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Music Marketing

Posted By Musician Coaching on July 6th, 2013

A blog for musicians and music industry people. It is a free educational resource and it is also the way I advertise my music consulting services. I am an entertainment professional with deep roots in the music industry. Throughout my music career I have been a major label A&R representative, a music supervisor, an artist manager, a reality show producer, a bass player and the head of a digital record label.

 

Do I need to license a cover song if I give it away?

Posted By Musician Coaching on May 23rd, 2011   
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I got asked this the other day and I didn’t know the answer.

I happened to be chatting with my friend Barry Heyman who was kind enough to answer the question for me.  Barry is an entertainment attorney with a focus in the areas of entertainment, intellectual property (copyrights and trademarks), and new media law.

 

Barry has worked in the Copyright Administration department at PolyGram and Universal Records and was in-house counsel for Eagle Rock Entertainment (producer, publisher, and distributor of music programming for television and DVD, comprising live concerts and documentaries).  He has also consulted clients such as MTV and Razorfish.  Barry currently runs his own practice out of New York and was an adjunct professor at NYU where he taught a graduate course entitled Law and the Music Industry.


Music Consultant:

Barry- thanks for taking the time to answer this.  Tell me what the legal ramifications are for recording a cover song and then giving it away free for promotion to promote the artist who covered the song?  Do artists need to license the song to do this legally?

BH:

Recording a cover song can be a great marketing tool—providing artistic interpretation on a song that your audience may already be familiar with. A cover can also bring notoriety to your art from people who were previously unfamiliar with your work. However there are legal implications to covering a song even if you are giving it away for free.

 

Let’s begin with the basics. A song has two copyrights: the sound recording (often called the master) and underlying musical composition. Recording a cover song implicates the latter of these copyrights—the underlying musical composition. The composer and/or songwriter is the copyright owner of song. The Copyright Act lays out certain exclusive rights that the copyright owner has with respect to their copyrighted material, such as the exclusive rights to manufacture and distribute the musical composition. In order for an artist to not violate the copyright law, the artist covering the musical composition with the intent of manufacturing and distributing it would need to obtain the proper license from the owner, usually the songwriter or the songwriter’s publisher (either directly or through an agent).

 

Even if  an artist is giving away the song for promotional purposes, the song still needs to be licensed.  The type of license required to record a cover version is called a mechanical license which allows an artist to use a copyrighted musical compositions on different formats, such as CD and as a digital download.

 

Typically, cover songs are licensed with the songwriter(s)’ publisher(s). Publisher contact information can be found at the following performance rights organization websites ASCAP, BMI, and SESAC or with The Harry Fox Agency, a licensing agent used by many music publishers.  In addition to licensing directly with the songwriter(s), the publisher(s), or The Harry Fox Agency, another option is using the licensing service, Limelight.

 

There is a license fee (royalty) associated with licensing and using the composition.  This is called a statutory mechanical royalty rate. This Federal rate is currently set at $.091 for songs 5 minutes or less in timing, and payable per song for each unit distributed. For recordings given away as promotional products, it is not uncommon to try and negotiate a reduced rate (e.g., 75% of the Statutory rate), or even gratis (free), however the copyright owner is not required to grant it.

 

Now, if the artist/band wants to create a promotional music video based on the cover song, this requires license(s) as well, except that the license required is called a synchronization license.  The statutory rate does not apply, as the license fee would need to be negotiated with the copyright owner in all instances. A couple of factors affecting video synchronization rates include the nature of the use, for example, promotional versus commercial use, and the length of use.

For more information regarding synchronization licensing, you can read an article Barry wrote here and be sure to check out his website at Heylaw.com

 

 

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13 Responses to “Do I need to license a cover song if I give it away?”

Mart Anthony

Interesting – I never knew a royalty had to be paid on each unit distributed. What implications would this have for artists who cover a song but make it available via streaming only? My first thought would be that, as technically no ‘unit’ is being distributed, the royalty would not need to be paid. Is there a different licence for covered songs that intend to be streamed, or is this a loophole that could be exploited?

Musician Coaching

I can tell you that there are very few large loopholes like that available to artists… I’ve asked some friends more knowledgeable than I to chime in here. The short answer is yes you need a license for the use you describe (legally).

Laura at SoundExchange

Mr. Anthony –

When you share a sound recording or composition in any form, paid or unpaid, commercial or promotional, digital, physical, or download, you need obtain a license and pay royalties. The good news is that composers, songwriters, and publishers are bound by a compulsory license, so you can get permission to stream or sell a cover song without directly negotiating with the songwriter. Online licensing systems like Limelight can streamline the process significantly. Be aware, though, that even a cover song that has a proper license through Limelight or Harry Fox may not be eligible for all types of services. Bandcamp, for example, specifies that no cover songs should be uploaded there. The exception, if you’re looking for work you can use without paying a licensing fee, is work in the public domain. You should look up any song you’re interested in to verify its status, but loosely, this would be compositions from before 1923: most traditional hymns, patriotic anthems, and a few earlier popular standards.

You should know, though, that just like songwriters have a right to be paid for distribution of their work, no matter the medium, recording artists also have that right in many cases. If your sound recording (cover song or original work) is being streamed on internet radio, satellite radio, cable TV music channels, you’re entitled to royalties, too. Those are the rights we cover here at SoundExchange, and we encourage you to find out whether you might be accruing these royalties. We have millions of dollars in unclaimed royalties for thousands of artists who haven’t yet signed up with us. It’s free, and there’s no catch. http://www.soundexchange.com

So in short, yes, you have to pay a statutory royalty rate to use a songwriter’s work to record your own version. But once your version is out in the world, you’ll earn royalties for it, too.

I hope this has helped to clear things up. Best of luck with your recordings.

Laura Anderson at SoundExchange.

Vincent S. Castellucci

As the former head of the Harry Fox Agency’s licensing division, I have my comments regarding if and when to obtain permission (license) of a song not written by the new “artist” who is recording the song as a “cover” whether for free or for sale in the USA.
There are many variation to the rights that are involved and the exceptions therein.
In short if I were to make a cover of “X Song” written and made available by the Allman Brothers on their commercially released record, and I was to record anew the song onto my CD, then yes permission from the music publisher would be in order or through their licensing representative.
The “mechanical” license can be easily obtained through the HFA web site for a limited number of CD’s one is preparing on making.
Again there are exceptions to the rule and each country’s PRO organization has their own set peramters as well.
If you are making the song available over the net for downloading or streaming (world wide)then another set of requirements need to be addressed.
As each circumstance might be different, please feel free to ask the question on this blog and I will do my best to answer you accordingly.
The licensing specific to this case is quite simple and I handle maters of this nature every day so ask away!
All my best to STM and kind regards to all,
Vincent

Mart Anthony

Many thanks all for your responses! This was more of a hypothetical / information-gathering question than something I intend to do, though the feedback is greatly appreciated nonetheless.

Laura I’ve been aware of SoundExchange for a while now; it’s not available in the UK from what I can tell, though I could have sworn I noticed a blog post a short while back that mentioned plans to roll out SOundExchange into Europe. Is that true, or am I imagining things?

Great blog by the way, Rick! It’s great to see people in the industry contributing to these discussions.

Laura at SoundExchange

SoundExchange covers digital performances streamed inside or into the United States (that is, the listener is in the US.) We compensate artists and labels from all over the world. In the UK, we exchange royalties through our sister organization, PPL. So if you’re signed up with them, you’re signed up with us. If you live in a locality without a PRO, or the PRO doesn’t have such a framework in place with SoundExchange, any artist or label from any country may register with SoundExchange directly. More specifics here: http://soundexchange.com/2010/01/25/non-us-artists-how-to-get-royalties-from-sx

Alex Holz

Some great feedback here — wanted to chime in with some additional points:

A license is required for interactive streaming that is based on a fairly complicated formula relating to a percentage of site revenues with a portion of that pool split between performance/mechanical.

It’s included as a configuration option in Limelight – http://www.songclearance.com (physical, digital, ringtone, interactive stream), and we charge 1 cent per stream via Limelight (as does HFA) because this will more than cover the fractions of a penny/stream that even a robust site would generate. The mechanical for interactive streaming may be covered by many online music services that are using an artist/distributors content but it depends on the agreement/deal structure between the artist/label/distributor and online music service. Many Limelight users buy this license for their own site interactive streaming capabilities.

@Laura, we’re fans of SoundExchange and even wrote an article focused on how to make money from cover songs via SoundExchange (http://www.songclearance.com/blog/cash-for-covers-make-money-licensing-covers-for-film-tv-and-ads-and-collecting-performance-royalties).

@Mart: you may want to check out PPL for something similar to SoundExchange in the UK (http://www.ppluk.com/en/Performers/Joining-PPL/Why-Join-Us/).

Terence Blacker

What’s the situation if you’re taking a copyrighted melody and are putting your own lyrics to it? Is there a different scale of permission fees?

Adam at HFA

Great interview–thanks for posting it. To respond to Mart’s question: In the physical world, it’s easy to understand ‘units’ as physical CD’s, cassettes, or LP’s. Because of developments in copyright law, mechanical rights also apply to permanent digital downloads, interactive streams and ringtones. Each digital download and each stream is considered a ‘unit.’ If you are making your recording available on CD’s, downloads, and streams, you’ll need separate licenses for each configuration. HFA now makes it easy for individuals to obtain licenses for interactive streams, a service that was previously only available to large digital music providers. You can obtain mechanical licenses for streams, ringtones, downloads, and physical product using HFA Songfile at http://www.songfile.com. Users of Songfile can pay by credit card and licenses are automatically emailed to you. If you have questions about licensing, please feel free to contact us at publisherservices@harryfox.com.

Alex Holz

@Terence,

In that particular case you would actually need to secure direct permission from the music publisher as it would constitute a derivative work.

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