MUSIC

- The Hazards of Music from Many Sources
- Separate Copyright in Music and Sound Recordings
- Record Companies
- Licence Fees
- Commissioned Music
- Copyright Collection Societies
- IMRO / MCPS / PPI
- Financing and Clearing Music for Films

The Hazards of Music from Many Sources

The first thing to be said about music is that most producers will strongly recommend to their colleagues not to go for an eclectic selection of music from a variety of sources for the soundtrack of a film but instead to commission one composer to compose and record the whole soundtrack of the film. This is because most producers who have tried to package various elements into the soundtrack of a film have found that this involved the producer in an enormous level of rights clearances which obstruct the completion and delivery of the film.

Separate Copyright in Music and Sound Recordings

If a producer wants to include an existing piece of popular music from an existing sound recording on the soundtrack of a film, the producer must obtain the consent of both the copyright owner of the music and the copyright owner of the sound recording. Copyright owners of music are usually identified on the sound recording and their consent is usually obtained through the Mechanical Copyright Protection Society. There is a blanket licence from the MCPS in respect of all copyright music in its repertoire for television programmes independently commissioned from independent production companies for RTE and for UK broadcasters as well. Usually the copyright owner of a piece of popular music is not the composer himself but his music publisher, often the arm of a major record company.

Record Companies

More difficult usually is to obtain the consent of the owners of the copyright in the sound recording. Most sound recordings are owned by one of the major multi national record companies eg Sony Music, Warner Brothers, BMG, EMI and there are concerns they have about the use of their sound recordings in a film eg they will be particularly concerned not to give any soundtrack album rights to the producer as then the producer could go into direct competition with the record company in connection with the sale of sound recordings. International record companies are also concerned to establish what kind of films they would be licensing their sound recording to and will want to know the context in which the sound recording is being used in the film so as to prevent it being embarrassed by the context in which it appears.

Licence Fees

Substantially fees will be sought by copyright owners in the music and in sound recordings for the use of these items in films. Fees for use of copyright music in films can be negotiated with MCPS and prices vary widely from the minimum ,300 - ,400 per 30 seconds for a world wide buyout upwards. Fees to record companies for use of sound recordings in feature films can run into thousands of pounds per track, even once approval has been obtained, as the record companies are conscious of the amount they spent to record the track and the amount they are saving the producer who will then not have to record it himself.

Commissioned Music

If the producer commissions a composer to write a soundtrack for a film, the question immediately arises, who will own the copyright in the music. As with the screenplay, unless there is a written assignment of copyright in the music to the producer it remains with the composer as author of it. Producers often seek to acquire the copyright in the music from the composer in return for an agreement to procure payment to him of royalties. The composer then assigns the copyright to a music publisher which will pay both the producer and the composer in respect of the exploitation of the copyright in the music.

Some composers resist assigning copyright in the music to the producer often as a matter of principle or where they feel that the fees being offered to them for composing the music are insufficient. Instead they offer a synchronisation licence of the music which enables the producer to use the music on the film but where the copyright remains with the composer. The result of this is that any further revenues from the exploitation of the music (included as part of the film) goes solely to the composer (see below). A producer will argue that the film is the making of the music as it will be heard throughout the world and he should therefore share in the revenue which arises. It is a matter for negotiation in each case depending on the relative strengths of the composer and the producer.

Copyright Collection Societies

Most composers are members of performing rights societies. In Ireland the relevant society is called the Irish Music Rights Organisation Limited. In the UK it is called the Performing Rights Society Limited. Members assign the performing rights of copyright in their music to the society. These societies then collect from users of copyright music monies in respect of the public performance of that music. These include television and radio broadcasts, discos and pubs, concert venues and theatres and cinemas. These venues are usually required to make returns to the society detailing public performances of music.

The relevant performing rights society usually pays 50% of what is due to the copyright owner in respect of the use of a particular piece of music directly to the composer and the balance of 50% to the assignee of the copyright usually the music publisher. If therefore a feature film is broadcast on television around the world, revenues collected by the relevant local performing rights society are passed on to the society of which the composer and music publisher is a member for accounting to them. This provides an additional source of revenue from the exploitation of the film for both composers and music publishers. Music publishers are therefore often willing to offer advances to producers in return for becoming the music publisher of music, the copyright of which is assigned to the producer, and which is contained in the film.

IMRO/MCPS / PPI

IMRO is a performing rights society and its role is outlined above. Mechanical Copyright Protection Society Ireland Limited (MCPS) also represents copyright owners primarily music publishers (as opposed to the owners of the copyright in sound recordings) and their role in relation to film production is to negotiate synchronisation licences in respect of existing musical works as opposed to specially commissioned music. Phonograph Performance Ireland Limited (PPI) (the English equivalent is Phonograph Performance Limited (PPL) collects revenue in respect of the public performance of sound recordings on TV and video, discos pubs etc and primarily represents the multi national record companies. A producer does not normally come across them. To get clearances for the use of sound recordings in films, the Producer usually has to negotiate directly with the relevant record company.

Financing and Clearing Music for Films

Don’t leave the music until the end!

Financing and clearing music for films
By Gordon Judge, KMB Solicitors, Dublin
gordonjudge@kmb.ie
www.kmb.ie

The right music can help make a film and the wrong music can bury it, so why leave it to chance?

Producers often leave decisions on a film’s music and its cost until post-production. A modest amount may be included in the post-production budget but often the music budget for a film is only really worked out after principal photography has completed. It will be funded from any unspent contingency in the film’s budget and other post production funds that are not needed to pay for the post-production work on the film itself.

This will restrict creative choice when it comes to trying to create the right soundtrack for the film. The chances of putting together the right soundtrack and taking advantage of the complimentary marketing of an album may be lost through lack of funds or because it was not possible to negotiate for more than the bare minimum of rights needed to use the music in the film.

This need not be the case. The right soundtrack will help sell the film and may be a valuable source of revenue in its own right. With a little creative planning, it may be possible to reap some of these benefits in a more cost effective way than leaving it until post-production.

• Negotiate music deals early reducing the likelihood of being held to ransom on limited rights or price for the music.
  Leaving the music until the end will reduce the producer’s bargaining power and may reduce the choice available for licensing or increase the price to be paid for synchronisation and master use licences. Rights owners may be more reluctant to include soundtrack album rights.
• The music soundtrack can be an additional source of both finance and revenues and not a cost.
  It may be possible to finance a much more generous music budget through a record company advance for the soundtrack album as well as being able to negotiate favourable rates for some of its artists. As well as a marketing tool for the film, the right soundtrack album will be a source of revenues too.
• Music can be a valuable marketing tool for the film.
  A music video shot or edited from the film’s footage at modest cost during production that is featured on television and particularly on MTV type channels and other music programmes around the time of release of the film becomes a “free” advertising trailer for the film.
• From the music industry’s point of view, a film may offer a chance to give some artists renewed or enhanced profile.
  With falling sales of compact discs, record companies will consider new ways to boost or revive the careers of their artists. A promising film may attract major artists at reduced fees by virtue of an additional source of revenue for them when the film or the soundtrack album is exploited and not just for the licence fee for the master licence. Record companies may be keen to help package some of their newer artists for the right opportunity to promote them.
• Draw in the marketing power of the record companies early.
  Timing and planning are key elements. Major record companies exist and succeed because of the power of their marketing. A record company trying to promote its artists and soundtrack album, through the use of stills and scenes from a film at the same time as the film is released will draw more customers for the film too. A film and its soundtrack album will have a closely linked commercial life and the marketing efforts of the film and record distributors will need to work together to maximise the benefit from their efforts.

There are effectively two copyrights in a piece of music being used for a film. There is copyright in the work itself and copyright in the recording. A number of different rights owners may be interested in each of these copyrights and this is not just where the lyrics and music have been written by different people.

To include music in a film, you will need the right to copy or record the music, which is the right to synchronise the music in “time relation” with the film and then to exploit the film which will include the performing right, namely the right to publicly perform the film and to broadcast it. The licence of the original copyright is known as the synchronisation licence.

When using an existing recording, you will need the right to dub the sound recording onto the film. This right will need to be licensed from the owner of the recording through a master use licence. Where a new recording is commissioned for the film, this right is secured in the agreement with the performers rather than with a record company, although record company consent may be needed if the artist is under contract with a record company restricting them from making recordings for anyone else.

Composers or authors and performers may also have ‘moral rights’ in their works which will need to be waived or observed, if not waived. For a film that includes a live performance, the producer may also have to consider performers’ rights as the performer has the exclusive right to authorise any recording of that live performance.

Not getting all the rights needed for any production can be “distribution suicide” and may either frustrate distribution entirely or open the producer up to having the remaining rights ransomed by the owner. Ensuring that proper clearance procedures are in place is essential to secure errors and omissions insurance for your production and effecting proper delivery.

Clearly, the overriding desire of the rights owner will be to generate and maximise revenues from the work or the recording that it controls. Where a soundtrack album is only a distant aspiration when negotiating for the rights, the prudent music rights holder may withhold those rights on the basis that the producer can pay more for them when he comes back for them. On the other hand, if the producer can show an intention to bring out a properly promoted soundtrack album, this may be sufficiently attractive to the rights holder not only to have the soundtrack rights included with the original licence but also to allow the music be used at modest cost.

Having a song included in a film will generate revenue for the rights owners. However, it may also prolong or revive the commercial life of the song or the artist, increasing the potential for future licensing revenues or creating a suitable environment for further commercial exploitation of the artist.

Films like Trainspotting and The Full Monty have shown that the potential for creative planning of a film’s music can exist outside the realms of international media conglomerates where the film studio licences from its sister record company and music publishing division.

Creative planning of a film’s music can help with the production financing. Some music will need to be financed whether or not it is properly planned at the early stages. It can be an effective marketing tool and also provide another source of recoupment or profits through revenues from the soundtrack album.

Thinking about the music and opening discussions with the music industry during pre-production rather than waiting until post-production may prove top be a sound strategy.

Gordon Judge, July 2003