Survey passman chap 17

1. Chapter 17
Secondary Publishing Income

2. Printed Music
• Most print music revenue comes from:
• Sheet music – printed music of a single song
• Folios – collections of songs
• Matching folio – all the songs on a particular
album
• Mixed folio – collection of songs by different
artists
• Personality folio – has artist’s picture all over it
• *Matching folios are also personality folios

3. Royalties on Printed Music
• Publisher’s share of physical (on paper) print rights:
• For single-song sheet music: 20% of marked
retail price.
• Typical retail price: $4.95; publisher gets about 99¢
• For folios: 10% -12.5% of marked retail price.
• Typical marked retail price of folios is $24.95
• Personality folios have additional 5% royalty of the
marked retail price that goes to the artist for use of
name and likeness.

4. Print Music Royalties
• Rest of print revenue comes from instructional music, marching
band and orchestral arrangements, dance arrangements, etc.
• Royalty for these uses is typically 10% of the retail price.
• Print rights include reprints of lyrics in books, magazines,
greeting cards, billboards, etc.
• Books typically pay 1¢ per unit; $200 minimum.
• Advertising uses pay flat fees; can be up to $25,000 for major
uses.
• Lyrics on albums is typically free.

5. Term
• Typically, print rights exclusive for period of three to
five years
• After term expires, printer can sell existing inventory for
six to 12 months after the end of the term
• Must destroy everything left over after that.
• Print deals should prohibit printer from:
• Stockpiling – printing lots of copies right before end of term
• Dumping – selling off inventory at less than wholesale

6. Digital Print Rights
• Publishers get (split) 50% of ad revenue from
websites posting lyrics to songs.
• E-cards: publisher gets greater of 10-15¢ per unit
or 5%-8% of retail price.
• Downloadable sheet music – publishers get
50% of typical $4.95 revenue; more than print!
(20%)
• Digital deals are nonexclusive – publisher can
license rights to multiple users.

7. Synchronization and Transcription Licenses
• Synchronization license or “synch” license
• Pronounced “sink”
• Synch license is license to use music in
“timed synchronization” with visual images.
• Motion pictures, TV shows, TV commercials,
home video devices, etc.
• Radio commercials – no images, so license is
called a transcription license.

8. Fees for Synch Licenses
• Motion pictures:
• Major studios – typically run $15,000 to
$100,000; buys out all rights in perpetuity.
• Fees are higher if used in trailers and ads.
• Main title uses (opening credits) run $50,000 to
$250,000
• End titles - $35,000 to $100,000. Why less?
• Will be less if more than one song over end
credits
• If studio really wants a hot, recent hit song, fees
can get well into six figures.

9. Fees for Synch Licenses
• Previous quotes include in-context
advertising and trailers for the film.
• In-context means that the song is used
in exactly the same way it’s used in the
film.
• i.e. – same song, same scene used in TV
ad
• Trailer – “preview of coming attractions”
online and in the theater.

10. Fees for Synch Licenses
• Out-of-context use – song is used differently
than in the film
• Song is used over different scene in same film in
trailers, ads, etc.
• Any use other than the original use in film is
considered out-of-context
• Pays much more money because they’re
using song like a commercial.
• How much? $20,000 for instrumental cues;
songs get from $25,000 to $250,000 more!

11. Independent Films
• Step deals – money for song use comes in
steps
• Say, initial fee of $2,500 plus another $2,500 when
film released to home video.
• “Kickers” – additional fees for certain benchmark
successes. Say, additional fee at over $3,000,000
box office gross.
• Can give film company limited rights for showing
at film festivals, then make them do a market-rate
license if they sell the film.

12. Television
• Due to new and emerging technologies, most TV
license are in perpetuity.
• Include all rights now and hereafter known.
• Can get from $10,000 to $50,000 plus depending
on popularity of song.
• Indie artists can gain great exposure by getting their
song on a TV show; often licensing their song at a
very cheap rate ($1,000 or less).
• Only uses not covered by these licenses (for which
you can get more money) are for out-of-context ads.
• Can typically get additional $1,500 to $5,000 per
week while out-of-context promotion runs.

13. Television
• Commercials:
• Songs can get from $50,000 to $200,000
for one-year national usage in the U.S.
on TV and radio. 
• Really well-known and classic songs can
get over $1,000,000!
• Current trend is downward 
• Prices scaled down for regional or local
usages
• Periods of less than one year

14. Video Games
• Video games don’t typically pay royalties
• They typically pay flat fees
• Fees can be from nothing up to $50,000 for a
major hit.
• Typical video game fee is around $8,000 to
$10,000 for use in perpetuity.
• Only exception to royalties are song-centered
games like Guitar Hero and Rock Band. Pays a
fraction of mechanical rate and there’s usually an
advance.

15. Electronic Transmissions
• Untethered Downloads
• Typical iTunes-type unrestricted download
• Treated just like sales of CDs
• Copyright owners get full mechanical royalty
rate 
• Ringtones/ring backs – copyright owners get
mechanical royalty of 24¢

16. Noninteractive Streaming
• Noninteractive means you hear what someone
else decides to play
• Essentially a radio station that’s not over-the-air.
• Publisher only gets performance monies just
like if a radio station played the song.
• Rates are a percentage of revenue, with
minimums.

17. Interactive Streaming
• Interactive streaming – streaming on demand
• Examples: Napster, Rhapsody, MySpace, Yahoo!
• Rate is the greater of:
• 10.5 % of subscription fees or 10.5% of ad
revenue
• If record company pays publisher: 17% to 18% of the
monies paid to the record company for masters and
publishing combined.
• If streaming service pays publisher: 21-22% of
money paid to record company for masters alone
• 15¢ to 50¢ per subscriber, per month

18. Foreign Subpublishing
• U.S. publishers make deals with local publishers in
each territory – local publisher is called a
subpublisher
• In most foreign territories, there is a mandatory
mechanical rights collection society; usually government
owned
• Society collects money, keeps it, makes interest on
it, then distributes it to the appropriate publishers.
• Remember – it’s the entire album that’s licensed; not
individual songs. Rate is a percentage of wholesale price
divided among all songs on the album.

19. Foreign Performances
• All foreign territories have some sort of performance
rights society.
• Usually only one per country and usually government
owned.
• These societies pay the publishers share of
performance monies to the local subpublisher, and
the writer’s share directly to ASCAP, BMI, and
SESAC.
• Takes much longer for U.S. publisher to get money if
there is no foreign subpublisher.

20. Subpublisher Charges
• Typical subpublisher deal is is from 15% to
25% of monies earned.
• Contracts read that the subpublisher collects
the money then ‘remits’ 75% to 85% to the U.S.
publisher.
• Referred to as 75/25 or 85/15 deals.

21. Advances
• Customary for subpublishers to pay U.S. publishers an
advance on future earnings.
• Can be from zero to millions of dollars for major
catalogs in major territories.
• Advance based on a percentage of historical earnings
• A deal with no advance is called a collection deal
• Subpublisher merely collects money on behalf of U.S.
publisher.
• Percentage usually lower: 10% to 15%

22. DART Monies
• DART - Digital Audio Recorders and Tape act
• Congress passed Audio Home Recording Act of 1992, included
DART.
• Act said that:
• Consumers who copy records at home for their own private,
non-commercial use are not committing copyright infringement
• Imposed a tax on digital audio recorders and digital audio tape.
• Didn’t include computers!
• DART monies get paid to record companies, featured
artists, publishers, songwriters, and unions.

23. Secondary Publishing
Income
• Questions?