Using the example of a song written by Diane Warren called "Unbreak my Heart" which was licensed for use in a Citibank commercial, Bernstein explains that the continued availability of the commercial on YouTube after its scheduled TV run harms the market for further licensing of that song:
Okay, so why should anybody care if this is on YouTube. It seems pretty harmless. Somebody was a fan of the spot, they found it funny, which should make Citibank happy since that was the point, and they decided to put it on their YouTube page.(I would point out that if Warren (whom I believe is the copyright owner) believes her song is being performed on YouTube without a proper license, she can always send a takedown notice. And then another when it gets re-posted. And another....)
The reason is this, music supervisors do their homework. If you are hired to find and license an appropriate recording for a client’s commercial you begin by executing your creative search. Trying to find music that is appropriate for the creative vision of the commercial. Part of that search is to check into the previous uses of each song that may be a viable option. Yes, clients will license songs for use in advertising even if they have been used by other clients at other times. That being said, if the commercial is still drifting around in cyberspace the chances of that song being re-licensed, especially in the same product category, can be greatly diminished. If you are doing a creative search for Bank of America and you punch Citibank and “Unbreak My Heart” into Google, this video comes up at the top of the list. This would probably not enhance Diane Warren’s chances of re-licensing this composition to Bank of America.
Sure, the odds may be against another financial services company ever wanting to license “Unbreak My Heart”, whether or not it was used by Citibank. But what if there is a chance, and what if you do not have a Diane Warren back catalog bringing in constant revenue. Would you want to potentially miss that opportunity because the spot is viewable on YouTube after the publishing license has expired. Probably not.
And while he's on the topic of how songwriters and publishers earn revenue, Bernstein also reminds us that the frequent admonitions to the record labels and their artists that they should stop trying to charge for music itself and instead focus on making money from scarce goods such as concert tickets often ignores the songwriters and composers (and publishers) altogether:
There is a lot of talk these days about giving away music for free. Using it as a loss leader to generate email lists, create tribes and to help enhance other revenue streams such as merch and concert tickets. All of those are perfectly reasonable ideas. But they do no nothing to help the songwriter. If the composer is not the performer, they do not get a piece of ticket sales or concert t-shirts or the fragrance or shoe line.By the way, I highly recommend The Licensing Plate as a valuable source of news and blog posts about IP licensing issues. The site is very comprehensive, frequently updated, and well-designed.
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Well, it is an interesting post from a music licensing perspective, but it ignores the advertiser's perspective, which does benefit from the on-line exposure.
ReplyDeleteWithout metrics, though, it is hard to know how big an issue this is. Clearly it exists. But, are the benefits greater than the problems? Is advertising really all about the benefits to a limited number of musicians? So, putting ads on line affects music clearance but I don't think the answer is "don't put ads on line" the answer is "don't license music you can't put on line."
-Todd
« Bernstein explains that the continued availability of the commercial on YouTube after its scheduled TV run harms the market for further licensing of that song »
ReplyDeleteDoes it? Research has found that the more a song is played, the more people like it. It's as simple as that. That doesn't make it legal, of course.
To nixar:
ReplyDelete"Research has found that the more a song is played, the more people like it." That may be true (though there are certainly plenty of songs that I despise more and more each time I hear them), but Bernstein's point is that if a commercial with a song is played beyond the song's license permits, other advertisers will be less likely to license that song in the future. And I doubt...unconventional uses like the one in the Citibank ad will really increase sales of the song itself.
"If the composer is not the performer, they do not get a piece of ticket sales or concert t-shirts or the fragrance or shoe line."
ReplyDeleteSounds like composers could use a new business model as well. Nothing wrong with that.
To Anonymous 1:07:
ReplyDeleteComposers (and songwriters) now have basically 3 revenue streams: 1) mechanical royalties (sales of CDs and downloads); 2) performances (play on radio and public venues); and 3) synch licenses (uses in movies, TV, and commercials). In the absence of copyright, all 3 of those streams dry up. Nothing wrong with "new business models," but care to suggest one that replaces all that revenue?
One business model to replace three? Nope, not off the top of my head, sorry. I have a hard time believing they'd all dry up without copyright law anyway, so I'm not too worried about the songwriters or the musicians. The music industry can (and often does) do fine without copyright. Now copyright lawyers? They might be in trouble ;)
ReplyDeleteTo Anonymous 6:45:
ReplyDeleteYou write: "I have a hard time believing they'd all dry up without copyright law anyway..."
Today, licensees are required to pay for those uses. In the absence of copyright, they could do the exact same thing for free (i.e., without paying the songwriters and composers. Why would they keep on paying? Why *wouldn't* those revenue streams dry up?
I'm genuinely interested in hearing ideas about how songwriters and composers (especially those who don't perform themselves) could make a living in the absence of copyright. I suppose some rich guy could hire songwriters to write songs for his own amusement, but that doesn't seem like a viable business model to me when the rich guy can't make $$ from licensing those songs for other uses.
Songwriters/composers could get their money from the same people they always have, it'll just require different negotiations. No matter how musicians get their money without copyright or by giving away the music and earning $$ from scarce goods (t-shirts and concerts are always the examples, but there are plenty more), there's still going to be a demand for songwriters and opportunities for them to continue making money since their time is a scarce good as well.
ReplyDeleteTo Anonymous 2:37:
ReplyDeleteYou write: "Songwriters/composers could get their money from the same people they always have, it'll just require different negotiations." But absent copyright, why would today's licensees negotiate at all? Today, if a film producer or commercial-maker wants a song in his movie or ad, he negotiates a license from the copyright owner(s). With no copyright, they could just use the song -- no negotiations or license fees required. Similar story with radio stations, public venues, etc.
"[T]here's still going to be a demand for songwriters and opportunities for them to continue making money since their time is a scarce good as well." That's a nice sentiment, but it's very vague, and doesn't explain why people are going to pay songwriters very much for their "time" if, once a song is written, anyone else can use it for free (which would be the case with no copyright).
"But absent copyright, why would today's licensees negotiate at all? Today, if a film producer or commercial-maker wants a song in his movie or ad, he negotiates a license from the copyright owner(s). With no copyright, they could just use the song -- no negotiations or license fees required. Similar story with radio stations, public venues, etc."
ReplyDeleteBut you're still looking at the negotiation as including a synch license. I'm saying that with the three revenue streams you mentioned drying up, there can still be revenue streams that work despite the fact that the music itself can be given away for free as an infinite good and without copyright. Maybe instead of the songwriter licensing the song, they can be paid a flat rate. Maybe a songwriter could gather some samples and shop themselves around to get a contract to write songs exclusively for a label or an artist. Other deals can be brought to the table to compensate songwriters without including licenses for how the songs are used, and people smarter than me are sure to figure them out.
"That's a nice sentiment, but it's very vague, and doesn't explain why people are going to pay songwriters very much for their "time" if, once a song is written, anyone else can use it for free (which would be the case with no copyright)."
People are still going to pay songwriters because they still need material. Even though the business model has changed from selling plastic discs to giving away the music and selling scarce goods, the music and the songwriters are still very much needed for those new business models to function. Why wouldn't musicians still need good material? The music might be free, but it's still valuable to the business models because it's the reason people become interested and connect with the musicians and support them through whatever means are available and appealing. It should be obvious that musicians aren't going to sell anything at all if the music they're making isn't any good.
"Maybe instead of the songwriter licensing the song, they can be paid a flat rate."
ReplyDeleteAgain, why would anyone pay a "flat rate" (a form of license fee) if they don't have to?
"Other deals can be brought to the table to compensate songwriters without including licenses for how the songs are used, and people smarter than me are sure to figure them out." Again, nice but vague. Saying you don't have the answer but other smart people will figure it out doesn't really answer the question.
"People are still going to pay songwriters because they still need material." Sure, some may do this. But lots of others will just use stuff without paying for it (which would be perfectly legal in the absence of copyright).
In any event, this discussion is truly academic. I don't know of a single Member of Congress, judge, or academic (even on the copyleft) who actually believes that copyright should be abolished. Remember: last year the House passed the PRO-IP Act with only 11 "no" votes, and the Senate passed it by voice vote. There is no support whatsoever in Congress for abolishing copyright.
Why else would a songwriter write a song if they're not being paid unless it's for their own use? And how successful do you think these artists can be if all they're doing is playing other people's music? I think the market would demand some originality, which the artists should strive for if they want to gain an audience. No one's going to get anywhere if they're all playing each other's stuff.
ReplyDeleteDespite not having a business model that's going to work for all songwriters, that's not why I came to post anyway. I originally said that I see nothing wrong with composers needing to come up with new business models, and I still stand by that. My point in tossing out vague ideas when you asked for new revenue streams is that even if money could no longer be made from music sales and licenses but from other scarce goods, songwriters are still very much a part of the music business, and because what they bring to the table is a valuable scarce good, then there's money to be made.
Lastly, I don't trust too many in Congress to do anything that will promote innovation in this area, and I was extremely disappointed (though not exactly surprised) to see the PRO-IP Act pass. Why the government should support failing and increasingly obsolete business models is beyond me. While I actually do think copyright has a place in today's world, it needs to function as it was originally intended and promote innovation and the creation of new works, and that would require some serious recalibration. Sadly, it's become a welfare system for the music industry and stifles creation instead of encouraging it, which is probably another discussion best saved for a future blog post.
What if there is no music in Commercial ad..??
ReplyDelete