What is a music publisher?
Music Publishing is the business of acquiring and exploiting rights in musical compositions. It is a business based on the songs themselves as distinct from the records, films, commercials or other media in which they are used. Publishers are custodians of the song - the words and the music, and their business is to assure that they are heard and enjoyed.
Copyright conveys to writers the exclusive legal right to be compensated for the use of their songs. Generally, the right to receive copyright royalties extends for the life of the writer plus between 50 and 70 years following their death, depending on jurisdiction. Income generated by the use of a song is split between the writer and publisher, with the publisher in most instances responsible for collecting income on behalf of the writer and for distributing their share.
Where does the money come from?
Music publishers earn their revenue from licensing the right to use their songs, a right they have to the exclusion of the whole world. Every time a song is used or performed, the owner of the copyright must grant permission, a licence must be issued and a payment must be made. The more a song gets performed or used the more income is generated for the publisher and songwriter.
Although music publishing grew out of the sheet music business of the last century, the vast majority of publishing revenues today come from three sources - mechanical, performance and synchronization royalties.
Mechanical royalties
The term mechanical evolved out of the practice of converting sheet music into piano rolls that mechanically played the song - hence the name. It was a direct path from piano rolls to recordings. However, what has always remained certain is that each time a record is sold the publisher gets paid. Clearly the pace of growth of this type of income is impacted by how fast the overall recorded music market is growing.
In general, the average mechanical royalty across the world is about 5% of the retail price of a record. That means that for a music publisher it takes a lot of record sales to add up to a meaningful number, especially since out of that 5% the writer and other participants have to be paid their share.
Performance Royalties
Historically performance income was generated when a song was performed live on stage or played in a public place. Now it covers a wide range of uses including when a song is broadcast on radio, television, in a cinema or even over the Internet. Synchronization Royalties This is the third major and fastest growing source of revenue. As the name implies it involves the marrying of the song (words and music) with visuals - like television programs, advertisements and films. |
