How Are They Related?
Independent musicians are turning more towards music streaming and licensing since the pandemic as a means to promote and expose their original copyrighted works. In addition, music streaming is developing into the primary way listeners consume music, and having your music showcased within those playlists is becoming increasingly important for success.
Music licensing companies and streaming platforms, while different, share a common desire for music artists. Being featured in a music library for licensing can allow music producers and supervisors to locate and license your music for their projects. Streaming platforms, in some cases, also need to have music licenses in place to stream.
To understand how musicians can utilize both streaming platforms and music licensing in their favor, they have to obtain a strong knowledge of what each entails. Then, they can develop networks and collect royalties for their compositions, and in some cases, sustain a long music career.
What is Music Licensing?
Music licensing allows someone else besides the publisher or composer of the music to use it legally while receiving royalties. The most common type of music licensing is known as sync licensing. Copyrighted materials need to have written permission or contracts from the author.
Musicians need to know that different types of music licenses can be utilized by a licensee. Some of these licenses include:
- Synchronization License: Also known as the “sync” license, grants permission for any producer or music supervisor who wants to use your musical recording in a media-type format, and you give them this permission to do so. These are most typically used in video streaming, where an image is displayed over the audio.
- Mechanical License: These are used more for covers of songs when a musician decides to record someone else’s music so that the original authors receive their royalties.
- Master License: A master license permits the use of a musical recording. For example, if the music is a cover of another song, the new master license references the song’s new recording instead of the original version.
- Public Performance License: A public performance license grants permission for a song to be performed in public, online, or on the radio. It is sometimes referred to as public performance rights or performing rights.
When agreeing to license your music for streaming, another aspect you must know is that two licenses must be acquired: the first is the music composition, which includes lyrics and melody, and the second is the publishing or master recording of that musical work.
Music licenses can be exclusive, which means that the licensee will be the only one using the music that is being purchased. Non-exclusive licenses, which are much more common, allow the musician to license a recording of a musical work multiple times over.
Music Streaming Needs Licenses
Music streaming comes into play because, in order to stream music, there need to be licenses in place. Therefore, music streaming services have to pay royalties to license the music to stream across their platform. There are multiple streaming services that need to pay out these royalties, including Spotify, Apple Music, YouTube, and more.
The types of licenses that are needed depending on the kind of streaming that is happening. Video streams are relatively common, but interactive and non-interactive audio streams need to have licenses, which would be mechanical and public performance licenses. Master licenses will also be necessary if any existing recording is being used.
Who is Responsible for Obtaining the Licenses for Streaming?
Video streams are usually not handled directly by the digital service provider. An example is YouTube – they pay royalties to some publishers that agree to a share of ad revenue in exchange for sync licensing to stream videos. However, most publishers do not agree to this method and require the individual using their music within their visual media to be the ones to obtain the correct licenses.
Streaming platforms like Spotify, Apple Music, or Bandcamp have divisions that handle the mechanical licensing for the streams. Because of this, they often elect to become a blanket licensee and pay royalties to the Mechanical Licensing Collective (MLC). However, not every streaming platform handles this method of licensing for you, the music artist.
For non-interactive audio streams that just use audio online, public performance licenses are required. In addition, musicians need to register their copyrighted music with a Performing Rights Organization (PRO), which helps to protect and collect the royalties and music licensing fees on behalf of the artist.
How do Licensing Agreements Help Artists Earn Money?
While the licenses and the contracts may seem complex, musicians must understand that there is room for negotiation. For example, you can negotiate the amount to be paid upfront, as can the one trying to obtain the licenses to use your musical works. Marmoset Music Licensing Agency shares that since 2010 they have paid their artists over $20M. With every license, the money goes right back into the artist community because their mission is to cultivate the creativity that each musician brings to their library which fairly maintains a balance for both artists and the production facility.
How music artists get paid is broke down like this:
- Exclusive License: For this license, you do not get any fees paid upfront. You are, however, sharing the rights to a pre-recorded master song or track with a streaming platform, and you get to keep all of your Writer’s share. In addition, in some cases, the streaming service may re-title your track so that they can claim money and allow you to preserve rights for the original master.
- Non-Exclusive License: The musician permits the use of the original music but can also have the ability to shop that same music in other locations or with other streaming platforms. The musician will retain Writer’s share and the agreed amount for the Publisher’s share.
- Partial Buy-Out: The music artist would receive an upfront fee to create music, a percentage of the sync fee, and all of the Writer’s share from the PRO. The “writer” refers to anyone who contributed to the lyrics or melody (typically, you as the musician), and the “Publisher” is anyone that might have the music copyrights for the recording.
Having a solid understanding and research allowing their music to be licensed for streaming purposes can bring independent artists substantial income. In addition, finding opportunities to submit music to companies, and publishers for their streaming platform also gives musicians opportunities to market and increase their exposure, reaching listeners who become interested and fans of their music.
If you are a musician and worry about the challenges of licensing for streaming, find some help with a music lawyer or someone who specializes in music licensing. The worst thing that could happen is that you do not have proper licenses in place, and either your music is used freely without reprimand, or you end up dealing with infringement of copyright suits.
