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The Secret to Licensing Your Music

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By: Erin M. Jacobson, Esq.

This article was previously published on Synchtank.com.

Licensing music is one of the more lucrative areas of the music business and I often get asked how one can encourage productions to license one’s music. 

There are many factors that go into choosing a piece of music to license.  For example, some creative factors include the song itself, the genre, the artist who recorded the particular song, the time period from which the music is from, the nature of the scene or commercial that is using the music, the product, the mood that the producers want to evoke, and other factors.  From a legal perspective, factors that can influence whether a piece of music is licensed include the territory in which the music is available to be licensed, the length of time the music will be used, in which media the music will be used, whether promotional uses are allowed and what type, and more.

However, there is one factor that when all other things remain equal could win the license for one piece of music over another.

Without further ado, the secret to getting music licensed is…

Make the music easy to license!

Note that just because one’s music is easy to license does not guarantee someone will license it.  However, what it does mean is that if a production is interested in licensing a particular piece of music that proves difficult and time-consuming to license, the production will very often abandon efforts to try to license the difficult piece of music and re-direct its efforts to another piece of music that is easier to license.  This means that the owner of the piece of music that is difficult to license will lose that license and the income generated from it, and another rights’ owner now has an opportunity to get that license, and the income from it.

Here are some examples I’ve encountered where the music was not easy to license:

In one example, a new artist wanted a synchronization license for his cover version of a particular song.  There were two writers of the composition, and two publishers from whom to seek a license.  One publisher (“Publisher 1”), a major publisher, was responsive and regularly communicated in regard to approval status.  The other publisher (“Publisher 2”), a lesser-known indie publisher who actually has a catalogue of some substantial songs, was completely non-responsive.  This publisher ignored multiple emails and voicemails with the license request, including ignoring communication from Publisher 1, its co-publisher. 

I am a big fan of publishers in general, and especially those that do their job well.  However, in this case, Publisher 2 was actually losing a license for its writer by completely ignoring the license requests.  It stands to reason that if Publisher 2 ignored the request in this example, it is very likely that Publisher 2 has ignored other requests as well.  This means that Publisher 2 is actively losing money for its writer, and also creating a reputation whereby potential licensees will purposely avoid using songs administered by Publisher 2 because of Publisher 2’s difficulty.  This, in turn, will lose even more future licenses and money for both Publisher 2 and its writer. 

In another example, a successful podcast wanted to license a particular song for its intro and outro music.  The publisher responded quickly with a reasonable quote.  The master owner was in Europe and I contacted the office in the appropriate country.  That office advised me to contact and obtain the license through a particular society.  This procedure didn’t sound correct to me, but I contacted the society per the label’s request.  After several attempts at obtaining a response from this particular society, the society informed me that the society only licenses for its particular country, and only for a podcaster’s own website, not for the major podcast distribution channels like iTunes.  As this confirmed my appraisal of the situation, I contacted the label again with this information.  As of the date of this writing, the label has not responded.

A third example involves clearing music for a video game on a past project.  One particular composition was identified as being owned by a particular company.  After contacting the company several times and the company initially confirming it could issue the license, the company then said it could not issue a worldwide license, as it turns out it was only the sub-publisher for a particular territory.  Our team then asked this company to direct us to the company that could issue the worldwide license.  The sub-publisher’s response was “we don’t know.”  A sub-publisher is responsible for accounting to the rights’ owner that is the main publisher, who in this case would be the company able to issue the worldwide license.  The sub-publisher seemingly did not know who they were representing or to which company they were accounting!  Thankfully, there was a happy ending as we independently found the worldwide licensor and licensed the song.

In order to avoid making the same mistakes as the rights’ owners described above, here are a few tips to make music easy (or easier) to license:

  1. Make sure the registration data is correct in all places where someone would seek information for the licensing contact.
  2. Have a one-stop license, if possible.   A one-stop availability means a person or company owns or has the right to license both the composition and master.  This is not always possible, especially with major releases, so in that case, see #3.
  3. Know who the proper licensing parties are (including co-owners) and be able to assist in the process, if needed.
  4. Respond to license requests!

While the four steps outlined above cannot ensure a particular piece of music will be chosen from a creative standpoint, they will assist in the licensing process when the creative interest is already present.  Licensing is a very active area and it is possible to stay in and win at the licensing game if you play it correctly.

Note: This article does not constitute legal advice.

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WILL CALIFORNIA’S MUSIC INDUSTRY SURVIVE AB5?

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By: Erin M. Jacobson, Esq.

This article was previously published on Synchtank.com.

The music industry is comprised of very specific customs and practices as to how business is done. The music industry functions in its own world, and its customs and practices are foreign to and widely misunderstood by most people not working in the music business. Therefore, when those outside the music industry place restrictions on how music’s business can be carried out, the results can be disastrous.

Case in point, the new AB5 law in California. AB5 stands for Assembly Bill 5. It was introduced at the end of 2019 and went into effect on January 1, 2020. While this is a California law, it can affect the music business on a global scale.

Summary of the Law

AB5 was enacted with the aim of equalizing benefits and fair treatment for workers, especially those with part-time gigs, like Uber drivers. The intention of the bill was to make sure these types of workers also received the benefits of full-time employees, such as health care, and also to enforce businesses to pay employment taxes to the state instead of circumventing those taxes by classifying all of its workers as independent contractors.

AB5 takes the decision of a recent California Supreme Court case [1] and enacts it into law. AB5 dictates a new test for determining who is an employee versus who is an independent contractor. The determination of whether a worker is an independent contractor is now subject to what is called the “ABC Test”. In order for a person to be considered an independent contractor rather than an employee, the hiring entity must show all of the following:

  1. The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact. [2]
  2. The person performs work that is outside the usual course of the hiring entity’s business. [3]
  3. The person is customarily engaged in an independently established trade, occupation, or business of the same nature that is involved in the work performed. [4]

Here’s the translation in plain English:

Part A basically means that the worker is hired for a job and determines how he or she will do the work. This has to be shown in the written agreement between the hiring entity and the worker, and also has to be true in practice. For example, when one hires a bookkeeper, the bookkeeper will determine when and how he or she works, and how the work gets done. This will also be reflected in the agreement between the hiring entity and the bookkeeper. The hiring person is not going to tell the bookkeeper how to perform the work of a bookkeeper, nor is one business owner going to tell another business owner how and when to conduct business.

Part B means that the worker is performing work that is not the same business as the hiring entity. Again, using the bookkeeper example, if a musician hires a bookkeeper, the bookkeeper does very different work than the musician.

Part C means that the worker has his or her own separate business doing the type of work the hiring entity hired the worker to perform. Staying with the bookkeeper example, the bookkeeper would have his or her own bookkeeping business and perform bookkeeping work for other clients.

By default, workers are now considered employees unless the hiring entity can show the worker is an independent contractor. There are many exceptions to this rule, such as doctors, lawyers, accountants, graphic designers, repossession people, and more. However, there was no exception granted for those who work in the music business.

How Does This Affect the Music Industry?

Because there is no exception for the music industry, music professionals are subject to this law.

This means that a musician is now an employer when he/she hires:

  • another musician to play in that musician’s band (even if it’s just for one show instead of an on-going arrangement);
  • someone to perform on a record (even as a one-off, work for hire session);
  • a producer (or beatmaker) for their record
  • and more!

If that musician is an employer, then he or she would be required to take out withholding tax from the workers’ pay, pay payroll taxes to the state, potentially provide health care benefits, file all appropriate tax forms, etc. This could be crippling to independent musicians, both financially and administratively.

What About Companies?

Companies are not exempt from these requirements either. By contract and in practice, artists have always been considered independent contractors in relation to record labels, and this practice continues today. Songwriters have been considered independent contractors to music publishers, as composers have been to music libraries. This could all potentially change if AB5 is enforced based on a literal interpretation of the ABC Test. It could force companies to completely change the way they do business, which may be at the detriment of musicians. It is possible that companies like record labels will make sure their contracts are issued only from their offices outside of California.

It also may force many in the music industry to move their business outside of California where the “gig” way of doing business continues. This would be a blow to the California economy both from losing the revenue from the music industry, as well as the taxes from all the musicians and companies that would move out of California to continue their current ways of doing business.  AB5 may also affect independent film companies and non-union film projects. As the California economy relies heavily on the entertainment industry, this surely would greatly reduce the benefits legislators hoped AB5 would bring to California by increased income from employment taxes.

What Do We Do Next?

No one knows. The law was drafted so broadly and is so new, that it is completely untested. No one really knows how to proceed and how this law will be applied in practice.

Some in the industry and online have tried to think of different ideas to continue doing business as usual without violating the law, but none seem to have a viable solution.There have also been lawsuits filed against AB5 and actions to move toward an appeal. One website (which is really part of one California Assembly candidate’s website for his election campaign) [5] allows the public to post their stories of how AB5 has or will affect their careers.

What most people are doing now is trying to proceed with caution and stay up to date with any changes. It’s a very uncertain time, but one can hope for a favorable resolution.

[1] Dynamex Operations West, Inc. v. The Superior Court of Los Angeles County, 4 Cal.5th 903 (2018).

[2] Assemb. B. 5, 2019 Leg.,  Chapter 296, Statutes of 2019 (Ca. 2019).

[3] Id.

[4] Id.

[5] This campaign website is provided for informational purposes only. It is not an endorsement by Erin M. Jacobson, Esq. of any candidate or cause.

Note: This article does not constitute legal advice.

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April Music Legal and Business Roundup

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Categories: Uncategorized

cowgirl, lasso, roundup

Image via freeimages.com

April had several interesting music legal issues, but first, check out my most recent articles:

In other news this month:

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New Photos

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Categories: Uncategorized

I recently took some photos for the website with fantastic photographer Allison Knight.  You’ll see some of the photos throughout my website, but here are a few more.

 

Clearly, the results speak for themselves!  Allison is also very personable and easy to work with.  To view more of Allison’s profile or book a session, visit her website Allison Knight Images.

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Find the Perfect Attorney for You: I Tell You How on Sonicbids.com

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I have a new article published on Sonicbids.com entitled “How to Choose a Music Attorney That’s Perfect for You.”  You may have seen an earlier series of posts on this topic here on the blog, however, this article is an expanded and updated version that will be really helpful to anyone looking for an attorney.

Sonicbids.com is a great resource featuring a large amount of content relevant to musicians.  I am very happy to be featured on the Sonicbids platform.

I’ll post the full article here soon, but for now – check it out here:  “How to Choose the Music Attorney That’s Perfect for You” by Erin M. Jacobson via Sonicbids.com

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Client Gary Kuo Launches New Website

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My client Gary Kuo, composer and violinist extraordinaire has launched his new website www.garykuo.com.

Gary Kuo SiteThe site features music and scores for purchase, as well as information on Gary.  Visit and bookmark  www.garykuo.com today!

 

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Interview with Steven Corn of BFM Digital

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Categories: Digital Distribution, Music Industry, Music Industry Interviews, Uncategorized, Tags: , , , , , , , , , , , , , , , , ,

 To kick off my first in a series of interviews with music industry professionals, I had a chat with Steven Corn of BFM Digital.

bfm_header_logo

 

BFM Digital is a digital distribution, marketing, and promotions company for select music, film, and other digital content.  BFM distributes its diverse catalog via all the leading digital and mobile platforms worldwide.

 

1.  Please explain a bit more about your company, BFM Digital.

BFM Digital distinguishes itself through its boutique size, personalized customer service and quality catalog.  Representing only select labels and artists allows us to become a true partner and advocate for our client’s digital goals. We work one-on-one with clients to develop a comprehensive release schedule. Further, we interface with clients about pricing and marketing strategies aiming to increase revenue and maximize exposure of their content.

Conversely, BFM also works closely with the leading digital services to promote our catalog on their storefronts through featured placements and product promotions. The strength of our relationships with them enables us to be aware of various promotional opportunities for which we will submit your titles if they are the right fit.

2.  Describe a typical day at the office for you.

During breakfast, I check on the previous sales for iTunes, Amazon and Youtube and make a note of any interesting trends or unexpected sales.  On the way to work (a 45 min commute), I often will skype from my cell phone to one of our European tech partners or distributed labels.  It’s a great way to kill the commute.  I also create my daily to-do in my head while I commute.  Usually the first thing that I do after arriving is to review the back log of agreements that need my review and attention.  I try to get to at least a couple each day.  Next up would be to meet with our delivery department to see if there are any new issues that have arisen.  I’ll look at financials and cash flow statements along the way.  At some point, I’ll discuss potential marketing submissions to the DSPs with my VP of Marketing.  Mixed into the fray is reviewing potential new content providers, reading up on trending news, and seeing how various biz dev workflows are proceeding.  Generally, there are several fires to put out and that can disrupt any plans that I created along my commute.  If I’m lucky, I get to complete 50% of my daily goals.

3. What is your favorite part of your job?

I love tracking the success of a digital compilation that my A&R team created.  We make inter- and intra-label virtual albums to create new retail sku’s from existing catalog.  It’s such a rewarding feeling to see these start to sale.  Creating a new revenue-earning product from nothing is very satisfying.  A close second is when I see one of our needy, indie artists start to make money from their digital catalog.  Our payments have literally housed some of our more financially challenged artists.  Getting them off the streets into decent housing is one of the greatest motivations for being in business.

4.  What do you think is the most profitable area of the music industry for independent artists today?

If you can get an album or catalog to sell across borders, that can be immensely profitable considering the cost efficiencies.  However,  it seems that on a per-unit basis, ringtones and limited edition vinyls present the best profit margins.  But for many, a good synch placement trumps download sales.  Those are few and far in-between in this competitive market for synch’s.

5. What do you look for when you are signing artists?

First, the music has to be high quality.  It doesn’t matter what the genre is.  I have experts in all genres on my staff who can evaluate submissions.  However, good music, regardless of genre, is usually self-evident.  As important as the music is a good strategy.  We need the artist and label to commit to making their product a success.  This means developing and executing a marketing plan.  This doesn’t have to be anything complex or expensive.  All we are looking for is some form of creative and consistent activity.  Without having the proper ammunition, there is little that we can do to assist an artist or label to achieve the next level of success.

6. What would you say is the single most important thing independent artists can do to help grow their careers?

It’s actually two things.  First, gig and gig.  It is important to develop your local market as fully as possible.  These will be the fans that will spread the word.  Secondly, develop a plan.  With very few exceptions, albums without a release strategy and a well thought out plan, rarely succeed.  Take the time to figure out how you want to build momentum and fans.  It always pays off to do so.

7.   Today, everything is online and there is so much content from an infinite number of sites and platforms.  How can artist or band can make itself stand out when there is so much content from so many artists on every digital retailer/platform?

With up to 30 million tracks on some digital services, it is most definitely a crowded marketplace.  While there is no simple strategy for getting your music discovered more easily on the music stores, there is assuredly a very easy way to make your music harder to find.  That would be to just “set it and forget it” (as the infamous infomercial states).  It is more important than ever to develop an action plan to keep your fans engaged and interested.  This can be anything ranging from  a series of homemade videos, blog entries, to candid behind-the-scenes photos or videos. One email blast or tweet orFacebook post is simply not enough.  An artist needs to have a consistent and continuous stream of interactions with their fans to increase discoverability on these services.

 

Thanks to Steve for sharing his thoughts!  I’ll be sharing more interviews soon.