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by Jeffrey & Todd Brabec One
of the ways that music publishers attract writer-performers
is through the services they can offer in developing their
careers as recording artists. A common approach that is used
in the area of artist development deals is for the publisher
to guarantee the financing of a set number of master quality
studio recordings (and sometimes even a video) so that record
companies will be able to hear the writer-performer at his
or her best and, if a recording artist agreement is secured,
the publisher will receive royalty points on albums and singles
released under the deal. For example, the publisher might
guarantee $15,000 to $30,000 to record master quality demos
and if a recording artist agreement is secured, the publisher
might receive a production or executive producer royalty of
1% to 3% for its efforts.
Other times, publishers might even finance an entire album
of the writer's performances and try to sell or license the
album to either an independent or major record label. The
value of this approach, even though it is more expensive due
to the fact that an entire album is being produced including
artwork and possibly a video, is that the publisher is providing
the record company with a finished product ready to be released.
Many times, this is an easier sell. On occasion, the record
company will add some new tracks to the album or further enhance
the already completed master recordings or redo certain aspects
of the production. In these cases, the music publisher will
virtually always be entitled to royalty points on the album
from the record company in addition to many times being able
to recoup its recording costs from the initial monies earned.
Sometimes the executive producer points are limted to the
first album, sometimes they apply to all albums recorded under
the recording artist agreement and sometimes the points are
on a graduated scale downward for each subsequent album.
One of the variations in the area of development deals is
to provide for an equipment fund so that the writer-performer
can purchase new musical instruments, amplifiers and other
accessories. This may be handled either on the basis of an
extra advance to the writer who will make the decision as
to what is needed (for example, "an additional advance
of $5,000 to $10,000 to the songwriter within 30 days after
the signing of the agreement which shall be used for the purchase
of musical equipment, the choice of which shall be in the
songwriter's sole discretion"), a fund which will be
spent with the mutual approval of the publisher and the songwriter
(for example, "an advance of $5,000. which shall be payable
by publisher for the purchase of equipment mutually agreed
to by both the songwriter and the publisher") or a fund
which can be accessed by the writer submitting invoices from
the retailers detailing the amount of the expenditure for
each item purchased with the publisher paying the seller directly
(for example, "publisher shall pay invoices directly
to the music retailer upon submission of invoices for musical
equipment selected by the songwriter within the approved budget
of $7,500.").
If a recording artist agreement is not secured within an
agreed amount of time (e.g., 1 year, 18 months, 2 years, etc.),
the publisher many times has the option to convert the deal
into an exclusive songwriter/co-publishing agreement which
is based on the writer delivering a minimum number of newly
written compositions. If the publisher does turn the development
deal into a songwriter's agreement, there will be a schedule
of yearly advances (many times with a minimum/maximum formula
to ensure that if the writer-performer becomes successful
as a songwriter that the advances will reflect that success)
with a clear understanding of the number of songs that the
writer or group is expected to write. For example, the term
might be 1 year plus 3 options with the advance range being
from $25,000 to $75,000 per year, the annual minimum song
commitment being from 6 to 10 and, if the advance structure
is on the high side, a recorded and commercially released
commitment rather than one based only on the creation of new
songs regardless of whether or not they are actually released.
There are innumerable variations in these conversion deals
but the duration of the agreement will usually match (but
not be longer than) the duration of the term of the agreement
had the publisher been successful in securing a record deal
for the writer. For example, if the original term was 1 year
plus 3 contract period options, the conversion deal would
not last longer than that envisioned in the initial agreement.
Excerpted from the book "Music, Money
and Success" by Schirmer Book. Reprinted by permission
from the authors.
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