A question came about on Syncola – the growing, disturbing trend of people and companies asking you for upfront fees to get your music placed in ads, visual and interactive projects.

And, while it doesn’t make sense in most cases to pay upfront to get your music placed, if a person or a company helps you get your music in a project or ad, it’s a must you give them a share of the backend profit.

This post will discuss backend deals and buyouts – so let’s get started on what a backend deal is and what a master deal is.

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First off, what’s a backend deal?  

For the purposes of this article, a backend deal is a split of the fees paid for the usage of a song in an ad, visual or interactive media project between you and your designed agent.

So what are the fees paid? The sync fee is usually in two parts:

• A master use license fee paid to the owner of the master, and
• A publishing sync fee to the owner and/or composer of the work.

In addition, there are performance rights fees that are paid to the composer/writer (either directly or through their publisher by a PRO) each time your song is broadcast. But we;ll get to all that in another post.

So there are three types of fees that can be split between you and your agent – that’s pretty simple.

What’s not so simple is navigating what represents a fair split, or what types of fees you should split with your sync agent. Let’s dig a little deeper.

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The master sync fee split – the basics.

This is a split of the fee that’s been paid for the use of your original recording.

Depending on the agent, I’ve seen their fee range from 15% on the low end to 75% on the high end (never take that), with the industry norm ranging from 20%-50%.

I personally believe something in the range of 20%-25% to the sync agent is fair in most cases to both the creator/owner and the sync agent, with 50% of your sync fee is the absolute top limit.

And if you are giving a sync agent more than 25% of your fee, have a good reason for doing so, like they have a great track record of syncing your music and/or strategic brand relationships.    Just don’t ever go above 50%.

As to the “buyers” that ask you and your agent to provide your masters for no sync fee with the promise you’ll make it up through performance fees, I’m mostly against it, but if there’s a case where there’s a good upside, it may make sense. we’ll talk about that later.

Suffice to say, I understand why people would provide their master to, say, a large TV network gratis with the promise that multiple broadcasts will result in high performance fees, but in reality, a high payout is the exception than the rule, and I would insist on some sync fee as part of any deal.

And that’s the subject of the next post – backend publishing, retitling and performance rights – we’ll break this down and give you the basic rundown of how retitling works, what the pros and cons are and what kind of deals are out there.

Now, we broke down what a master sync is, the kinds of deals that exist in the market, and in general, what percentages make sense.

And, in our first mention we dealt with people asking you for money upfront (Syncola) and why, in almost every case, you shouldn’t pay before you get some play.

Both of these posts went through what I believe are some fairly clear-cut scenarios in terms of best practices, worst practices and how to navigate potential relationships with agents and sellers.

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NOW, LET’S TALK RETITLING.  

In this post, we’re going to take on retitling, a subject I believe is a real grey area for a lot of people, and one where there’s a lot of misinformation – not to mention a lot of strong opinions (and BS) on both sides.

And, I know not everyone is going to agree with what I have to say, but at the end of the day someone needs to try to properly break retitling down, and it might as well be me.

I say this because most of what’s written on retitling is pretty self-serving and either very pro or very con, but the reality lies somewhere in the middle.

SO LET’S GET RIGHT INTO IT – WHAT’S THE REALITY OF RETITLING IN THE CONTEXT OF SYNC?

In its most basic sense it’s simple.  It starts when you sign up to work with a sync agent or music library that, either in addition to or in lieu of the normal master sync fee (dependent on what company you sign to and/or the particular licensing deal), also offers you a “Non-Exclusive Retitling Deal” (we’ll call it a NERD for short) as part of your overall agreement.

In practical terms, if you sign a NERD, you’re giving the company you’re signed with a non-exclusive right to rename a specific song (e.g., “Happier” versus “Happy”) so they can register your song as your “publisher” with a Performance Rights Organization (e.g., BMI, ASCAP or SESAC in the USA) under that specific name, then collect and split the performance rights fees (they get the publisher fee, you get the writer fee) resulting from any usage of your song when they place it on your behalf.

On the surface, this sounds pretty good.  You both get paid for your work, and it’s a fair breakdown. Especially if it’s non-exclusive, because I can do a deal with other companies and still own my songwriting rights, right?

After all, if a company reps you on a deal with a small or no upfront fee, but a nice potential backend (i.e., let’s say it’s played on TV a LOT), doesn’t it make sense to give that company a fair share of the money, and get your fair share too?  And what’s wrong with changing the name slightly to make sure the money goes to the right people for the right deal?

IT ALL SEEMS PRETTY FAIR AND CLEARCUT WHEN YOU PUT IT THAT WAY, MARK… 

And it is.  Despite what some people may want to tell you the the contrary, what I’ve detailed above is pretty above board. It really can help you get paid, create a good new revenue stream for you, and it is a pretty simple way to show the PRO who needs to get paid.

And, while I wouldn’t retitle any works myself, either as a writer or the agent, I don’t see any real ethical issue with the practice, and despite the flak I’m going to take from some of my friends in the business I’m not going to tell people they shouldn’t go into retitling deals.

If a legit company comes to you with a NERD as part of their overall representation agreement with you, by all means seriously consider it – there are a lot of writers and artists making money that way and at the end of the day, you still get to own your work.

And, while some people say that another issue with non-exclusivity and retitling is that multiple parties will claim ownership for the same work, and this confuses/annoys buyers, I think that’s bunk.

If you are the composer, you’re the owner, and it’s pretty clear who you’ve assigned rights to based on the agreement(s) you’ve signed.  If “Happier” plays on commercial A and “Happy” plays on commercial B, it’s not rocket science for the PRO to know who to pay out to so long as the cuesheets are filled out correctly by the company you’re working with.  There’s nothing unethical or confusing about this.

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SO WHAT’S THE DOWNSIDE OF RETITLING? 

Actually, there are several downsides to retitling, despite what some people may tell you to the contrary, and if you’re thinking of signing a NERD, you need to keep a few things in mind.

1.   JUST BECAUSE IT’S A NON-EXCLUSIVE DEAL DOESN’T MEAN YOU SHOULD SIGN WITH EVERYONE.

Some people think that a non-exclusive means that it’s open season to sign with as many companies as possible, thereby ensuring as many people pitching your music as possible. And, while nothing short of signing an exclusive agreement would stop you from doing this, it’s not a good policy. Music supervisors and producers at agencies have a limited amount of time to go through and process music – and if they are getting the same music from 10 different sources, all with different names and prices, they may just decide to forget about using a particular track as it’s just too much trouble and move on the the next one.

OUR ADVICE? IF YOU’RE GOING TO DO NERDS, DON’T DO TOO MANY – PERHAPS NO MORE THAN TWO OR THREE SO YOU DON’T BURN OUT OR CONFUSE BUYERS.

2.    SOME BUYERS MAY NOT WORK WITH YOU AT ALL IF YOU’RE NON EXCLUSIVE.

There are some buyers, studios, producers, etc., that are extremely risk-adverse and they don’t want to deal with the possibility they’ll be an issue with the rights ownership or assignment of any music they use, so they’ll only use music that’s represented exclusively. This is a bigger issue than retitling – of which a NERD could or could not be a component – and some people really do only work with music that’s repped exclusively, but they’re in the minority, and it’s a legit consideration. That said, the fact is most music supervisors and agencies just want the right music for the right project, and they don’t care whether it’s exclusive or not, so long it works and the licensing/pricing is clear and simple.

THE BOTTOM LINE? MOST BUYERS DON’T CARE IF YOU’RE EXCLUSIVE OR NOT, THEY JUST WANT GOOD MUSIC. PERSONALLY, I WOULDN’T GO EXCLUSIVE UNLESS SOMEONE INVESTED TIME/MONEY INTO PRODUCING AND/OR PROMOTING MY MUSIC AND THEY’VE SHOWN THEY GET RESULTS.

3.   YOU MAY NOT BE ABLE TO DO AND EXCLUSIVE DEAL WITH A BUYER.

Well, yea, ok, but let’s be straight up, retitling or non-exclusivity has nothing to do with this.  The fact is, if your music’s been used before for a project, it’s pretty hard to do an exclusive deal with a buyer after the fact, though by all means it could happen. That said, if there’s an offer for an exclusive/buyout on the table and you want to go for it, you need to make sure before you sign a deal that anyone who is repping you will allow you to remove your tracks from their service at your request.

4.   YOU COULD MISS OUT ON INTERNATIONAL ROYALTIES. 

This could be a real issue for you. If there’s no clearcut idea of which PRO gets paid by the international rights society, because it’s assigned to multiple PROs and publishers, money may be paid out to the wrong company or to no one whatsoever, or at least not to you. That said, international royalty payment is a larger issue which we’ll tackle in a future post. Basically, the fewer companies you’ve assigned rights to, the less confusion will ensue in general, so do your research, consult a PRO, then sign up with two or three reps on a non-exclusive basis if you wish.

YOUR BEST BET? CONSULT WITH (OR SIGN UP WITH) A PRO, AND ASK THIS QUESTION OF THE COMPANY YOU’RE WORKING WITH AND GET ANSWERS IN WRITING.

5.   YOU’LL MESS UP YOUR RELATIONSHIP WITH YOUR PUBLISHER/FUTURE PUBLISHER.

This is, for me, the crucial point you have to take into account before going into a retitling deal.  A lot of people have non-exclusive deals with publishers, have no publisher or are self published, which allows them to enter into retitling deals.

And, while that’s great for the self-publisher, if you have a publisher, can you imagine how they’ll feel about you if assign the publishing share of tracks they’re repping and administrating on your behalf to another company, and that company gets the publishing share of one of your tracks?

ANSWER: NOT GOOD.  NOT GOOD AT ALL.

And you know what, you may just say “So what, they’re angry, they didn’t get me the sync, so why should they expect my loyalty or expect to get paid for something they didn’t do?”And in this particular instance, I really can’t argue with you.

On a more general level, since your publisher is such an important business partner in everything you do, you should avoid undercutting their potential revenue by doing lots of deals assigning your publishing to multiple parties.  You’ll disincentivize them from spending time and money on your behalf to get you sync deals, and in the long run, that can only hurt your efforts.

OUR ADVICE? WORK TO DO DEALS MAINLY THROUGH YOUR PUBLISHER, IF YOU HAVE ONE, WITH A COUPLE – AND ONLY A COUPLE – NON-EXCLUSIVE SYNC AGENTS ON THE SIDE AT MOST, AND COORDINATE WITH YOUR PUBLISHER.  AND IF YOU’RE SELF-PUBLISHED, JUST GO FOR IT, BUT AGAIN – TWO OR THREE DEALS – NOW MORE.

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I hope this helps you navigate some of the issues surrounding retitling, and I really look forward to your feedback.  Continue reading as we cover buyouts and works for hire.

In our last three mentions we covered, Syncola (people asking you for upfront fees to rep your music), what a master sync license is and how retitling works.

In this installment of SyncDeals, we’re going to cover works for hire and buyouts.  These types of deals are a bit different than the typical syncs that most people do – which have a upfront fee (or not) and a royalty fee on the backend. Let’s break it down.

WHAT’S A BUYOUT VERSUS A WORK FOR HIRE?

Basically, a work for hire is a piece (or pieces of) music you create/sell for a set, one-time fee, where you either give up all future ownership rights and future royalties, and it becomes the exclusive property of the buyer (which also happens to be a buyout), or is a commissioned work for which you’re paid a set usage fee and allowed to retain ownership on publishing/master rights (that’s not a buyout…).

So what is a buyout? A buyout can be a work for hire, or it could be an existing track where a buyer pays you a one-time lump sum to buy out all rights to a piece of music. After this, only the buyer can use the track.

These types of licenses are distinct from royalty-free music – which a lot of people tend to call buyout music, but it’s something else entirely.

Royalty-free music is a type of non-exclusive music license where you pay a lump sum to use it, with no future royalty payment to the seller, but the seller is allowed to re-sell this music to other buyers.

In any buyout, there’s no backend or performance rights paid to you for future usage, just one lump sum.

SO WHY WOULD ANYONE WANT TO PAY MORE UPFRONT RATHER THAN A BIGGER BACKEND?

In a word, simplicity.

Much of the time, especially in national, regional or global ad campaigns, it’s simpler for the buyer to pay one sum and not have to worry about the complications of international royalty payments.

Think about it.

You’re a global brand/advertising company launching a multi-million campaign in Europe/S. America East Asia.  The last thing you want to deal with is chasing down who to pay splits, performance rights, publishing, mechanicals and other fees to unless its absolutely necessary.

In a case like this, it’s more than worth it, if the budget is there, for a buyer to pay a seller a higher lump sum for a track, own it outright and then move on the the next task.

SO SHOULD YOU SELL YOUR ROYALTIES AWAY AND TAKE A WORK-FOR-HIRE OR BUYOUT? IT DEPENDS.

On the surface, you may not feel comfortable selling your rights away in a work-for-hire or buyout, but frankly, I believe it depends on the opportunity.

Look at some of the following factors you should consider before making a decision:

• Is it a decent deal?
• Are you getting paid more than you normally would from a normal sync dal where you retain royalty rights?
• It the deal coming from a reputable company/agency?
• Does the deal have significant promotional/marketing potential for you?

If you answer yes to at least two of the above, I say go for it.

The real upside for you is that in the majority of cases, buyouts and works for hire are usually more lucrative as a lump sum deal than you’ll earn on the back end of a traditional deal.

That said, you do risk the chance that you’ll sell the rights to a song, then the song will then either become wildly popular or played a huge number of times and sold off the potential for significant backend revenue, but this is the exception, not the rule.

Just remember it is always your right to say yes or no to any deal, and if you ask, a buyer may be willing to opt to forgoing an buyout – even it it is a work for hire.

And of course, if you’re a well-known artist or composer, or the existing track is well known, your buyout fee will either increase exponentially or there won’t be a buyout on the table in the first place.

Still, for most cases, a buyout/work for hire is pretty simple and clearcut – and in many cases can be a much better payday and/or promo opportunity for an artist than a simple sync. Just don’t expect to ever make a penny off the track once the deal’s done.