Updated: Jul 31, 2020
Music Publishing is the business associated with the part of music industry that deals with the composition, lyrics, structure and arrangement of a song.
The first music copyright is the composition copyright. This includes the copyright granted to the ideation of lyrics, composition, arrangement etc. This is the basic underlying copyright for any music since a track (form of a recorded music) cannot exist without the composition.
The owner of such copyright is known as an author, composer or lyricist. In many cases, there are multiple people contributing towards one song. And the copyright laws do not differentiate parts of a song separately. Hence the lyricist cannot just own the copyright of the lyrics of the song, or the composer cannot just own the copyright of the composition. Rather, all stakeholders share the ownership of the copyright together. Having said that, the concerned individuals can come to an agreement about who shares what percentage of the copyright (called writer-splits). Together, they will be known as co-writers of the song.
You are not alone when it comes to managing your composition business (Business -1). Individuals/ organisations such as Music Publishers provide their expertise in a lot of financial and creative aspects of the music industry (for a part of your royalty income).
Each co-writer may choose a different or the same publisher to work with. And the publisher earns out of the percentage of royalty income associated with you on the song. Some might also agree to charge you a monthly fee rather than part of royalties.
Synchronisation or Sync Rights (right to make your work available for a use in audio-visual presentation such as television, advertisement, movies etct song. Now, the song is available on any streaming platform as well as a CD/Vinyl. We both own the composition copyright (Business -1) to this song. We decided to split the ownership 50-50. So, I own 50% of the rights to the song and you own the other 50%. So, any royalties earned by the composition of this song will be divided equally between us. And our publishers (if any) will receive a percentage of our part of the song i.e. some percentage of 50% from you and some percentage of 50% from me. This percentage will be a negotiation between us and our publishers (will be laid down in the contract).
Every copyright law extends the following rights to the owner of a copyright (pertaining to the music industry):
Right to make copies of your work
Right to perform/ make available your work to the public
Right to choose who can use your work (This is how you earn royalties on your copyright: You provide a license to use your work to another party and they pay you for that use - either a flat fee or a percentage - based on the use of your work)
Note: There is an exception to this, when someone wants to make copies stat rate, Also note that in certain cases, these copyrights do not guarantee a royalty payment (when it serves good for the public's interest) such as use for pure academic purposes, Other than that, you enter into an agreement with the party interested to utilise your copyright.
These rights as above are known as the following in the music composition industry (with respect to Business -1):
Mechanical Rights (right to make copies of your work)
Public Performance or Performance Rights (right to make your work available to the public)
Synchronisation or Sync Rights (right to make your work available for a use in audio-visual presentation such as television, advertisement, movies etc.
With these rights, comes the revenues from use of your copyright, and they are known as the following:
Mechanicals or Mechanical Revenues (owing to the payment against Mechanical Rights i.e. use of the copyright to make copies)
Public Performance Revenues (owing to the payment against Performance Rights i.e. use of the copyright to make the work available to public)
Note: A sync deal results in sync revenues but they are directly negotiated (based on length, number of copies, regular payment in case of streaming etc.)
Tip: While understanding the kind of payments from a royalty source, revisit the above revenues and that will make it clearer to understand.
The following lists out varies sources of revenue for a composition:
CDs/ Vinyls (Physical recordings): Make a physical copy of the song (Require Mechanical licensing)
Radio/ live TV/ FM/ AM: Make the song available to end-consumers (Require Public Performance licensing)
Use in Advertisement/ movie/ games: Use parts of or whole song in conjunction with moving images (Require sync licensing) Note: Sync licensing is a one-time upfront payment for the use of a song in any case. When the ad/movie/game is being streamed, for example, the song also earns micro-payments pertaining to public performance of the track. Hence, a sync deal almost always turns into a performance revenue generation mechanism after the sync happens.
Ringtones: Make a copy of either composition or lyrics or both (Require. mechanical licensing)
Covers/ Internet videos: Make a copy of the song (Require mechanical licensing: although a fixed statutory rate is decided by the copyright office in this case, and hence, anyone can make covers of any song but the royalties from Business -1 go to the original writers)
Merchandise/ Karaoke/ Lyrics: Make a copy of a part of or whole song (Require mechanical licensing). Note: In case of merchandise, there might be a contract between parties and a pre-payment based on expected number of units etc.
Streaming (Interactive/ On-demand):
Live gigs/ Concerts/ Businesses playing live or recorded music:
Here’s how to do collect revenues from Business -1:
Either start your own publishing company (just on paper) or get into a publishing agreement with a publisher (More on this in a separate blog)
Get registered with either
a Mechanical Rights Organisation (MRO) and a Performance Rights Organisation (PRO); or
Collective Management Organisation (CMO)
Actively search for sync deals and collaborations