Knowledge Bank: Make Money

Frontline artists have three main ways of making money.

They create and exploit intellectual property – usually the copyright in songs and recordings. They also create and monetise visual works by selling merchandise, and may build and trademark a brand.

They stage and monetise live performance – both staging their own shows or being booked to play other shows, including support slots, festivals, brand events and private parties.

They build a fan relationship and then monetise that relationship by offering the core fanbase enhanced products and experiences.


MEET THE MUSIC INDUSTRY
The music industry consists of individuals and companies who help music-makers make money from their music. Most people working in the music industry specialise on one of the three revenue streams.

There are those people and companies who work with music-makers on their intellectual property. This includes record labels, music distributors, music publishers, collecting societies like PRS and PPL, recording studios, marketing agencies, and companies that manfuacture CDs and vinyl.

There are those people and companies who work with music-makers on their live performance. This includes booking agents, concert promoters, venues, ticket agents, and people involved in managing tours and doing the production on shows, festivals and other events.

There are those people who work with music-makers on their fan relationship. This includes the digital platforms used to engage a fanbase and people involved in delivering direct-to-fan campaigns.

Frontline artists also run their own businesses and usually hire a manager – or management team – to help them manage that business day-to-day. They’ll also usually hire a lawyer and accountant.


RESOURCES
Each strand of the music industry has an organisation representing the people and companies who work in that area of the business. These are a good starting point for navigating each strand – both for artists considering future business partners and for people who want to work for music companies.

Record LabelsBritish Phonographic Industry (BPI)
Record LabelsAssociation Of Independent Music (AIM)
Music PublishersMusic Publishers Association (MPA)
Booking AgentsThe Entertainment Agents Association
Concert PromotersConcert Promoters Association (CPA)
Concert PromotersAssociation Of Independent Promoters (AIP)
Music FestivalsAssociation Of Independent Festivals (AIF)
Grassroots VenuesMusic Venue Trust (MVT)
Concert HallsBritish Association Of Concert Halls (BACH)
ArenasNational Arena Association (NAA)
Ticket AgentsSociety Of Ticket Agents & Retailers (STAR)
Concert ProductionProduction Services Association (PSA)
Lights + SoundProfessional Lighting & Sound Association (PLASA)
Artist ManagersMusic Managers Forum (MMF)

The organisations focused on intellectual property come together via another organisation called UK Music.

The organisations focused on live performance come together via another organisation called LIVE.


UNDERSTANDING MUSIC COPYRIGHT
Copyright is a legal concept that gives creators control over the outputs of their creativity – so when someone creates a song, a recording, a film, a photo, an illustration, an article, a novel, a script, etc, they have control over what happens to that work.

When we talk about music copyright, we are usually talking about two distinct sets of copyright…

SONG RIGHTS: Every time you write some original lyrics you create a copyright – a literary work. Every time you compose some original music you create a copyright – a musical work. These together form the song rights – ie the copyright in the song. In the music industry we sometimes call these the author rights or publishing rights.

RECORDING RIGHTS: Every time you record a track you create a separate copyright – a sound recording These are the recording rights – ie the copyright in the recording. In the music industry we sometimes call these the phonographic rights or master rights.


MAKING MONEY FROM COPYRIGHT
Copyright owners have control over their work in a number of different ways.

That includes the reproduction, distribution, rental, adaptation, public performance, communication and making available of the work. If any one else wants to do any of those things with the music, they need to get the copyright owner’s permission.

The copyright owner would usually charge for this permission. And that’s how copyright makes money. This charging for permission is called licensing.


COPYRIGHT OWNERSHIP
Copyright is automatic. As soon as you write an original song – you create a song copyright. As soon as you record a track – you create a recording copyright. All you have to do is make sure that the work is fixed. So, that means it is written down or recorded. But how do we know who owns each copyright?

The law provides us with default ownership rules – so we know who the first owner of any new copyright is. With songs – the default first owner is whoever writes the song. With recordings – it is whoever organises and/or pays for a recording to take place. If more than one person is involved in writing a song or organising a recording session they co-own the resulting copyright.

Although we have these default rules, whenever music-makers collaborate on writing a song or recording a track they should reach an agreement about copyright ownership – so there is no confusion regarding who owns the rights. So, identify what copyrights have been created, agree who owns each copyright, and if they are co-owned how they are being shared out in percentage terms.

Whatever is agreed needs to be written down and logged with the music industry’s databases. These are managed by the collecting societies – songs should be logged with PRS and recordings should be logged with PPL. If a music-maker has business partners they will probably do this, but where a music-maker has no business partners, they need to do this themselves.


RESOURCES
For more information on music copyright, access the free Music Copyright Explained guide – produced by CMU and the UK’s Intellectual Property Office – at musiccopyrightexplained.com


Pathways Into Music

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