember that we may be seeing the absolute peak of the market here. I'm told by a friend who owns one of the world's biggest sound companies that EDM at the major European festivals is already somewhat passe this year, although EDM-only festivals remain hot. Any one care to speculate on the next trend?

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

A New Way To Distribute Music Digitally

If you want your music on iTunes, Spotify, and other digital services, most artists choose to use either Tunecore or CD Baby as a distribution method. Each have their upsides and downsides, with the downsides mostly being financial, with Tunecore charging a flat per year for each release and CD Baby taking a percentage of the sale. Now there may be a cheaper and easier way to do it, thanks to DistroKid.

DistroKid is an offshoot of Fandalism, the social network for musicians started by Philip Kaplan. What makes it different from most other distribution networks is that it costs only a subscription fee of $19.95 a year which allows unlimited uploads of your music. You can even upload one song for free before you enter any credit card information.

Kaplan started the service with an eye on democratizing music distribution even further than it currently is by making it a snap for anyone to release their music. While on the surface this seems like a noble idea, the big problem is that since there are really no record label gatekeepers to sift through the mediocre to find the brilliant, at least the service fees of Tunecore and CD Baby would make people think twice before they'd release something that might not be up to par.

The flip side of that coin is, who really knows what another person might like? Music history is filled with big hits that their writers, artists or record labels thought weren't very good and were later pleasantly surprised by the public's enthusiasm. The beauty of Music 3.0 is that if you look hard enough, you'll find at least a small audience for it somewhere. The downside is that it's hard for the consumer to sift through all the noise.

DistroKid is a boot-strap operation despite the earlier online successes of Kaplan (the ad network AdBrite and social shopping Blippy), so it's yet to be seen just how effective it will be in getting your music to all of the sites it claims. Plus, there's not a lot known about how the accounting is handled yet. That said, if you want to get your music on iTunes, Spotify, Google Play and Amazon in 2 to 4 hours (which is really fast), give it a try.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

Interested in the Music 3.0 archives? Buy The Music 3.0 Guide To Social Media for the best of over 800 posts.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Twitter's #Music New Chart Features

Although Twitter's #Music discovery service has gotten off to a somewhat shaky start (it was probably impossible to beat the expectations), it seems to be settling into its own comfortable groove. One thing that's important to fans and artists alike are charts, and #Music has finally included them, giving everyone a better idea not only of what's happening on Twitter but elsewhere as well.

#Music now provides 10 musical genre charts (from rock to country to hip-hop), but the 5 additional charts are the more interesting ones. These include Superstars, Popular, Emerging, Unearthed and Hunted. The Superstars and Popular charts show the songs that are currently trending on Twitter, while Emerging and Unearthed are truly for music discovery of new or lesser-known artists.

The most interesting chart of the bunch may be Hunted, which seems to be derived from We Are Hunted, the service that Twitter bought and turned into #Music. This chart actually looks at blogosphere to determine the listing, not just Twitter.

This service isn't catching on because it has limitations, since you need either a Rdio or Spotify subscription to listen to the song, or you can listen to 90 seconds from iTunes. That just isn't easy enough to use for most listeners who now have plenty of other choices that are much easier to get their music from. Too bad, because #Music could really be a boon to music discovery.

You can access the charts via the icon on the upper left corner of the #Music page.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

A New Revenue Stream For Musicians

While a Kickstarter or Indie Gogo campaign is all the rage for artists to fund a recording these days,  another twist on an old idea may give traditional crowdfunding a run for its money. A new site called Patreon, labeled as a "fundraising" site, allows fans to subscribe to the artists they follow and receive "patrons-only" streams of their work.

The brainchild of Pomplamoose's Jack Conte and AdWhirl founder Sam Yam, the site allows fans to perform the age-old function of patron. The difference from European royalty is that instead of a large lump sum bestowed upon the artist, each patron can contribute a small amount (think of it as a tip) every time the artist releases a piece of content. The content can be videos, songs, blogs, articles or recipes or anything other "art" that comes on a regular basis.

A patron receives more than the stream though, as they also have the ability to post in the artist's stream and can unlock additional patron packages like private Google+ Hangouts or tutorials with different levels of support.

It's a cool idea and just another way that an artist with a fanbase (that's the key here) can create a new income stream. Check out the video below for a more detailed description of Patreon.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

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Prince's New Record Deal

We tend to think of record labels not changing much even in the face of the major paradigm shift that is Music 3.0, but while that may hold true for the major labels, there are a few that are forward thinking. Take Kobalt Music, for instance, which is an independent publishing company that launched their version of a label last year with the idea of giving control back to the artist, allowing them to not only maintain ownership of their work, but when and how it's made available as well.

The latest to sign a deal with Kobalt is superstar Prince, who joins the likes of Dave Grohl, Paul McCartney, Dave Stewart and Eddie Veder (among others) who've decided that this is the way to go in the future. Of course Prince is all about control, even changing his name to that unpronounceable symbol in order to get out from under the clutches of his deal with Warner Bros.

One of the things that he gets in the new Kobalt deal is access to their new software that closely monitors the streaming world, thereby increasing the royalties. Every artist and songwriter is concerned about streaming and what it will do to their career, so any way to get a foot up is attractive, which is why Kobalt seems to be making the splash that it is at the moment.

It's still to be determined just how successful their software tools actually will be, but there's a lot of music heavyweights that are convinced that Kobalt has something they need. You'll hear more about them in the future.

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Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.