Driven by technology, music is reaching more fans in more territories, year after year
The global music industry has demonstrated a recent resurgence after 15 years of decline, but remains highly fragmented. The sector is in a constant state of change and is currently in its most fast-paced and innovative chapter in decades, with more fans listening to more music around the globe in increasingly rich and immersive ways. The evolution of streaming has not just been embraced by the music industry, it has been proactively driven by it.
Music rights are income yielding on several fronts. To best explain this, it is worth explaining the rights that exist in a typical piece of music:
This may be one person or a combination of individuals (eg. Lennon & McCartney / Simon & Garfunkel). They are the creator of the ‘composition’, writing the ‘lyrics’ and/or compising the ‘tune’ to form a song. Royalties are due to the writers every time the composition is performed, recorded, played or reproduced. This royalty is collected and paid via a variety of industry recognised societies globally and is usually collected by the composer’s publishers and paid onto the writers.
Usually an individual even if part of a collective or a band. The performer is entitled to a royalty paid subject to the contract with their record label and, additionally, via registering their performances for licences with the PPL. Globally, varying societies will have arrangements with the PPL and monies from radio plays, TV and other digital radio services with ‘pay to play’ will be provided for the licence holder.
The record label
A record label is a collective of music recordings performed by various performers that are distributed to digital retailers such as Amazon, Spotify, iTunes and YouTube. The record label invests in recordings and is both responsible for paying royalties to [writers and performers?] and receiving royalties from the digital retailers. The record label has other methods of monetisation such as synchronisation (the use of music in TV, Advertising and Film). One Media iP would fall under the record label category.
All of the Rights described above are known as Intellectual Property (IP) and have varying values and a varying legal definition of copyright life:
Writers rights typically last for 70 years from the death of the writer. In the case of a writing combo, it is the death of last surviving writer.
Master rights (the Recordings) subject to recent changes in the United Kingdom we are aligned with the EU and said Rights are now for 70 years from the first day of published release of the Recording. The USA is 90 years. Other territories may vary.
One Media aims to acquire the master rights, the publishing and the writers’ share of income. Not always all three in one deal but these can be acquired as separate purchases with varying parties.
This is achieved by valuing the income based over a variety of conditions included by not limited to:
• The integrity and quality of the recording
• Due diligence on the provenance of ownership
Rights are acquired based on negotiations on an agreed multiple of the earning history and future earnings.