ARCHIVED NEWS

PMP Question:

On you're next PMP article, could you discuss publishing as it pertains to a producer?  From what I understand publishing income and backend royalties are not the same, is this correct?

I brought some issue's like this to my attorneys attention, we got into a debate on whether or not a producer gets any piece of the publishing because the producer did not write the "song" or the "underlying melody"... but I have always heard that we do get a piece of the publishing, at least 50 percent?  All this is really confusing lol.  If you could touch on this in your next feature that would be great!

Bernie's Response:

Publishing income and backend royalties are two separate revenue streams.  Music Publishing is the commercial exploitation of copyrights through various forms of licensing.   Publishing income (referred to as mechanical royalties) flows from various forms of licensing including but not limited to the following: 1) mechanical licensing (granted to a third party who is interested in recording or distributing the song); 2) compulsory mechanical licensing (allows any third party to record and distribute a commercially released song, without requesting permission from the publisher, as long as such third party pays to the copyright owner the mechanical licensing rates established by the copyright laws); 3) synchronization licensing (covers the use of a song with visual images(i.e. videos)); 4) performance licensing (a blanket license offered by performing rights organizations (i.e. ASCAP, BMI, SESAC) to venues and businesses for the public performance of a song); and 5) licensing of print music (income generated from the sale of sheet music). 

In the hip-hop genre, the term "producer" is sometimes incorrectly used interchangeably with "composer" or "writer."  The reality is, just because you create a track, does not mean you are the producer.  In other words, a person who creates a beat owns publishing in the track and will be entitled to mechanical or publishing royalties, hence a copyright owner. If another person steps in and adds an underlying melody to the same track, he too will own publishing in the track, but may arguably claim to be the producer, if he was responsible for the arrangement and mixing of the recording.  Such persons classified as the producer will be entitled to both publishing royalties and producer (backend) royalties.  In the event that the latter of the two persons was only responsible for the arrangement and mixing of the recording, he would not be considered a writer of the track and would only be entitled to producer royalties for his services.  The general rule of thumb is, unless otherwise agreed, ownership in a musical composition is split 50/50 between the person writing (composing) the music and the person writing the lyrics and the melody. 

As a side note, music producers may also receive royalties from digital performance licensing (royalties payable by Sound Exchange to the copyright owner of a sound recording and to the featured performers on the recording for digital transmissions (.i.e. satellite radio and internet radio).  It is important to note that music producers are entitled to digital performance royalties only if they are considered a featured performer by the artist on the project.  The caveat is the artist must agree by signing a letter of direction (LOD) that reflects the royalty percentage the producer is entitled to receive and submit it to Sound Exchange. To ensure that this occurs, verify that a Sound Exchange LOD (separate and apart from the standard LOD that is sent to the record labels) signed by the artist is attached to the Producer Agreement. Check out http://www.soundexchange.com/ for further information regarding the sample letter of direction.

In summary, if a producer did not write any part of a musical track, he will not own any publishing in the composition and, thus will not be entitled to publishing (mechanical) royalties.  However, he will be entitled to record royalties for his services as a producer, payable from the sales of the recording, which is separate and apart from mechanical royalties. Conversely, a person who contributes both writer and producer services is entitled to publishing and (back end) producer royalties.  As you can see, publishing is the backbone of the music industry.  Understanding what publishing is and how it works is essential to "getting paid" in the music business. 

. 
. Disclaimer: The content of this article is the express opinion of Bernie Lawrence-Watkins and shall not to be construed as legal advice or in any way create an attorney-client relationship.

PMP producers send all questions to support@pmpworldwide.com (Not to Bernie!)


B. Lawrence Watkins & Associates P.C