Bang to Rights

Welcome to the weekly article looking at the current music industry, its challenges and overall why and how SHOUT4's RevShare model works so well for the independent music industry. Written by SHOUT4 Chairman, Ric Yerbury.

Catchy title I know or just me being a smart arse? Actually, no!  I want to point the spotlight on the journey copyright may take and the consequences of taking certain decisions early in its lifespan.

You will detect a recurring theme in my recent articles with the retention of rights being top of the list. Some of you have asked why I get so vexed about this matter and why assignment to a third party is such a bad thing?

Before I answer that, again, it is perhaps an interesting and useful diversion for us to remind ourselves as to what rights mean in the context of an artist or artists. Below is one definition from the legal dictionary:

the exclusive right of the author or creator of a literary or artistic property (such as a book, movie, or musical composition) to print, copy, sell, license, distribute, transform to another medium, translate, record or perform or otherwise use (or not use) and to give it to another by will.

Now that is pretty broad and basically says from an artist’s perspective, ‘what is mine is mine, unless I say otherwise’. Good start. Now, let’s look at how a standard record contract works. Generally, not always, the master recording is paid for and owned by the record label allowing any rights that would have originated with artists to be subsumed by the label. Granted in signing this off, the label offers to share any profits from the rights created but only after full recoup of money spent. 

So I still have the same question; why do those rights need to move from the originator to a label or publisher to achieve a commercial return and potential accrued capital value? You can absolutely achieve a similar financial return through a Revshare agreement. Having spent time in a number of industries where ownership does not drive the value but actual cash generated, this is a fact. 

In conversation with the owners of one of my favourite indie labels, they were very nervous about not having copyright assigned to them. ‘The rights are my pension’ to quote. My response was simple, assessing capital value of your ‘investment’ in an artist’s catalogue is valued on historic earnings and your right to recurring revenues in the future, not ownership of the asset. ‘Ah’, I hear people say, ‘it’s tradition’. Well so was the penny farthing cycle, the horse and cart, you get the drift. We are facing a transforming world which says that copyright has to be dealt with in a different way to match the changes in both culture and tradition. 

There may of course be another explanation to why many labels and publishers seek full assignment, they are looking to maximise any exploitation of the rights gained for their benefit primarily rather than the artist who created them. (Oh Ed. shouldn’t I have suggested that?)

Going back to that definition, the rights holder can pretty well do what they want and if that is now the label or publisher, that means them not the artists. Of course depending on the status of the artist at the time of the contracts being entered into, there may be some artist ‘comfort’ controls in terms of use of material, expenditure etc. (How many horror stories are there about enthusiastic marketing teams thinking nothing of running up £50k on a single music video which gets added to the artists debt balance?) Truth is, many of these are wholly insufficient to ensure the artist having meaningful creative or commercial control. This is particularly true for those at an early stage of their career.

So in summary here are some dos and don’ts:

Do

Keep writing, keep creating, keep your rights

Licence if required to ensure better exploitation of those rights

Maintain creative control 

Align your partners with a sensible division of returns made from the rights created

Respect and reward investment made in your career through Revshare (SHOUT4 does this for you)

Don’t

Assign rights. Not needed

Commit to any commercial agreement for too long a period

Be fooled that you can’t have a successful career unless you assign

Until next time when we say, ‘thank you for the music’. 

Ric Yerbury

Ric has a background in music as an artist, manager, label owner and promoter. He has combined this with a career away from music as CEO within SMEs and PLCs. As the architect of SHOUT4's Revshare model he is a strong advocate for artists retaining rights and providing legal and financial solutions to the DIY market which reflect the way the world is now and not the past.

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