Val Johnson
New member
What's up y'all? If the work is made for hire do the producer get royalties? And do you copyright the song and music as a Sound Recording or Work of The Performing Arts?
If a work is made for hire do the producer get royalties?
- Thread starter Val Johnson
- Start date
kebeats
New member
What's good.. Nope, & I'd say sound recording.
Val Johnson
New member
What about mechanical royalties?
Last edited:
kebeats
New member
Idk wtf that is? Lol. Me personally I'm not worryin bout royalties.
fataltone
Holy Lamb Media & Ent.
HowStuffWorks "How Music Royalties Work"
great article
posted it here as well
Mechanical Royalties
Record companies and recording artists, as well as the writers and publishers, all make money based on the sale of recordings of their songs. How those royalties are calculated, however, is about as intricate and controversial as everything else in the music industry.
Writer/publisher mechanical royalties
First, there is the calculation of mechanical royalties for writers and publishers. These royalties are paid by the record company to the publisher. The publisher then pays the writer a share of the royalty (typically split 50/50).
In the United States, the royalties are based on a "statutory rate" set by the U.S. Congress. This rate is increased to follow changes in the economy, usually based on the Consumer Price Index. Currently, the statutory rate is $.08 for songs five minutes or less in length or $.0155 per minute for songs that are over five minutes long. So, for example, a song that is eight minutes long would earn $.124 for each recording sold.
As in most areas in the business world, however, there is room for negotiation. It is not uncommon -- in fact, it is more the norm -- for record companies to negotiate a deal to pay only 75% of the statutory rate, particularly when the writer is also the recording artist. (See the "Controlled Composition Clause" below.) Although there is a statutory rate, there is no law against negotiating a deal for a lower one. Sometimes it is in the best interest of all parties to agree to a lower rate.
Recording-artist mechanical royalties
Recording-artist royalties (and contracts) are extremely complex and a hotbed of debate in the music world. From the outside, the calculation appears fairly simple. Artists are paid royalties usually somewhere between 8% and 25% of the suggested retail price of the recording. Exactly where it falls depends on the clout of the artist (a brand new artist might receive less than a well-known artist). From this percentage, a 25% deduction for packaging is taken out (even though packaging rarely costs 25% of the total price of the CD or cassette).
That sounds simple enough, but there are many more issues that affect what a recording artist actually makes in royalties.
•Free goods - Recording artists only earn royalties on the actual number of recordings sold -- not those that are given away free as promotions. Rather than discounting the price to distributors, many record companies give a certain number away for free (about 5% to 10% depending on the artist). Recording companies also give away many copies to radio stations as "promo" copies. There is also a reduction in royalties made for copies of the recording sold through record clubs.
•Return privilege - Recordings in the form of CDs or cassettes have a 100% return privilege. This means that record stores don't have to worry about being stuck with records they can't sell. Most other businesses don't work this way, but the music industry has to be more flexible and timed to demand. What's hot today may be forgotten tomorrow... This leads us to reserves. The recording company may hold back a portion of the artist's royalties for reserves that are returned from record stores. (Usually about 35% is held back.)
•90% - Back in the days of vinyl records, there was a lot of breakage when record albums were shipped out for distribution. Because of this, recording companies only paid artists based on 90% of the shipment, assuming that 10% would be broken. Even as vinyl was phased out, this practice continued. Today it is gone for the most part, but there are still a few holdouts.
So, here is how it looks so far. Let's say a CD sells for $15. Right away we deduct 25% from that for packaging, which makes the royalty base $11.25. Now let's say our artist has a 10% royalty rate and that his CD sells one million copies. That sounds great! The artist would earn $1,125,000! Except 10% of those were actually freebies, so we really have to calculate that royalty based on 900,000, which makes the royalty $1,012,500, and of course, there are few costs we haven't talked about yet.
Advances and recoupment
Typically, when recording artists sign a recording contract or record a song (or album), the record company pays them an advance that must be paid back out of their royalties. This is called recoupment. In addition to paying back their advance, however, recording artists are usually required under their contract to pay for many other expenses. These recoupable expenses usually include recording costs, promotional and marketing costs, tour costs and music video production costs, as well as other expenses. The record company is making the upfront investment and taking the risk, but the artist eventually ends up paying for most of the costs. While all of this can be negotiated up front, it tends to be the norm that the artists pay for the bulk of expenses out of their royalties.
Let's see what these recoupable expenses do to our artist's $1,012,500 royalty we calculated earlier. Suppose the recording costs were $300,000 (100% recoupable), promotion costs were $200,000 (100% recoupable), tour costs were $200,000 (50% recoupable), and a music video cost $400,000 (50% recoupable). That comes out to:
$300,000 + $200,000 + $100,000 + $200,000 = $800,000
Suddenly our artist isn't making a million plus, he's making $212,500. But don't forget there is also a manager to be paid (usually 20%), as well as a producer and possibly several band members. The artist won't see any royalty money until all of these expenses are paid.
Controlled-composition clause
So far, it sounds like the money isn't in making the music, it's in writing it. While this is a true statement, controlled-composition clauses make it less fair to folks who are both the songwriter and recording artist of a song.
A controlled composition is a song that has been written and/or is owned by the recording artist. Because mechanical royalties paid to songwriters and publishers are not recoupable by the record company, meaning the record company can't deduct any expenses from them, record companies usually negotiate into the singer/songwriter's contract that the mechanical royalty rate he will receive as the songwriter/publisher will be 75% of the usual amount. In other words, as the writer of a song you record yourself, you get 25% less royalty money than you would get for writing a song that someone else records. But you'll get performance royalties when the song is played on the radio, TV, etc.
Internet royalties
With the explosion of the Internet and the ease of downloading music onto your computer, a whole new royalty arena has opened up in recent years. Record companies usually treat downloads as "new media/technology," which means they can reduce the royalty by 20% to 50%. This means that rather than paying artists a 10% royalty on recording sales, they can pay them a 5% to 8% rate when their song is downloaded from the Internet. In the case of downloaded music, although there is no packaging expense, many record company contracts still state that the 25% packaging fee will be deducted.
An alternative to this royalty payment method also exists for Internet music sales. While it is most often used by Internet record labels, it may still catch on as recording artists begin to push harder for it in their contracts. This other method creates an equal split of the net dollars made on music downloads between the record label and the artist. This net figure is arrived at after the costs have been deducted, including costs of the sale, digital rights management costs, bandwidth fees, transaction fees, mechanical royalties to songwriters/publishers, marketing costs, etc.
great article
posted it here as well
Mechanical Royalties
Record companies and recording artists, as well as the writers and publishers, all make money based on the sale of recordings of their songs. How those royalties are calculated, however, is about as intricate and controversial as everything else in the music industry.
Writer/publisher mechanical royalties
First, there is the calculation of mechanical royalties for writers and publishers. These royalties are paid by the record company to the publisher. The publisher then pays the writer a share of the royalty (typically split 50/50).
In the United States, the royalties are based on a "statutory rate" set by the U.S. Congress. This rate is increased to follow changes in the economy, usually based on the Consumer Price Index. Currently, the statutory rate is $.08 for songs five minutes or less in length or $.0155 per minute for songs that are over five minutes long. So, for example, a song that is eight minutes long would earn $.124 for each recording sold.
As in most areas in the business world, however, there is room for negotiation. It is not uncommon -- in fact, it is more the norm -- for record companies to negotiate a deal to pay only 75% of the statutory rate, particularly when the writer is also the recording artist. (See the "Controlled Composition Clause" below.) Although there is a statutory rate, there is no law against negotiating a deal for a lower one. Sometimes it is in the best interest of all parties to agree to a lower rate.
Recording-artist mechanical royalties
Recording-artist royalties (and contracts) are extremely complex and a hotbed of debate in the music world. From the outside, the calculation appears fairly simple. Artists are paid royalties usually somewhere between 8% and 25% of the suggested retail price of the recording. Exactly where it falls depends on the clout of the artist (a brand new artist might receive less than a well-known artist). From this percentage, a 25% deduction for packaging is taken out (even though packaging rarely costs 25% of the total price of the CD or cassette).
That sounds simple enough, but there are many more issues that affect what a recording artist actually makes in royalties.
•Free goods - Recording artists only earn royalties on the actual number of recordings sold -- not those that are given away free as promotions. Rather than discounting the price to distributors, many record companies give a certain number away for free (about 5% to 10% depending on the artist). Recording companies also give away many copies to radio stations as "promo" copies. There is also a reduction in royalties made for copies of the recording sold through record clubs.
•Return privilege - Recordings in the form of CDs or cassettes have a 100% return privilege. This means that record stores don't have to worry about being stuck with records they can't sell. Most other businesses don't work this way, but the music industry has to be more flexible and timed to demand. What's hot today may be forgotten tomorrow... This leads us to reserves. The recording company may hold back a portion of the artist's royalties for reserves that are returned from record stores. (Usually about 35% is held back.)
•90% - Back in the days of vinyl records, there was a lot of breakage when record albums were shipped out for distribution. Because of this, recording companies only paid artists based on 90% of the shipment, assuming that 10% would be broken. Even as vinyl was phased out, this practice continued. Today it is gone for the most part, but there are still a few holdouts.
So, here is how it looks so far. Let's say a CD sells for $15. Right away we deduct 25% from that for packaging, which makes the royalty base $11.25. Now let's say our artist has a 10% royalty rate and that his CD sells one million copies. That sounds great! The artist would earn $1,125,000! Except 10% of those were actually freebies, so we really have to calculate that royalty based on 900,000, which makes the royalty $1,012,500, and of course, there are few costs we haven't talked about yet.
Advances and recoupment
Typically, when recording artists sign a recording contract or record a song (or album), the record company pays them an advance that must be paid back out of their royalties. This is called recoupment. In addition to paying back their advance, however, recording artists are usually required under their contract to pay for many other expenses. These recoupable expenses usually include recording costs, promotional and marketing costs, tour costs and music video production costs, as well as other expenses. The record company is making the upfront investment and taking the risk, but the artist eventually ends up paying for most of the costs. While all of this can be negotiated up front, it tends to be the norm that the artists pay for the bulk of expenses out of their royalties.
Let's see what these recoupable expenses do to our artist's $1,012,500 royalty we calculated earlier. Suppose the recording costs were $300,000 (100% recoupable), promotion costs were $200,000 (100% recoupable), tour costs were $200,000 (50% recoupable), and a music video cost $400,000 (50% recoupable). That comes out to:
$300,000 + $200,000 + $100,000 + $200,000 = $800,000
Suddenly our artist isn't making a million plus, he's making $212,500. But don't forget there is also a manager to be paid (usually 20%), as well as a producer and possibly several band members. The artist won't see any royalty money until all of these expenses are paid.
Controlled-composition clause
So far, it sounds like the money isn't in making the music, it's in writing it. While this is a true statement, controlled-composition clauses make it less fair to folks who are both the songwriter and recording artist of a song.
A controlled composition is a song that has been written and/or is owned by the recording artist. Because mechanical royalties paid to songwriters and publishers are not recoupable by the record company, meaning the record company can't deduct any expenses from them, record companies usually negotiate into the singer/songwriter's contract that the mechanical royalty rate he will receive as the songwriter/publisher will be 75% of the usual amount. In other words, as the writer of a song you record yourself, you get 25% less royalty money than you would get for writing a song that someone else records. But you'll get performance royalties when the song is played on the radio, TV, etc.
Internet royalties
With the explosion of the Internet and the ease of downloading music onto your computer, a whole new royalty arena has opened up in recent years. Record companies usually treat downloads as "new media/technology," which means they can reduce the royalty by 20% to 50%. This means that rather than paying artists a 10% royalty on recording sales, they can pay them a 5% to 8% rate when their song is downloaded from the Internet. In the case of downloaded music, although there is no packaging expense, many record company contracts still state that the 25% packaging fee will be deducted.
An alternative to this royalty payment method also exists for Internet music sales. While it is most often used by Internet record labels, it may still catch on as recording artists begin to push harder for it in their contracts. This other method creates an equal split of the net dollars made on music downloads between the record label and the artist. This net figure is arrived at after the costs have been deducted, including costs of the sale, digital rights management costs, bandwidth fees, transaction fees, mechanical royalties to songwriters/publishers, marketing costs, etc.
Val Johnson
New member
Mechanical royalties are the royalties paid to songwriters and their publishers from the sale of records.
---------- Post added at 12:14 AM ---------- Previous post was at 12:08 AM ----------
Ok cool so it doesn't say anything about producers getting royalties. When a producer is made work for hire they don't get any royalties.
---------- Post added at 12:17 AM ---------- Previous post was at 12:14 AM ----------
OK cool thanks.
---------- Post added at 12:26 AM ---------- Previous post was at 12:17 AM ----------
Ok cool thanks fatal tone and K.E beats.
---------- Post added at 12:14 AM ---------- Previous post was at 12:08 AM ----------
Ok cool so it doesn't say anything about producers getting royalties. When a producer is made work for hire they don't get any royalties.
---------- Post added at 12:17 AM ---------- Previous post was at 12:14 AM ----------
OK cool thanks.
---------- Post added at 12:26 AM ---------- Previous post was at 12:17 AM ----------
Ok cool thanks fatal tone and K.E beats.
J
Jlacck
Guest
The technical term in regards mechanical royalties is that it is actually required to be paid to song writers for the USE of a song on a physical medium. In other words, you are suppose to be paid a mechanical royalty even if the record doesn't sell. However record companies got smart and realized its better to negotiate that they'll only pay mechanical royalties on a record that sells.
In any case without getting into all the legal mumbo jumbo of mechanical royalties let me answer your original question:
In most cases, work for hire contracts do not pay royalties. In fact, you often give up your rights to claim ownership or royalties from the work YOU created. However, any and everything is usually negotiable. So you can negotiate a royalty rate or even partial ownership if you have that type of clout to modify the agreement. But the truth is negotiating a work for hire kind of defeats of the purpose of using a work for hire agreement. Just be aware of that.
D
In any case without getting into all the legal mumbo jumbo of mechanical royalties let me answer your original question:
In most cases, work for hire contracts do not pay royalties. In fact, you often give up your rights to claim ownership or royalties from the work YOU created. However, any and everything is usually negotiable. So you can negotiate a royalty rate or even partial ownership if you have that type of clout to modify the agreement. But the truth is negotiating a work for hire kind of defeats of the purpose of using a work for hire agreement. Just be aware of that.
D
Val Johnson
New member
J Lacck thank you. Fatal Tone thank you.
Last edited:
H
HIMbeats
Guest
Yes...as already stated a "Work For Hire" contract waives ALL of your rights in most situations. Think of it like this...if you created software for Microsoft under a work for hire contract they own the rights to what you created. You are basically an independent contractor working for them. A "work for hire" is just that.....you are a work for hire. You have no rights to the work. Now you could re-write the work for hire contract to including a "royalty sharing" contract where you could figure out percentages. I have both in a Collab Contract Bundle here is the LINK But generally speaking those that request a "work for hire" are not intending on giving you any rights to the work.
Last edited by a moderator:
C
ChrisMOE
Guest
Fatal tone...valuable information my dude. Knowing how the music world works is vital 
Val Johnson
New member
HIMbeats thank you for the information.