The music industry’s biggest headache? Hint: it’s not piracy [Infographic]

Never mind piracy, music artists have another problem to worry about when it comes to receiving their hard-earned royalties. This problem is actually ingrained in the music industry itself as it’s prevalent in one of its fastest growing areas – Music Licensing.

This problem is something called retitling.

A recent infographic report published by The Music Licensing Directory reveals a rather complex situation, especially with regards to the contracts signed between artists, labels and publishers. The report states that retitling is:

“where a music licensing company re-registers a song under a different title with a performing rights organisation (PRO), allowing for the royalties to be separately tracked for specific sync placements, and for the music licensing company to earn a share of the placement royalties.”

Sync placement is the strategic airing of a song across different mediums, such as in television shows, films and games. The person who decides which song to put where and when is the Music Supervisor and they deal with the music licensing companies directly.

The process of getting a song onto, say, a TV show is tricky. The relationship between artist and music licensing company (or publisher) is key. It proceeds a little something like this: artists record the song, they then sign over the rights to one – or rather many – publisher(s) in either an exclusive or non-exclusive deal and they in turn pitch it to Music Supervisors.

In a non-exclusive deal, the publisher often retitles the song with a PRO, listing the artist as writer, and them as publisher. Which, on paper, should yield a 50-50 split return on royalties. In an exclusive deal the publisher often takes a lesser fee of around 20-35%.

Retitling often results with the same song(s) being supplied to many publishers and so the same song(s) gets pitched to TV shows, films and games time and time again, albeit under various names.

The problem arises here: the Music Supervisor doesn’t know who should get the publishing royalties.

Winston Giles, CEO and Founder of The Music Licensing Directory stated that, “Music Supervisors are becoming more and more reluctant to accept retitled works, and some of the bigger studios and companies are now refusing to work with retitled works in their productions.”

The infographic reports that there are more than 1500 companies who claim to be music licensing businesses globally and a whopping 40% retitle tracks. Giles and his team have only identified 420 of these companies as legitimate.

So what’s the solution?

A new technology called “Digital Fingerprinting” could render retitling an ineffective practice. It is a system that automatically detects and identifies a song’s data and also records its broadcast details.

Giles reveals though, “some royalty collection societies have begun the implementation of digital fingerprinting, however there remains no industry standard and the adaption away from archaic cue sheets [the current manual way of recording song data] to the new technology has been very slow.”

The report showcases the problem with the current Music Licensing landscape. However this is a problem rooted more in the non-exclusive contracts between artist and publisher than just the practice of retitling.

Digital Fingerprinting could help cull the abuse of these relationships. But for artists to fully get the royalties they deserve, they need to educate themselves on the nature of the contracts they are signing, not just rely on new technologies. Otherwise piracy will be the least of their worries.

Image source: Flickr