Another thread about Foreign Placements

[jonnybutter]

The original assertion was that royalties in tv music is fading as a source of income, and I think the DD thread does suggest that this is the case relative to the fairly recent past; the difference between a microscopic payment and an even more microscopic payment doesn’t seem all that important. The number of placements you need to earn appreciable backend income seems to be growing, compared to the recent past. There are more channels, more programming, and more people creating music, so there is a ton of pressure on rates of return to the composer. I would love to be wrong about this, so someone please correct me if I am!

However, I can see that your math (Andy) is correct - if our assumptions are all reasonable, the online rate is higher for that network (although the b’cast absolute numbers are still a lot bigger). I don’t know how typical that network is, but we can stipulate that it is typical. If those rates hold as people switch over to streaming, that is good news. It’s not *great* news though, because it’s just not that much money for most people. There’s no ‘middle’ - just a long tail. You either get millions of streams and make real money on the backend, or you get peanuts. And when broadcast networks (as such) disappear, you won’t be getting those much higher sync/backend payouts anymore - they will just be streams like any other, presumably. As ML suggested in that cited thread, maybe it's time for everyone to get together and overhaul this system.

Anyway, looking back, I can see that I hadn’t grokked everything you were saying:

conventional royalties AFAIK are calculated on a "viewer" basis. Shows like Duck.... have a lot of viewers, and so if they play in prime time on big networks will get the highest royalties per viewer.

So the conventional royalty is based not just on the number of viewers, but successful shows get a higher royalty per viewer? So conversely, if you have a show few people watch, on a minor network, not only do you get a smaller royalty based on fewer viewers, but you actually get less per viewer too? Wow. If conventional royalty rates are not linear, then that messes with our above calculations doesn’t it?

This is an opaque subject! And we didn’t even get around to foreign royalties!!! Now I have a headache

Note: I have not watched this week's Taxi TV, which I believe addresses this general subject, so I'm going to go do that.

[andygabrys]

Yes Jonny,

AFAIK TV in general is driven by advertising dollars.

Ad time buys on channels where more people watch (i.e. Big 3, national vs. local, Major centers vs. the middle of Iowa, big cable networks vs a one off local channel etc), at more popular times (i.e. where we get prime time from - right now 8pm my kids are in bed, I guess this is prime time - which probably started at 5 or 6 pm when most people start eating dinner and watch TV to abstain from any conversation like "how was school today" lol) are more expensive. Tv advertisers will pay more because the ads will be seen by many people, leading to greater market knowledge of their product.

So the general rates that we get paid are going to rely on a similar scheme. I don't know absolute numbers other than to analyze my statements, as the PRO's are notoriously opaque when it comes to giving up any information about how they actually calculate royalties.

So its combination of when the show airs, which channel it airs on, and how popular the show is - all a bunch of information that we really don't have much access to - other than to look at a show like "Catfish" and go - wow MTV pays pretty well, guess I should write more music for Catfish

Yes I agree that traditional royalty rates are not linear, and so its hard to make any absolute calculations - other than to see if one payment or another is an order of magnitude bigger or small - something that is statistically significant. Absolute numbers are harder to calculate, but relative numbers and trends are more easy to see.

Hard to say what that will all mean in the future. Maybe there will be so much content online that you can still make reasonable money. For the mean time I don't think TV is going anywhere. Maybe in 25 years we will see a dramatic shift as todays generation that are born into iPhones then chooses to continue to stream entertainment instead of watching conventional TV.

[jonnybutter]

Illuminating as always. Thanks Andy