Earlier this week a number of artist managers in a Facebook group posted photos of letters that their clients received from Music Reports Inc. on behalf of Amazon. They asked what the notices meant and if they were legit.
I am sharing my post, which was shared to a number of other music industry groups:
In the last couple of days, several of you have posted about receiving a notice from Music Reports Inc. and questioned whether or not you should act on the letter.
Let me clarify what you’re receiving, why you’re receiving them, and what you should do about it.
The short answer: Unless your client is signed to a major music publisher or major indie (e.g. Kobalt) OPT IN TO ALL DIRECT LICENSES!
Who is sending these notices?
Music licensing clearing houses such as Music Reports Inc. and the Harry Fox Agency (via it’s service Rumblefish) are hired by digital music services (including the big ones like Amazon, Apple, and Spotify; as well as hundreds of small startups like what musically was but is now TikTok) to help the digital service to secure proper licenses (compulsory or direct) to use music in their service, to calculate royalties, and to make payments and remit statements to the proper copyright owners.
What are you receiving?
What you are receiving are opportunities to opt-in to a predetermined (generally nonnegotiable) direct license, alongside every other non-major / non-major-indie publisher in the world, to license your copyrights to a digital platform within the United States (sometimes the deal is worldwide, which can be problematic, but I don’t want complicate this post). There are also Section 115 NOIs, which goes out for every track released on a DSP for the US mechanical license for the underlying composition (this process is being disrupted by the Mechanical License Collective beginning Jan 1, 2021).
Why are you receiving the notice?
You’re receiving the notice because the agent has your information as the copyright owner (or authorized agent of the copyright owner) for copyrights (generally compositions) that have been matched to sound recordings that the digital service either already has or has access to. THIS IS A GOOD THING. This means that the digital service, via their agent’s (MRI, HFA, etc) database of song ownership information, knows who to pay once the copyright begins to earn royalties (or in the case of a one-time payment, they know who to pay from the pro rata advance pool). The flip side is if they do not have your ownership info, the copyright would not be properly licensed and the creators would not be paid — the royalties earned against their copyright would go into the so-called “black box” or the content will be blocked from the service altogether (e.g. notice that your music isn’t on or monetized on Facebook, Instagram, and Oculus?). Also, if the agent does not have your info for certain uses covered by Section 115 of the US Copyright Act, the notice is currently being remitted to the US Copyright Office.
How do you respond?
Review the license and decide if you want to opt-in or not. For most copyright owners, opting in is really your only shot at being licensed by the service. Up-and-coming artists are not going to be able to do a separate direct license with the service as the service has zero incentive to administer a separate agreement with you. They will do a deal with the major publishers and major-indie publishers and a unicorn artist here or there.
How to make sure that your contact information is readily available to these agents to ensure that they can contact you with licensing opportunities and have your payee info for royalties?
You can hire a pub admin (they’ll earn a 15% to 25% commission on all royalties collected) or you can do it yourself and keep 100% of your royalties in North America via TuneRegistry. See this article as an example of DIY.
Dae Bogan To Join Other Music Industry Experts At US Copyright Office Symposium On Unclaimed Royalties Study in Washington, D.C.
I am honored to announce that on December 6th, three weeks from today, I will be representing the US independent music creators community at a symposium in Washington, D.C. at the The Library of Congress.
A few weeks ago, I was invited by the newly appointed Copyright Royalty Judge, Steve Ruwe, to speak at the Copyright Office’s symposium on unclaimed royalties at The Library of Congress. As a CRJ, Mr. Ruwe is among just three judges who are responsible for setting the royalty rates that all songwriters in the world are paid for the use of their songs in the United States.
Last year, my 2016/2017 research titled “The State of Unclaimed Royalties and Music Licenses in the United States,” — research that led me to founding the world’s first search engine of unclaimed music royalties and licenses and a gateway to initiate claims, RoyaltyClaim (acquired by HAAWK Inc.) — was referenced, and I was personally consulted, by the United States Congressional Budget Office during its analysis of the economic impact of the then-current bill, Music Modernization Act. That bill became law in October 2018 and is now known as the Orrin G. Hatch–Bob Goodlatte Music Modernization Act 2018 (MMA or Music Modernization Act for short).
I have been fighting to ensure that independent and unsigned self-published songwriters are recognized, empowered, and represented in the US music industry for over a decade now. My first break-through was conceptualizing and co-founding TuneRegistry, which enables self-published songwriters to administer their catalog and unlock performance and mechanical royalties while keeping 100% of their copyrights and 100% of their royalties. TuneRegistry has helped thousands of self-published lyricists, composers, producers, and singer-songwriters protect their copyrights and unlock hundreds of thousands, if not millions, of dollars in unpaid and current royalties as well as enter into direct licensing deals with digital music services and social media platforms.
I look forward to discussing how the Copyright Office will develop outreach and messaging strategies to reach and engage self-published music creators and I hope to ensure that these creators continue to have a voice in the room, if not a SEAT AT THE TABLE.
US Copyright Office Announcement: https://www.copyright.gov/newsnet/2019/784.html
(This was originally post on my Facebook page, so my apologies if the hyperlinks directs you to Facebook pages of the mentioned companies).
On Digital Radio Royalties
DIY Musicians – If/when you get a recording placed on non-interactive Internet, satellite, or cable radio (e.g. Pandora, SiriusXM, Music Choice) it earns multiple royalty streams. It is important to understand how to collect them all. I will get granular below to break this down.
Let’s use for example the recording “6 Inch (feat. The Weeknd)” by Beyonce. When this recording is played on Pandora (or iHeartRadio, 8Tracks, TuneIn or any of the other 2,500+ properly licensed webcasters serving the United States), here are the royalty streams:
1. Master Royalties for Featured Performers – Royalties paid to SoundExchange for the featured performers, which are the “named” artists on the track. For “6 Inch,” the featured performers are Beyoncé (main artist) and The Weeknd (guest artist). They each must have an account at SoundExchange to collect these royalties. Here is the unclaimed royalties list for featured performers: https://www.soundexchange.com/…/does-sou…/search-for-artist/
2. Master Royalties for Master Copyright Owner (Label) – Royalties paid to SoundExchange for the copyright owner, which is the label. For “6 Inch,” the label is Columbia Records. The label must have an account at SoundExchange to collect these royalties. (A Few Notes: (1) Major labels have direct deals with most music services, so it is likely that Columbia is paid directly by Pandora. (2) Unsigned artists can collect this income if you properly create your free account with SoundExchange as the copyright owner. This means, you cannot only sign up as the Artist. You are the label!). Here is the unclaimed royalties list for copyright owners: https://www.soundexchange.com/…/do…/search-for-rights-owner/
3. Master Royalties for Non-featured Performers – Royalties paid to AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund (“the Fund”) for the background vocalists and session musicians who performed on the recording. For “6 Inch,” the non-featured performers include Ahmad Balshe (background vocalist) and Derek Dixie (session musician) among others. (Note: 5% of the royalties paid to SoundExchange is passed to the Fund. The Fund conducts research to identify the non-featured performers. They use published credits, such as those published on AllMusic.com (Ex: https://www.allmusic.com/album/lemonade-mw0002940342/credits), Discogs, and other resources to identify the vocalists and musicians on a recording. Keep in mind that if the producer of the track contributed background vocals or live instrumentation, it is important to credit him/her separately as such in addition to his/her producer credit, so that they can access this income stream. At TuneRegistry, we deliver credits to TiVo, which makes metadata available to AllMusic, among other services. If the Fund does not have the non-featured performer on their list, you can check and submit. See “6 Inch” only shows two (2) non-featured performers, but there may be more who just do not know: https://www.afmsagaftrafund.org/covered-rec-artist_SR_Maste…). Here is the unclaimed royalties list for non-featured performers: https://www.afmsagaftrafund.org/unclaimed-royalties.php and here is the list of recordings that the Fund has credits for here: https://www.afmsagaftrafund.org/covered-rec-title_sr_master…
4. Publishing Royalties for Composers/Writers – Royalties paid to performing rights organizations (PROs) such as American Society of Composers, Authors & Publishers (ASCAP), Broadcast Music, Inc. (BMI), and SESAC in the United States for the composers and writers, which is Jordan Asher, Burt Bacharach, Ahmad Balshe, Hal David, Ben Diehl, Beyoncé Knowles, Noah Lennox, Terius Nash, David Portner, Danny Schofield, Abel Tesfaye, and Brian Weitz. Because “6 Inch” uses samples, there are more composers/writers credited on the recording. You can view the full publishing credits for “6 Inch” at ASCAP here: https://www.ascap.com/repertory#ace/search/workID/890413300 (Note: US PROs, like most PROs/CMOs around the world, do not have a public list of unclaimed royalties. It is important to register your song before the release or as soon as possible after release to limit the possibility of having your royalties fall into the “black box,” which is an industry term of unclaimed or unmatched royalties. Also note that if you collaborate with someone who has not affiliated with a PRO, that can slow down the registration process.)
5. Publishing Royalties for Composition Copyright Owner (Publisher) – Royalties paid to PROs for the copyright owner in the compositions. This is the publisher or a self-published songwriter’s own publishing entity. For “6 Inch,” the publishers are 2082 Music Publishing, BMG, Domino Publishing, KMR Music Royalties, New Hidden Valley Music Co, Oakland 13 Music, Sal And Co LP, Songs of FujiMusic, Universal Music Corportation, WB Music Corporation. Because “6 Inch” uses samples, there are more publishers credited on the recording. You can view the full publishing credits for “6 Inch” at ASCAP here: https://www.ascap.com/repertory#ace/search/workID/890413300 (Note: In the US, if you are a self-published writer, you do not need to have a publishing account at BMI in order to unlock your publishing income. You will need a writer AND publisher account at ASCAP. So, if you do not have a publisher account at ASCAP and you are self-published, you literally leave 50% of your income on the table because ASCAP will not pay out the so-called “publisher’s share” to writers (unless they’ve changed this policy).)
In conclusion, if you get a recording on a digital radio platform and it takes off, make sure you have your business in order. We help with all of the above at TuneRegistry. This is what I am doing every day — helping thousands of independent music creators properly register their music so that they are 1.) identified, 2.) accounted to, and 3.) PAID.
Check out my free ebook “The DIY Musician’s Starter Guide To Being Your Own Label & Publisher” available for download at www.daeboganmusic.com (subscribe to my blog) and catch me speaking Oct 12th at A3C Conference in Atlanta or Oct 30th at Music Tectonics Conference in Los Angeles.
CC: Dae Bogan Music
As music is more fluid across listening services, social music apps, and countries, royalties are more complex than ever. At Music Tectonics Conferece, experts from HFA, SynchTank, and Hyperwallet will unpack challenges and solutions, moderated by Dae Bogan, SVP of Global Music Rights at Jammber / TuneRegistry. Learn more at http://www.musictectonics.com
On Lil Nas X’s “Old Town Road” record-breaking chart success and the propensity of people to discredit the song as not being of good quality:
I am reading social media posts by old people (30yo plus) who assume that consumers care about music quality.
Guess what? They don’t.
We have entire genres of music born out of shitty quality (i.e. mumble rap) and entire genres going extinct as a result of apathy to music quality (i.e. soul).
The youth of today have their own standards for consumption. What matters to youth today is the social aspect of music — that is, how music creates a gateway to a sense of community. This has been going on for some time now, but the rise of social music apps and the growth of the first generation born with cell phones in their hands has exacerbated things.
Music quality need not be measurably “good” against songs we’ve historically deemed good and worthy of chart-topping recognition. For consumption in a streaming and social music era, music needs only to strike a chord with audiences that have the time and incentive to play it on repeat.
Charts, after all, are measurements of popularity and not quality. The latter is too subjective to measure anyway.
#MusicBusinessMonday: About Direct License ‘Black Box’ Royalties And Music Publishing Administrators
(Author’s Note 07/08/2019 10:33 AM PST: An industry associate of mine who is an independent music publishing industry leader and activist/advocate, as well as the owner of a small music publishing administration company, reached out to me to express his concern that my blog post paints all music publishing administrators in a bad light. He explained that entering into direct licenses is common practice for all publishers — including full-fledged publishers that own or co-own copyrights, as opposed to just handling administration like pub admins do — and not just pub admins. I know that. He felt that pub admins are being unfairly singled out in my blog post. As I explained to him, that is not my intent. I have many blog posts of opinions, analyses, criticisms, praises and reviews of many sectors and companies of the music industry. It is my role as a music creators’ rights advocate and watchdog, if you will, to raise awareness about these issues and practices, and educate music creators on their rights and business. This particular blog piece is not about small pub admin shops, like the one he operates, that has an overage of a few thousand dollars at the end of the year from direct deals, but rather the nature and effect of some of the large “catchall” pub admin services aggregating hundreds of thousands to millions of copyrights and the potential voluminous black boxes that direct licenses can accrue for their bottomline. These are some of the issues that we are asked about at TuneRegistry when speaking with songwriters who have or are considering switching to self-administration or to supplement the efforts of their existing large pub admin. Calling out provisions, or lack thereof, in contracts that songwiters may not be aware of, and which ultimately impacts their income, regardless of if it’s a small shop or goliath, is fair industry criticism. But, for clarity, this piece is in direct response to recent inquiries we’ve received at TuneRegistry regarding some of the popular catchall pub admin services on the market and not small pub admin businesses)
In this particular case, I get that he may take offense when the criticism may extend to parties that are not acting malicious — and I’m not saying that the big players are acting malicious anyway, but rather this issue is a fact of the deal that songwriters sign and should be aware of — and want to be presented in a fair light. So, to that end, I’ll update the post and my socials.
A music publishing administrator’s (“pub admins”) job is to register your musical works with CMOs/PROs/MROs in the territories for which you’ve hired them to represent your administration rights and to collect your royalties, prepare and remit income statements and payments to you. However, some pub admins go a step or two further and issue or enter into direct licensing agreements with companies on behalf of the compositions that it represents, such as direct performance licenses for startup social music apps or a blanket license for background music services.
The right to enter into direct licenses may be included in your contract with the pub admin. In this case, you will have explicitly granted the pub admin the right to license your songs, without asking permission per license, to third parties. In some direct deals, companies give advances or negotiate minimum guarantees to be paid to publishers. These advances and minimum guarantees are deducted from the actual earned royalties that are calculated from the usage of songs by the licensed service. However, in the event that there is an overage (meaning, the total volume of usage does not equal or exceed the advance or minimum guarantee) the difference between the overage and the actual earned royalties is the unallocated “black box” royalties.
It is important that these monies flow to the songwriters that the pub admin represent (less an appropriate commission) as the license fees were paid against the licensed catalog of songs, regardless of actual usage.
Surprisingly, although pub admins that ask songwriters to grant them the explicit right to direct license the songwriter’s songs, many pub admins do not have or do not communicate their policy for distributing unallocated “black box” royalties that stem from these direct licenses. And some cases, they just keep the black box royalties as miscellaneous income.
What’s in your contract? Talk you your pub admin about direct license black box royalties.
Last month I had the pleasure of curating and moderating the panel “Music Tech Investors and Incubators — Investing in the LA Music Tech Scenes” at the Amplifying Music in Our Los Angeles conference produced by the UCLA Center for Music Innovation.
My panelists included representatives of investors, accelerators and co-working communities in Los Angeles that focus on music industry entrepreneurship including Techstars Music, Capitol Music Group’s Capitol360 and gBeta Music Tech Accelerator, and The Rattle LA, as well as more open format accelerators including Expert Dojo and Startup UCLA & Blackstone Launch Pad.
In this <60 minutes discussion, we covered plenty of information that any founder of a music startup would want to know about where and how to seek resources to develop, launch, or grow a music venture in Los Angeles.
Bios of my speakers can be found below the video of the panel.
- Moderator: Dae Bogan, Founder, TuneRegistry; Lecturer, UCLA Alpert
Dae Bogan is a music rights executive, serial entrepreneur and educator with over a decade of experience in the music industry. He is the founder and CEO of TuneRegistry, which develops music rights administration software and solutions for small and medium-sized music rightsholders. He also offers music rights, business, and technology consulting through his firm, Rights Department. Dae also teaches the Music Industry Entrepreneurship course at UCLA Herb Alpert School of Music and was an Innovation Fellow at the UCLA Center for Music Innovation. Previously, Dae owned and operated an independent record company (Loft24 Records), a music publishing company (Loft24 Publishing), and an artist management company (Renaissance Artist Management) until 2012 when he founded an in-store independent music video network (Maven Promo), which was later acquired by EMPIRE Distribution in 2017. Dae also founded the world’s first aggregator and search engine of unclaimed music royalties (RoyaltyClaim), which was acquired by HAAWK in 2017.
- Jonathan Wallace, Investment Director, Expert Dojo
Jonathan Wallace joined Expert Dojo upon its inception as an investment analyst. Over the course of the next 3 years he established relationships with some of the largest venture capital funds in the world and helped dozens of startups raise investment. Jonathan is now the investment director for Expert Dojo and oversees all follow on investments. Expert Dojo has over 30 companies in its portfolio after investing for the last 12 months.
- Josh Remsberg, VP, Business Development, Capitol Music Group
Josh Remsberg is Vice President of Business Development at Capitol Music Group. At Capitol, he oversees the Capitol360 Innovation Center, and is focused on finding & developing new revenue opportunities to exploit and extract value from CMG’s copyrights, content, brand assets, and artists. Josh also leads the eCommerce, CRM, audience ownership and gaming strategies for the label group.
- Leah Nanni, Venture Coach and Outreach Coord., Startup UCLA & Blackstone Launch Pad
Leah is a business owner and Venture Consultant at Startup UCLA, where she helps Bruins become confident and competent entrepreneurs. She also co-leads Startup UCLA’s outreach and inclusion efforts with the goal of reaching entrepreneurs at any stage, in any industry, and from any background and any area of study. Leah holds a M.S. in Social Entrepreneurship and a Master of Social Work, and she brings more than 9 years of business ownership experience to the UCLA and greater Los Angeles communities.
- Jen Hall, Director, TechStars Music
Jen Hall is a music industry veteran having worked in management with major artists and at record labels over the past 15+ years. Jen joined Techstars with the inception of the Techstars Music program in 2016. Techstars Music has just finished its 3rd program. Alumni companies from the Techstars Music 2017 and 2018 class have gone on to raise over 50 million dollars in follow on capital.
- Michael Frick, Advisor/Executive Producer, The Rattle, LA
Michael Frick is a creative solutions innovator with the ability to build consensus among disparate stakeholders. His expertise in music driven strategies for brands, motion pictures, television and digital entertainment has seen him partner with numerous major global brands, agencies, networks and studios. As advisor to the Rattle he is assisting with the launch of the UK-based collective in Los Angeles, CA.
Duration: 1 hour 30 minutes
Order: Click here to purchase.
Every day, millions of music streams, downloads, digital transmissions, public performances, and broadcasts generate tens of thousands of dollars in unclaimed royalties. To date, the estimated pool of unclaimed royalties exceeds $2 billion.
These royalties are often due to independent music creators, heirs and beneficiaries, and legacy artists. After a period of time, these unclaimed royalties accrue in escrow accounts around the world only to be disbursed by market share to the major labels and publishers leaving the indies, to which much of the money belongs, underrepresented and unaccounted to. Music royalties forensics is the process of searching for, identifying, and claiming these royalties. This course is an introduction to the art and science of finding and unlocking unclaimed royalties.
Your instructor, Dae Bogan, is a music rights and royalties tech entrepreneur (original founder of music rights administration platform, TuneRegistry, and the world’s first search engine of unclaimed royalties and music licenses, RoyaltyClaim), music creators’ rights advocate, and lecturer of music industry entrepreneurship at UCLA Herb Alpert School of Music. He has written about black box royalties extensively on his blog DaeBoganMusic.com. He has helped hundreds of music creators and rights-holders find and unlock hundreds of thousands of dollars in unpaid music royalties from around the world. And his research on the state of unclaimed music royalties was used by US Congressional Budget Office in its analysis of the Music Modernization Act of 2018.
- What are your rights, entitlements, and income participations as a music creator and/or rights-holder?
- What are the most common royalty streams generated from a variety of music usage types and where do those royalties flow?
- How are music royalties allocated and distributed by music rights organizations?
- What are niche funds and sub-funds that often generate unmatched so-called “black box” royalties and how do you check for your records?
- How to track music usage to leverage usage and detection reports to reconcile or audit royalty statements?
- What are some tools and resources to help you search for, identify, and claim unclaimed royalties and music licenses?
- What are the requirements to properly setup to be accounted to and paid royalties from previously unaffiliated sources going forward?
- What are some tips for managing your music rights affiliations?
- What are some tips for preparing your music rights and royalties for beneficiaries?
Duration: 4 hours (with breaks)
Order: Click here to purchase.
From digital-first record labels and social music apps to AR/VR music experiences and blockchain-based music streaming startups, entrepreneurs have been disrupting and innovating across the music industry since the launch of Napster in the early 2000’s.
In this masterclass, you will learn to apply principles of entrepreneurship and fundamental business strategies to the music industry in ways that will make you a stronger asset within a team or a more strategic music creator or entrepreneur.
- How to form quality ideas using design thinking techniques in the ideation process.
- Understanding the intellectual property implications of your creations, products and services in the music industry.
- How to utilize market research and quantification methodology to vet ideas and quantify opportunity in the music industry before you invest your time and resources.
- How to throw away your 30 page business plan and instead develop an actionable business model that centers around product-market fit.
- How to launch with a lean go-to-market strategy.
- How to develop basic digital marketing funnels.
- How to get out of your own way by applying data-driven strategies to prioritize your monetizable skills. (Key insight for music creators seeking to monetize their skills while building a career as a performer.)
- How to keep yourself motivated by identifying and repeating your most powerful motivators.
- How to attract co-founders and build teams on a budget.
- How to build company culture in small or remote teams.
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