Before you lament all of the changes or fear the demise of the traditional business, hold onto your hat because the future of licensing looks bright.
The opportunities for artists to get their songs placed on other outlets such as television, film, and video games are exponentially increasing. TV and film license fees have been decreasing and video games are allowing artists to make up for that loss. Video games are giving artists what’s known as performance-based royalties, which allow them to reach a new type of audience.
How does this impact the ever growing and evolving Internet?
Internet outlets are getting smarter! They’re creating exclusive content and licensing music for only online usage. Artists can now have their songs placed on everything from a Hulu original series to a series on Netflix. It used to be extremely difficult for new artists to get placements on TV/film. Now with all these new outlets, artists have many more opportunities to get heard and seen.
And when you speak about online content, you must bring YouTube into the conversation.
Will it remain an outlet for fly by night, flavor of the moment quasi-stars to reach critical acclaim, or is the future of TV at stake? YouTube is undergoing a giant makeover within the next few years as premium content and niche channels are about to take over. YouTube has the potential to become the go-to platform for building business media in the future. They aim to develop channels that are topic specific and interactive — meaning viewers will get exactly what they want. The company has already invested 100 million dollars in developing premium channels that range from education to fashion.
What does this mean for you?
Put down the guitar for a minute and get your fingers working on the computer to develop lists of outlets, shows, gaming properties and online networks to pitch music to. Unsigned, up-and-coming acts regularly get placements on networks programs these days and that trend is going to continue. Make music licensing a centerpiece of your story.
“Passive income” is the term financial coaches and other moola-savvy folks use to describe the income that grows over time or continues to come in without you having to do any additional work. Sounds good, right? Royalties from a music placement in a TV show are one example. In fact, royalties are the best source of passive income a musician can hope for. Sure, you can sell CDs and tickets to shows and get some quick cash. But making the CD work long-term is the goal of licensing and publishing. Also, co-writing with others who will be selling their music, can be a fruitful source of passive income. One co-writing session and years of radio and sync fees could be headed your way. For now though, lets focus on licensing.
Understand what it’s all about
In a nutshell, the way music licensing works is you send your music to a publishing company, music library, or film / TV show itself for consideration. Make sure that your music is copyrighted and registered with a Performing Rights Organization (PRO) like ASCAP, BMI or SESAC.
It’s important to understand how you get paid from your music being placed in any form of media. From there, you can figure out which avenue you’d like to pursue. Figuring out all the different ways to get paid has taken me years. The main points to understand are:
- The difference between publisher’s share and writer’s share
- What master, mechanical, and sync licenses are referring to
- Who pays what, and how you get your cash