When you write songs for a stage musical, you will earn a share of the money earned from the show until its copyright expires. But because you own the copyright in each of those songs, they can have a life outside of the show, too. Even songs from unsuccessful or unproduced shows can generate income for songwriters (both composers and lyricists) for years… income they do not share with their stage producers, or even their bookwriters.
The song “As Time Goes By” was originally written in 1931 by Herman Hupfeld for the Broadway musical Everybody’s Welcome. The show was not a hit, but the song had some moderate success on its own in recordings and live performances. When it was used a decade later in the film Casablanca, however, it became a standard of the American Songbook, generating more income for the songwriter than the Broadway show ever did.
These rights in songs that are separate from the musical for which they were written are referred to as music publishing rights, which allow for a myriad of uses based on the various rights controlled by a song’s copyright owner. These uses form an overlapping web of licenses that can be difficult to decipher. The network of licensing opportunities is made even more complex by the development of new technologies and the attempt by copyright law and evolving industry practices to keep up with them.
So, let’s try to untangle the web of music publishing rights and consider the opportunities they present to those of you who combine words with music to create something new.
Music Publishing
Music publishing rights refer to the ability to make, or license, a range of uses of your songs, including the right to:
1. Sell printed (or digital print) versions of the song, including the music and/or lyrics and arrangements thereof (“print rights”),
2. License the public performance of a song (including both “small rights” and “grand rights”),
3. Include a song in a sound recording (“mechanical rights”), and
4. Include a song in an audio-visual work (“synchronization rights”).
This list is not exhaustive, nor are the rights mutually exclusive; the same use of a song can generate multiple licenses. For example, a cast album may pay the songwriters for a dramatic performance license (i.e., a “grand rights” license) and a mechanical license. If the recording is then used in, say, a commercial, film, TV show, or video game, then a synchronization license will be required, too. Someone needs to negotiate and track all of these licenses, collect the revenues, and pay it out to you. That is the music publisher.
In the past, it was common for music publishers to acquire the copyrights in songs written by a songwriter for the life of copyright in exchange for an advance and ongoing royalties to the songwriter. Happily, this practice of having to assign your copyright is less common these days for theatrical songwriters, and songwriters will more often share or retain their copyright when making a co-publishing deal (with a publisher splitting the publisher share of certain income streams with the songwriter) or an administration deal (for a publisher’s commission in the ten to 25% range), with the publisher licensing these rights as an agent and administrator and the songwriter retaining their copyright ownership. Co-publishing deals can run for a term of years or life of copyright; administration deals generally run for three to five years.
Music publishing revenue is excluded from the definition of “subsidiary rights revenues” in theatre contracts (except for the grand rights royalties from cast albums), so it is not shared with anyone else, including the stage producer or the librettist, and the revenues are payable exclusively to the songwriter and their publisher.
We will now review those four most commonly licensed music publishing rights.
Print Rights
Before there was digital media, radio, or even recorded music, there was sheet music, which was the original music publishing market and provided the basis for calling it “publishing” in the first place.
Though it was once the largest (and only) source of revenue from music publishing (e.g., over 5,000,000 copies of the sheet music for the song “After the Ball” was sold at the end of the nineteenth century), print rights are now the smallest slice of the music publishing pie.
Print royalties are derived from the sale of printed music material, including both lyrics and musical notation. Companies like Hal Leonard and Alfred Music print piano-vocal sheet music folios and educational arrangements, but there are also companies that print lyrics on t-shirts and other merchandise. Lyrics also appear in an album’s liner notes and, more recently, on digital music services (e.g., Spotify, MusixMatch). There’s no government rate set for print rights, and the rate is typically a percentage of retail or wholesale price, or a percentage of a site’s gross revenue from paid subscriptions or advertising.
Performance Rights: Grand vs Small
Grand Rights
Songwriters can license their song, or a group of their songs, to tell a story (like a stage musical, opera, revue, oratorio, or ballet). This narrative or “dramatic” use of music is referred to as the grand rights in the composition, or, as the Copyright Act refers to it, the dramatico-musical rights. These are the rights that songwriters license to theatre producers for use in a stage musical, most often licensed directly from the writer or their representative. Generally, the writers will get a royalty based on gross box office receipts.
If the show is then published by a licensing house (e.g., MTI, Concord Theatricals), they will license the grand rights to the stock and amateur theatrical market, retaining a commission for their services (ten percent for professional theatre licenses, twenty percent for amateur licenses). The musical can be licensed into foreign markets, too. While the rights to all or some foreign territories may be retained by the author, sometimes certain foreign territories are licensed to the theatrical producer and/or the licensing house.
“Jukebox musicals” are created when a group of previously recorded and commercially distributed songs are put together and formed into a stage musical with a new book that joins them together in a narrative context. Music publishers often must get permission from the songwriters to license these grand rights, and the royalty they get is usually a pro rata share of the total composer and lyricist royalty for the show (e.g., if you license two songs to a show with sixteen songs, you would get 2/16ths of the total composer and lyricist royalty).
Sometimes it is difficult to determine whether a use is “dramatic (grand)” or “non-dramatic (small).” Generally, however, a use is deemed to be grand if it comprises:
1. A performance of an entire dramatico-musical work, or
2. A performance of one or more musical compositions from a dramatico-musical work that is accompanied by dialogue, pantomime, dance, stage action, or visual representation of the work from which the music is taken, or
3. A performance of one or more musical compositions as part of a story or plot (whether or not it is accompanied or unaccompanied by dialogue, pantomime, dance, stage action, or visual representation), or
4. A performance of a concert version of a dramatico-musical work.
Small Rights
The term small rights refers to the non-dramatic performance rights in music, in which the song’s performance does not include any narrative elements. In order to license their small rights, the songwriter registers the song with a performing rights organization (a “PRO”). PROs grant non-exclusive licenses for the performance of music to distributors and venues like radio broadcasters, TV networks, concert halls, nightclubs, arenas, bars, restaurants, stores, gyms, waiting rooms, and anywhere else songs can be publicly performed in a non-narrative context. PROs in the U.S. include ASCAP and BMI (there is also SESAC and GMR, but you can only join them “by invitation”). There are many foreign PROs, too, including SACEM (France), GEMA (Germany), and PRS (U.K.).
PROs also license performance rights to digital distribution platforms, both interactive streaming (e.g., Spotify, Apple Music) and non-interactive streaming and satellite broadcasting (e.g., Sirius, Pandora). Most often they negotiate blanket licenses, covering all the songs in a PRO’s catalogue.
The way the monies are then distributed by a PRO is complicated, since distribution is often based on a sampling of usage, not actual usage, and calculated based on each PROs own particularly arcane formulae. Nevertheless, if you are unhappy with the rates charged by ASCAP or BMI, you can challenge those rates in the U.S. District Court for the Southern District of New York, which will then determine a reasonable rate for your work. While this is an exceedingly rare occurrence, it is something for songwriters to be aware of.
PROs pay 50% of the royalties they collect to the songwriter and the other 50% to the publisher. As the songwriter, you can only join one PRO; your music publisher will have to register with the same PRO in order to get their share. If you are self-publishing, you can register yourself both as the songwriter and as the publisher in order to collect all that is due to you. The U.S.-based PRO you choose will also represent you in other countries. If you do end up making a deal with a music publisher, they will then administer the existing publishing entity you registered with the PRO.
Foreign PROs also collect performance license revenues from movie theaters, a portion of which eventually makes its way back to you. Movie theaters in the U.S., however, do not require a public performance license due to a 1948 judicial consent decree (don’t ask!). Also exempted from the need to obtain a performance license are small bars and restaurants that play TV shows and radio programs that were originally aired for the public, as long as the establishment doesn’t record and rebroadcast the programs, charge admission, or otherwise fail to meet the requirements of the Fairness in Music Licensing Act of 1998.
Mechanical Rights
When player pianos started to become popular in the late nineteenth century, with the ability to play songs encoded on a roll of paper, the sheet music publishers sued the player piano folks for infringing on their print rights. The Supreme Court held, however, that the encoded rolls were not printed reproductions of music but, instead, were part of the mechanics of the piano itself. Thus the concept of mechanical rights was born.
Mechanical rights are the type of rights a producer needs in order to record or reproduce a piece of music in a sound recording (e.g., CDs, DVDs, vinyl records, cassette tapes, greeting cards, karaoke, ringtones, digital downloads, interactive streaming, et cetera). A mechanical license is required whether the recording is in a physical or digital form.
Unlike other types of music publishing rights, mechanical rights licenses are “compulsory” in the U.S. (and some other countries, too) because, after the first time the song has been recorded and distributed, any subsequent user can record the song (a “cover version”), or “sample” it, by paying a mechanical rate set by federal law, without needing the songwriter’s permission. Only the first mechanical license is under the control of the songwriter and their publisher. Not all mechanical licenses are compulsory, however. A user can always choose to pay the compulsory rate but there can be negotiated deals, as well (see the section on cast albums below).
To obtain a compulsory license, users pay the statutory fee to either the writer, their publisher, or a third party agency (such as the Harry Fox Agency or Music Reports, Inc.) when a publisher is represented by such an agency. You can find the current mechanical license rates on the U.S. Copyright Office website here: https://copyright.gov/licensing/m200a.pdf.
In 2018, Congress passed the Music Modernization Act, which established the Mechanical Licensing Collective (the “MLC”) to automatically collect and pay mechanical royalties from U.S. digital service providers (e.g., Spotify, Apple Music, Amazon Music, etc.). This can sometimes add up to substantial revenue. If you are represented by a music publisher, you should already be receiving revenue from the MLC. If not, you should register your songs at https://www.themlc.com and start collecting your mechanical royalties from livestreams. Of course, if you haven’t done so already, you need to first register your copyright with the U.S. Copyright Office (see https://www.copyright.gov/registration) in order to demonstrate that you are the copyright holder of the songs.
Master Recordings
A sound recording is actually comprised of two distinct copyrights: (1) the copyright in the composition of the song being recorded (including its music and lyrics), and (2) the copyright in each sound recording of that song. Music publishing rights (including mechanical rights) deal specifically with the songwriter’s composition. The copyright in the sound recording, however, is controlled by the record company (or “label”) that finances the production of the recording, not the music publisher. So, in addition to the mechanical license for the composition, a use of the recording also requires a Master Use License from the owner of the master recording (usually the label or record producer, or sometimes the recording artist).
If you are not working with a label but instead want to release your own sound recording, you will need to manage your income from master use licenses as well as mechanical royalties. There are no government rates set for master use licenses, so they can vary greatly. Remember, however, that the owner of a sound recording does not have any public performance rights in the U.S.; a user can play a sound recording in the course of a live performance without needing a master use license, as long as they have secured the appropriate public performance rights in the composition.
Another source of income for the owner of a master recording is the Compulsory License under §114 of the Copyright Act. A non-interactive stream of music (e.g., Pandora) can either obtain a master use license directly from the label or they can rely on the §114 Compulsory License by filing a “Notice of Use” with the U.S. Copyright Office before it starts streaming the songs. If you are acting as your own label, you can collect your share of the Compulsory License fees by registering as the “sound recording copyright owner” on SoundExchange.com. According to Sound Exchange, the label will receive 50% of the monies earned, while performers (e.g., singers) will get the other 50%.
Since 2011, music streaming (including subscription services, digital radio services, and on-demand streaming services) has steadily increased to now account for over 80% of all music industry revenue in the U.S. If you don’t have a music publisher or a label, you may want to pay for a distribution service (e.g., TuneCore, Distrokid, CD Baby) to get your songs on Apple Music, Spotify, YouTube, Amazon, Google Play, and other such streaming platforms. Which distributor suits you best will depend on your personal circumstances. When choosing a distributor, you should consider at least three things: (1) the fees and royalty splits with the distributor, (2) the type and number of platforms they can get your songs on, and (3) the sufficiency and transparency of their reports about your earnings. It’s worth noting that such digital distribution companies do no promotion or marketing of your work; you’ll have to do that yourself. Some will account for music publishing royalties and some require you to obtain and pay for your own licenses.
Cast Albums
Cast albums are a special sort of sound recording. Because a cast album includes all or most of the songs from a show, and sometimes portions of the dialogue, too, as well as the title and logo of the show and other visual elements (often including the printed lyrics to each of the songs), and is performed by the show’s cast, the producer of the cast album must acquire a grand rights license. This right is often negotiated by the composer, lyricist, and bookwriter as part of the original production agreement with the stage producer.
In addition, each of the songs performed on the sound recording requires a mechanical license, too, so the songwriters will receive both the mechanical royalty for each song (which they split only with their music publisher) and their share of the grand rights royalty (60% to the authors, 40% to the stage producer). While the record company will want to recoup its expenses before paying the songwriters their grand rights royalties, the songwriters are still due their mechanical royalties on every unit sold (note: the songwriter’s mechanical royalties on physical copies of a cast album are often capped at 75% of the statutory rate, with the rationale that all the songs are often by the same songwriter(s). One has to wonder why that should give the producer a discount, and why a statutory rate is permitted to be reduced at all, but… whatever.).
Synchronization Rights
Synchronization rights refer to the rights to use a song in a motion picture, television program, or other audio-visual recording. They are called “synchronization” (or “sync”) rights because the music is “synchronized” with an audio-visual work.
Unlike a mechanical license, a sync license is permissive, not compulsory (i.e., it is granted at the songwriter’s and/or publisher’s discretion) and so can be quite lucrative because it is negotiated on a case-by-case basis, with no set rates. The factors for determining an appropriate fee include:
• Popularity of work – Commercial value of the song and prominence of the writer,
• Scope of Use – Media included in the use (TV, Web, Video Game, Ad, et cetera),
• Term – Length of use (one week, one year, perpetually, et cetera),
• Territory – Where will the synched use be seen (Local, National, Worldwide), and
• Nature of Use – how prominently is the song being featured in the use (both in terms of the quantity and quality of the use).
While sync rights are primarily licensed for film and television uses (particularly TV commercials), some new media uses—including video games, social media [e.g., TikTok and YouTube], and even fitness platforms [e.g., Peloton]—have become an increasingly large source of sync revenues.
In recent years, some sync licenses are frequently granted without the publisher or the songwriter negotiating individual licenses, due to the unique nature of online video sharing platforms. In 2020, the National Music Publishers’ Association and TikTok reached an agreement where millions of songwriters represented by publishers can “opt in” to a licensing agreement that allows the music to be used in TikTok videos. A similar opt-in system is available for YouTube and Facebook videos. These “micro-sync” fees for “user generated content (UGCs)” are quite low per use (hence the term “micro”). But even micro-syncs can sometimes generate meaningful revenues because of the sheer volume of users, as well as the fact that such UGC platforms pay for both a micro-sync license and a blanket public performance license. Still, even if the syncs are not generating much revenue, some songwriters find the publicity generated from online videos worthwhile anyway.
Syncs are not necessarily limited to just audio-visual uses. Certain audio-only uses require sync licenses, too, including music used on podcasts, in which music is synched/incorporated into a new audio recording. If a song is performed live on a podcast, the sync license comes from the music publisher. If the podcast is using a recording of a song, its use requires both a sync license from the publisher and a master use license from the owner of the master recording, the same as if it were an audio-visual use. Another example: if a song is played on the radio during the course of a broadcast, treated the same as any other song being played, then a blanket small performance license is sufficient. If, however, the same radio program uses a specific song as part of the show’s opening for each day’s episode, then they have to get a sync license, too.
Similarly, while sync licenses are not limited to audio-visual uses, not all audio-visual uses require a sync license. If a song has been spontaneously featured in the course of a live TV show, for example, broadcasters will be covered by their blanket performance license. That type of “sync” is referred to as an “ephemeral use,” and the producer is not responsible for an additional license in that situation. However, if that live show is rebroadcast or streamed later, the station will have to get a sync license since the use is no longer ephemeral; it has become part of pre-recorded content.
A final point: sync licenses almost always require a master use license, so the owner of the recording must grant a license, too —usually at rates that are on a “most favored nations” basis (i.e., “no less than”) with the publisher/songwriter’s sync license.
Conclusion
As you can see, there is a wide range of opportunities available to the owners of copyrighted songs, with new uses for music being developed utilizing new technologies never imagined by the progenitors of player piano rolls. Hopefully, as a professional theatre songwriter, you have retained ownership of your theatre songs so you can maximize your potential revenues from these various revenue streams, monetizing your music in new and exciting ways for years to come.
But music publishing is not for the faint of heart. It takes some experience and understanding of the music industry (and expertise with theatre music, in particular) to navigate it and correctly track and collect your royalties from many sources; that is why music publishers exist. Still, it’s important for you to understand this field for yourself, so you can work with your publisher effectively, or even self-publish if you feel you have the time and skills for it.
Music publishing has not always been an industry with the best interests of the writer in mind and, while much has changed in that regard over the years, and you may be more willing and able to trust your publisher these days, you will always be your own best advocate. It’s okay to trust…trust, but verify.
[Special thanks to those who contributed to this article, including Ralph Sevush, Yuanxiao Xu, Deb Hartnett, and Sean Patrick Flahaven.]
