Music Libraries, Reps, Brokers, Online Music Supervisors……what's the difference?

I have just finished a fantastic speaking tour in Vancouver….thanks to everyone who came out and for your incredible enthusiasm.

One of the greatest benefits I get from teaching is to get out hear from YOU. It helps me understand what it is you need to know to move forward with your music career and how it relates to music licensing.

The theme for me lately has been “how to make music licensing a part of your business model as an artist.”

Every musician is different. Some of you are songwriters looking to have your songs covered and performed, others of you produce and perform your own music, while even some of you are non-touring musicians who are looking to take decades of talent and translate it into income.

In the same way, the music licensing business is more diverse then you think.

It’s a food chain, an ecosystem like any other. There are some projects and shows that are going to go for the hits, the best music out there. They have the budgets. Then there are projects that look steadfastly to the Indie and unsigned artists to license from both for the innovation, buzz and affordability. And then there is the library business.

The Music Library business has been a hot topic lately and one I am very intimately familiar with because I built one of the very first models online called HANK. It seemed such a DUH for me and my team when we developed HANK. A place online where those looking to license music could go and search by genre, tempo, mood and vocals. I took the Indie Labels and Publishers that I represented and hosted their music in HANK to allow our clients music to be available 24/7. I founded HANK in 2005 and launched in 2007.

The “Library” business or “Online Music Supervision” business was growing rapidly. They were popping up like rabbits. It was clear that the only scalable model was what I called the “something everything” model. This meant that anyone could submit their music into the system; the goal being to have the MOST tracks in your library. One company stood out in this sector of the business; Pump Audio. Investors agreed and they were steadfastly aquired by Getty Images in 2007 for 9 times their yearly revenue. It was an extraordinary sign of what was about to happen. The explosion, and I mean this figuratively and literally, of the online music library business.

I myself, chose a very different model, and one that ended up NOT being scalable financially. I chose to be selective about the content, to be exclusive and to take a smaller % of only up front fees. Right or wrong, it is the model I still believe in, but it was simply not sustainable financially.

Pump Audio was agressive on many levels, but they were groundbreaking in their revenue model. A model that has changed the music licensing business forever. For better or worse. They take 50% (I am hearing 70% now) of all revenue both front end licensing fees as well as back end royalties, which means that in order to collect on your behalf they must re-title your work and essentially re-assign the copyright non-exclusively.

See, until Pump Audio came into the game there were STOCK MUSIC companies that paid musicians and composers and up front fee to write on assignment for them. The Stock Music Co owned the master and the pub and the artist retained the writers share. This was a sustainable and fair model for many years.

Every time I speak about music licensing I am asked about Music Libraries and what I think about them. I think that the term MUSIC LIBRARY is just a term to describe a company. Other similar company types would be a MUSIC HOUSE (mainly servicing the advertising industry), a BROKER or REP, or even a sync centric PUBLISHER. All of these companies do the same thing; they represent your music for the potential of licensing it to a licensor.

Some of these companies use “online searchable databases” as their leading offering. To date I have seen no one in this space crack the code. Music Supervisors simply don;t have the time to look ourselves, we need to have the music spoon fed to us based on the briefs we send. Other companies take a Agent approach, like a REP or a BROKER. They have smaller rosters and more personal relationships.

The key difference here in all of these companies that you must look at is what portion of the business they service. Stock Music Houses and Music Libraries service the TV Networks that refuse to pay upfront master and publishing fees and will only pay back end. This is the ultimate numbers game. The Libraries load their content onto hard drives and deliver them to the respective clients whom have signed “blanket licensing deals” with. Simply put, the company pays one lump sum to use any of the tracks in the library as much as they want for the period of time allowed on the license (usually one year). Then each show Supervisor turns in a cue sheet and the Library collects the Public Performance royalty on the backend as additional compensation. This rings very similar to how ASCAP, BMI and SEASAC charge for bars and restaurants to play their music, and I would fair to guess they pay put the same way as well.

Reps and Brokers are going after the golden eggs at the top of the business, what I like to call the PREMIUM CONTENT. These are the hits – the hit makers and the tastemakers that have the talent and style that catches the ear of one of these reps, and they go to work trying to place that music in any one of the top TV shows or global and National TV ads where the placement fees average $5000-$100,000 for one license. Make no mistake, this is the top of the food chain.

So in summation of this overview, I give you this advice; think about your music diversely and honestly. Not every track is going to be GREAT, and many of them may not even be GOOD, but within these vastly different types of companies you have the opportunity to choose where your content belongs. The B sides? Great for a music library. The hits…..go for a rep.

Section out your music like this, ask friends for advice and keep doing your homework on all these companies. It’s a very very big business and more players enter it every day, which in my estimation is a GOOD thing……so lets check them out.

Yes, it can be overwhelming, so create a network with your colleagues and friends about whom they have spoken to and liked. Help one another, and in doing so you will help yourself.

 

One Response to “Music Libraries, Reps, Brokers, Online Music Supervisors……what's the difference?”

  1. james penelton September 21, 2011 at 12:30 pm #

    Not. Really sure of any besides taxi and row fax (which by the waay cost money), so don’t know if I’m of any help.

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