Music licensing

November 18, 2018

Excerpt from 'How to Wrestle an Octopus: an agency account manager's guide to pretty much everything'. Available now!

An Australian advertising agency team is creating a TV commercial for a blue-chip client. They want to feature a music track from one of the most iconic bands in the world. They make contact with APRA (the Australasian Performing Rights Association) to find out whether or not they can use the track and how much the usage fee will cost.

In the above example, the agency contacted APRA. APRA is a ‘performance rights organisation’ (PRO) that not only helps Australian and New Zealand music creators get paid for their work (via royalties), but they also help agencies to access music from Australasia and the rest of the world. In some countries, PROs are known as ‘copyright collectives’ or ‘copyright collecting agencies’. A list of current international PROs can be found online.

Unless you are going to use royalty-free music for your production, then you will need to ensure that the music you use is either purpose-made for your project, or has been licensed legally. This will affect not only your TV commercials, but also your marketing and corporate videos, YouTube or other social media videos, radio commercials, and even non-commercial projects.



From the website

Using music in advertising requires the approval from all copyright holders in the song you wish to use in your production.

Commercially-released music: When using a commercially-released song in any advertisement, there are two copyrights to consider. There is a copyright embodied in the composition of the song (the words, the musical arrangement) and a copyright in the sound recording of that song. Often songs are written by someone other than the performer of the work.  

“When re-recording a song, or creating a cover version for your ad, while you may not need to obtain clearance for the original sound recording, you will still need to obtain permission to use the musical work.

Production music: Production Music is music specifically written and recorded to be used in all forms of audio and audio-visual productions, including advertising. Production music tracks are pre-cleared for immediate use and cover both the sound recording and musical work copyrights.

Music composed for your ad: In most cases, the rights you need to obtain to use specially-composed music in your ad will be included in the agreement between you and the commissioned composer.” 

Copyright is split between the recording label, which controls the actual recording of the music; and the publisher, which controls the song itself (the words and melody). Therefore, you’ll need to secure two different types of licence:

  • An ‘administer licence’ or ‘master use licence’ (unless you are re-recording the performance) from either the recording label or the artist directly (if they are an independent artist); and
  • A ‘synchronisation licence’ (TV) and a ‘transcription licence’ (radio) from the publisher. The publisher may be a large company or an individual songwriter who has published their own work.

It’s usually far easier to use your national or regional PRO which can do these negotiations on your behalf.


How much will your client have to pay?

There is no standardisation of licencing fees. They will vary with the usage and the importance of the song.

For example, in Donald Passman’s book ‘All You Need to Know About the Music Business’ (2011) he mentions some fee ranges (in US dollars):

Low-end TV usage (e.g. music is playing from a jukebox in a scene, but no one in the scene is paying any attention to the music) – free (for exposure) to $2,000 for a 5-year licence. In a film, the fee would be $10,000 in perpetuity.

“A more popular song is worth more, perhaps $3,000 for TV and $25,000 for film.

“A song used as the theme song for a film might get $50,000 to $75,000.

“Commercials fetch even more money: “a song can command anywhere from $25,000 to $500,000 plus per year. The typical range for a well-known song is $75,000 to $200,000 for a one-year national usage in the United States, on television and radio.

If you intend to create multiple versions of your commercial or video (e.g. 45”, 30”, and 15”), then you are likely to be charged 3 x the licensing fee; and that the fee may be the same for the 15” as it is for the 45”.

You have to be prepared for the fees to be prohibitively expensive, or you may even find it impossible to license your preferred song, so it always pays to have a Plan B ready. The good news is that many indie artists will be very open to negotiating a deal to use one of their tracks.




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