Beat Licensing: Protecting Your Beats and Your Business
Did you know that the practice of licensing beats online has a long history? In fact, this phenomenon dates back to the SoundClick era.
The ease and convenience of online beat licensing have helped democratize music production. It means that almost anyone can pursue a career as a music producer.
That’s fantastic, right?
Still, beat licensing is a complicated and serious business.
The world of music production and beat-making is dynamic.
So, you have to understand copyright and licensing.
It is crucial to protect your valuable creative work and ensure that your business thrives.
Are you a seasoned producer?
Maybe you are just starting.
Either way, this comprehensive and detailed guide will explore the nitty-gritty of music licensing and copyright protection.
You will also learn how these factors can impact your music career.
If you’re a new producer, also consider doing some research about beat licensing before you start selling your beats.
About Me
I am Hector Ramos, the proud CEO of two prominent entities in the music industry.
These are In House Producers and Traffic for Beats.
My unique journey in the music business spans over a decade.
Yeah, it has been that long.
I am glad to say that it has been a remarkable ride.
I’ve been producing quality music, and I love that.
However, I’m also actively involved in marketing and promoting beats. So, I can say that I have made a significant impact in the industry.
Throughout my career, I’ve had the honor and privilege of working with many influential artists.
Some examples include the likes of 50 Cent, Wu Tang Clan, Maino, Rich The Kid, and Smith n Wessun.
I value these collaborations because they have improved my understanding of the music industry.
One of my proudest and greatest achievements is consistently averaging beat sales of over 4000+ per month.
I did that for an impressive three consecutive years.
I don’t like to toot my own horn, but with the kind of track record I have, I can at least claim one thing.
I possess a wealth of knowledge and hands-on experience in producing beats and, perhaps more importantly, in effectively selling them.
My skills, know-how, and expertise have allowed me to connect with a diverse range of artists.
Musicians, producers, and music enthusiasts, to name a few!
I can also offer guidance on copyright protection and the strategies you need to know to protect your beats.
This will help you build a thriving and vibrant business in the music industry.
Why is it important?
You will learn how to safeguard your beats and your music business for lasting success.
What is Music Licensing?
You can think of music licensing as the legal process that allows individuals or entities to use copyrighted music.
These entities or people can use music for various purposes, from Films, commercials, and other media projects.
So, what does it mean for beatmakers and producers?
In this context, licensing involves granting others the legal right to use your beats.
These organizations or people can use your beats for their creative endeavors.
However, you still retain ownership of the underlying composition.
Ever heard the phrase “beats for sale”? This term can be a little misleading.
This is because what’s actually being sold is a license to use the beat.
This license gives the purchaser the right to use the beat as they see fit.
They can use it in a song or other audio production up to a certain number of sales or streams or for a certain period of time.
This period is legally known as the term.
When the licensee reaches this limit, the license expires. After that, they will need to buy another license to continue using the beat.
Licensing Conditions
As in other industries, the specific terms and conditions of the music license will vary, depending on the music producer who is selling the beat.
Still, most licenses will usually include the following terms and conditions:
- The type of license (non-exclusive or exclusive)
- The number of streams or sales allowed
- The term of the license (how long the purchaser or licensee can use the beat)
- The credits that the producer must receive
Here’s an important consideration.
Your music licensing agreement is a binding legal document.
So, you must use it even if you are providing music beats to an artist for free.
There are two main types of music licensing. These are non-exclusive beat licensing and exclusive beat licensing.
Non-Exclusive Beat Licensing vs. Exclusive Beat Licensing
Non-Exclusive Beat Licensing
You may have heard of non-exclusive licenses.
They allow you to sell your beats to multiple clients or artists simultaneously.
Hence, the term non-exclusive! These clients or musicians can use your beats for their creative projects.
However, you can continue to license the same beat to other entities or people.
A non-exclusive license allows multiple artists to license the same beat legally.
As a producer, you should keep this in mind.
When an artist records vocals to a beat they’ve licensed from you, the resulting song is deemed a derivative work.
So, although the artist has created a new song, their copyright only covers the lyrics. You, as the producer, still retain the copyright for the beat.
If the artist decides to submit the song to distribution services like TuneCore and is asked about the copyright ownership of the song, they should disclose that they only hold the copyright for the lyrics.
Here’s one more thing.
They should also explain that they have created a “new work” that incorporates copyright-protected audio.
While non-exclusive licenses tend to be cheaper for the licensee, they can limit your income potential from a single
beat.
Exclusive Beat Licensing
What about exclusive licenses?
As the name indicates, these licenses give the purchaser sole rights to use the beat.
This means that you can no longer license or sell that beat to others once an exclusive agreement is in place.
As you can infer, these licenses often come with a higher price tag.
This is because the buyer gains full control over the beat.
When is this arrangement more viable?
This can be a lucrative option if you have a unique and in-demand beat.
The term “exclusive rights” is versatile and can refer to an exclusive license, as we previously described.
However, in some cases, producers may offer “exclusive rights” and still specify in their contract that they are transferring full ownership of the beat to an artist.
This practice is also known as “purchasing a beat outright.”
Buying a beat outright, also called signing a work-for-hire agreement, means that you’re transferring complete ownership of the music beat to the buyer.
What does that mean?
The buyer will be able to use the beat in any way they want. In other words, you will no longer have any rights to the beat.
As a music producer, you should consider selling beats outright only when you are offered a substantial sum of money.
It’s crucial to know that when you sell a beat outright, you forfeit the right to sell your product to others or incorporate it into your own musical projects.
You have to understand the nuances of these licensing types. This is because it directly affects your revenue and how people use your beats.
Royalties, Writers Share, and Publishing Rights
When someone uses your beats in their projects and generates income, you’ll be entitled to royalties.
We can divide these royalties into several categories.
Mechanical Royalties
Mechanical royalties are paid to the copyright holder (you, the producer).
You receive them in exchange for the physical or digital reproduction and distribution of the music.
It is very simple. When someone purchases or streams music containing your beats, it generates mechanical royalties.
You should know that the mechanical royalty rate in the US is currently set at 9.1 cents per distribution or reproduction of a copyrighted composition.
You can do the math. This means that if a song containing your beat is sold on a CD, you’ll earn 9.1 cents for each CD that is sold.
Similarly, for digital downloads, you will receive 9.1 cents per download. When your music is streamed on a platform, you’ll receive a share of the revenue generated from the streaming activity.
Songwriters Royalties
As a beatmaker, you may not always be the songwriter.
However, if you are, you’re entitled to songwriters’ royalties. These royalties come from the composition itself.
They are typically split between the songwriter and any collaborators.
Songwriters typically receive their royalties via a performing rights organization (PRO).
Some examples are ASCAP, BMI, or SESAC.
These PROs are responsible for monitoring and tracking the public performances of songs and then distributing the earned royalties to the respective songwriters.
Songwriters’ royalties are different from mechanical royalties and are collected separately.
Performance Royalties
Finally, performance royalties come into play when your music beats are performed in public.
This could be on the radio, in a live concert, or on streaming platforms.
PROs like ASCAP, BMI, and SESAC collect these royalties on behalf of songwriters and publishers.
The performance royalties received by a copyright holder depend on several variables.
The popularity of the composition, the frequency of its performances, the venue where it’s played, and the like!
For example, as a copyright holder, you would earn a more substantial royalty for your composition when it’s played on a well-known radio station compared to a performance in a small local club.
You must understand how these royalties work to maximize your earnings and profitability as a beat producer.
What is Copyright, and How to Copyright Your Music?
Copyright is a type of legal protection.
It grants exclusive rights to the creator of an original work, such as musical composition or beats.
As soon as you create a beat, it is automatically copyrighted in your name. That’s pretty slick.
However, you should consider registering your copyright with the US Copyright Office.
Why is that so?
It provides stronger legal protection, enabling you to take legal action against copyright infringements.
To copyright your music:
- Create a tangible copy. Make sure that your beat is in a fixed form, such as a recording or sheet music.
- Register with the US Copyright Office. There are two options. Register your copyright online or through the mail. Registration is important as it provides a public record of your copyright, making it easier to enforce your legal rights.
- Enforce your copyright. If an individual or entity uses your beats without permission, you can take legal action to protect your rights.
Percentage Payment – Who Gets What?
When your beats are used in a song, royalties are distributed among various parties.
Also, the division can vary depending on the specific agreements or terms in place.
Producer’s Share
As the beatmaker, you have done the hard work and are entitled to a share of the royalties.
You are at liberty to negotiate and agree upon the percentage with the artist or songwriter.
Songwriter’s Share
Were you also involved in writing the lyrics or melody?
If so, you’ll also receive a share of the songwriter’s royalties. You can negotiate this based on your level of contribution.
Publishing Rights
What if you have assigned your publishing rights to a publishing company?
In that case, they will collect a portion of the royalties. If you retain your publishing rights, you’ll receive this share directly.
Final Thoughts
It is imperative to understand the nuances and complexities of music licensing and copyrights.
You must also know how royalties work.
As a beatmaker, it is vital to your success.
Whether you opt for non-exclusive or exclusive licenses, protect your legal rights and negotiate agreements carefully.
As a music artist or producer, know that your beats are your intellectual property, and understanding the legal and financial aspects and ramifications will help you thrive in the competitive music production world.
Frequently Asked Questions
Can a beat be copywrited?
When you create an original beat you have copywrite protection from the get go. We also recommend registering your copywrite to the US copywrite office for additional benefits and an extra layer of protection.
What is beat licensing?
Beat licensing is the process by which a music producer gives another party permission to use the compositions or beats for a song, album, mixtape, video and or Tv use, in exchange for a fee.
What is Publishing rights for a beat?
A music producer owns the publishing rights to the beat once it’s created. Understanding publishing rights is very important for the music producers and also the recording artists. The music producer has the right to perform and license the instrumental composition.
What does 50% publishing mean on a beat?
50% publishing” is about the ownership or control of the publishing rights associated with the writers that made the song.. In music production and collaboration, this percentage is the portion of publishing rights held by each of the collaborators.
