All Articles Tagged "royalties"
“The Eminem Case” May Affect How Much Money Other Artists Make
Image: Ray Garbo / WENN.com
It was called the “Eminem case” but the outcome can affect hundreds of other musical artists. It may also have an impact on pending lawsuits involving royalties for downloads and ringtones, says Variety.
As the New York Times explains it, producers who discovered Eminem sued his record label, the Universal Music Group (UMG), because of the way UMG calculated the artist’s royalties for digital music. The argument was over “whether an individual song sold online should be considered a license or a sale. The difference is far from academic because, as with most artists, Eminem’s contract stipulates that he gets 50 percent of the royalties for a license but only 12 percent for a sale,” the article says.
Now a resolution has been reached. F.B.T. Productions filed to dismiss its case against Universal Music Group and Aftermath Records after reaching a settlement agreement with the two music companies. This was most likely unwelcome news for artists who were hoping F.B.T, would prevail, which could have resulted in higher royalties to artists for digital sales and usage.
In September 2010, the Ninth Circuit Court of Appeals overturned a 2009 jury verdict favoring UMG in F.B.T.’s suit, filed against Aftermath and UMG in 2007.
“The F.B.T. case had been closely watched, for several class actions and individual suits had been launched in the wake of the appellate decision by artists – - most of them heritage acts with contracts dating in many cases back to the ’70s — who claimed they were also entitled to higher digital royalties. In nearly all cases, the actions cited the appellate decision as a precedent,” reports Variety.
Why all these suits? The plaintiffs claim that they are entitled to a royalty rate of 50 percent of net receipts, granted for masters licensed to third parties. As in the F.B.T. case, the plaintiffs have claimed that they were paid at a far lower royalty rate, according to the music business magazine.
Eminem isn’t the only artists wrapped up in a digital royalties case. There are acts that have been filed which include such artists as James Taylor, Peter Frampton, Chuck D of Public Enemy and the estate of Rick James. And all the major label groups have been sued.
Queen of Soul Disappointed Over Lawsuit
(Eurweb) — Aretha Franklin has expressed disappointment with her longtime songwriting partner after he launched a legal battle over royalty payments. The Queen of Soul says she’s “extremely disappointed” over the lawsuit filed last month by Norman West, who has worked with the singer since the 1980s. West is suing executives at Franklin’s publishing company Springtime Publishing over allegations they failed to sign a royalty agreement for a song called “Put It Back Together Again,” which appears on her latest album, “Aretha: A Woman Falling Out of Love.”
Rick James’ Estate Tries for Eminem-esque Royalties
(New York Times) — Following a recent court decision that gave Eminem and his producers a higher royalty rate for digital music, the estate of Rick James has filed a class-action suit against the Universal Music Group, saying that the company has failed to properly account for royalties and may owe its artists “tens of millions of dollars.” The suit, filed on Friday in United States District Court in San Francisco, seeks unspecified damages from Universal as compensation for unpaid royalties. The case was filed on behalf of a trust representing James, the singer of hits like “Super Freak” who signed with Motown — now owned by Universal — in 1977, and died in 2004. In response, Universal said in a statement: “The complaint filed by the estate of Rick James suffers from many infirmities, not the least of which is that the claims asserted are not appropriate for class treatment. We intend to vigorously defend against it.”
Lyrics, Royalties and The Business of Songwriting
by Sheryl Nance-Nash
Sean "The Pen" Garrett has penned number 1 hits for the likes of Beyonce and Usher
So you think you can write a song? Maybe you stand out among the competition, but if you want to make a living this way you’ll need more than the right melody, lyrics and rhythm to keep you afloat. Your business savvy better equal your talent. But before you start working the system you must understand a few things about how the system works.
How do royalties work?
Royalties are classed according to the media by which a piece of music is experienced. Mechanical royalties are paid for physical sales, i.e., CDs, digital downloads, vinyl records and tapes. Performance royalties accrue as a song is played via the radio, piped in music service or live performance at a music venue. Synchronization royalties or “sync fees” are earned when a piece of music is “synchronized” with a piece of film as in motion pictures, television programs and advertisements. There are now also streaming royalties for a number of internet and digital uses, such as when companies make songs available on their website and telephone service providers sell ringtones.
Radio airplay usually pays the most. When you have a hit song it’s heard repeatedly all over the country and sometimes the world, making it possible to quickly garner substantial royalties. Physical sales are way down from where they used to be as many people skip buying albums to purchase singles. Illegal downloads also hurt profits in this camp. These days, a performing songwriter may make most of his or her money doing live performances of their songs.
Radio airplay is collected by BMI (Broadcast Music Inc), ASCAP (American Society of Composers Authors and Publishers) and SESAC (originally stood for Society of European Stage Authors & Composers). Their methods for collecting royalties and paying their songwriters vary, but generally they collect money each quarter, take out operating expenses and distribute the remainder to songwriters based on the amount of airplay they received during the quarter.
Mechanical royalties, funds collected on the sale of a physical product, is set by copyright law at 9.1 cents per song. According to Bruce Burch, director of the University of Georgia’s Music Business Program and former creative director for EMI Music Publishing, the world’s largest music publisher, synchronization fees are negotiated according to several criteria. Contracts take into consideration such factors as how much of a song is used by the licensee, how popular the song is (hits and classics generally receive higher payments) and the popularity of the songwriter or artist. Sync fees can be set as low as zero, such as when a new artist offers their song to a television show that cannot pay but allows exposure to a new audience. At the other end of the spectrum they can bring in hundreds of thousands of dollars, even millions, for top film composers like John Williams, who has been nominated for 45 Academy Awards, winning five.
What about ownership rights?
It’s all about the deal. There are two ownership shares of a song: the writer’s share and that of the publisher. A writer owns both rights until he assigns the publishing rights, usually for a monetary advance against the song’s future earnings. Starting out novice songwriters must typically sign deals in which they have to give up all publishing rights. A more established songwriter, who perhaps enters a publishing deal with a song already recorded, will usually be able to negotiate an agreement in which he or she retains 50 percent of the publishing rights. Sometimes a songwriter can negotiate reversion rights, an arrangement whereby publishing rights revert back to the songwriter after a certain period of time.
What are you waiting for? (OR How do you get started?)
Now that you know the basic economics of songwriting, here’s some advice from folks at the top of their game.
Study up. Do your research. “This game will eat you up and spit you out. You’re sitting in a lion’s den,” said Sean Garrett, who earned his nickname, “The Pen”, from Jay-Z. He’s written and produced over 17 number one hits for the likes of Usher, Beyonce and Mary J. Blige, in part because he took the time to learn the business. There’s a ton of resources from websites, blogs and seminars, to books like Everything You Need to Know About the Music Business by Donald Passman and Music, Money and Success by Todd and Jeff Brabec.
DMX Sues for Royalties from Jail
(Hollywood Reporter) — Rapper DMX, currently serving six months in jail for a probation violation, is being productive behind bars, suing his copyright administrator. In a complaint filed in New York Supreme Court, the hip-hop artist formerly known as Earl Simmons claims that Rich Kid Entertainment owes him more than $1.5 million after fraudulently misrepresenting its rights to collect revenue on the rapper’s behalf. Simmons says that his contract with Rich Kid only granted it authority to collect money for certain songs produced in 1998, but that the company went beyond the scope of that agreement to take money for other songs.
