Sync Fees vs Backend PRO payments

[thegajman]

Someone I know (not me unfortunately! ) has been offered an exclusive deal for a song. It is a buy-out situation where the company pays an up-front payment to secure the ownership of the master and the copyright, in perpetuity.

The company has a great track record for big TV placements, but my understanding is that they take ALL of the sync fees (ie. they not only take the publisher's share, but they also take 100% of the writer's share as well). In addition to this, since they buy the master, they take all of the master-use license fee as well. So apart from a (negligible) up-front payment, the only income that the writer gets from such a deal is from the back-end.

I have no experience with either the sync fees or the back-end performance royalty payments that a placement in a prime-time CBS show could offer.

What I would really like to hear from you guys (that may know from actual experience), is how do the back-end PRO payments compare in % terms to the sync fees?

My "guess" is that the back-end payments would be lucky to reach 10% of the sync fee for a big placement. I have heard that the sync fees can be at least $10K-$20K for the types of shows I'm referring to above.

I don't need to know anyone's $, but I would really like to hear about the relative % between sync fees and back-end payments. With that information, it will be a lot easier to tell if this deal is even worth considering.

(I realize that one way to look at this kind of deal, is to be happy that you at least get some up-front money, even if the song never gets placed, but IMHO the song in question is actually really unique and incredibly place-able).

Thanks guys!

[DesireInspires]

If the upfront fee is high and the song isn’t a favorite of favorites of the composer, I’d say go for it.

It is difficult to know if the backend will be >>> than the upfront fee. The upfront fee could be the only money the composer would see. There are so many variables that it is difficult to make a decision.

But I do think the upfront fee should be a few thousand bucks.

[thegajman]

Thanks DesireInspires.

It’s a vintage song that charted in it’s day, so definitely a “favorite of favourites” as you put it.

The upfront on offer is in the hundreds rather than thousands. The more I think about it, the more I think he should push for a 50/50 deal. The buyout with 100/0 just doesn’t cut it.

I’m still keen to find out more about those back-end payments though.

[guscave]

Hi,
I've done a few buyout deals where they keep 100% publishing and I don't get any sync, and they've paid me anywhere between $150 to $500 upfront. However I never give away my writer's share. There really is no need for a publisher or client to get your writer's share. You never know how much that can earn in back-end royalties. I have songs I've written more than 7 years ago that have made me over 4 figures in back-end royalties and still pay til this day.

[Kolstad]

Backend might become less and less, as everyone moves over to streaming. So signing off music to exclusive deals with little front end might be a bit risky in todays business environment, imo. Chances are that you’ll see little more than the upfront fee, “in perpetuity”, so make sure you are happy with the contract.

[DesireInspires]

Backend might become less and less, as everyone moves over to streaming. So signing off music to exclusive deals with little front end might be a bit risky in todays business environment, imo. Chances are that you’ll see little more than the upfront fee, “in perpetuity”, so make sure you are happy with the contract.

I agree.

I wouldn’t say no to all exclusive deals, but I would not chase those deals.

Keeping control of your catalog, even a portion of your catalog, makes a lot of sense.

[thegajman]

Thanks everyone, great advice!

[jonnybutter]

It also matters in which country you are liable to get royalties from. If you are shooting for mostly US placements, then perhaps the backend situation might look tougher; but foreign (from US vantage point) royalties can be nice, depending on countries. And unlike US and Canada, you can get royalties for your movie music as well as broadcast.

In my limited but growing experience, I'd say that what matters most is signing with really good publishers that get nice placements, rather than worrying primarily about ex vs non-ex. If it's a great publisher, your backend should be pretty good over time. If it's a publisher that is not really clear on what they can/can't use and just signs tons of stuff, it might not matter what your deal is - you'll prob. get little or nothing on the backend (or the front end!).

my 2c YMMV

[Casey H]

Some things to consider:

The AVERAGE income over lifetime for any single track you put in a music library is not all that high when you consider many never get placed, some get placed for no sync fee (backend only), and a small percentage may earn a sync fee of $500-$1K. Yes, there will be the VERY occasional larger sync fee($3K, $5K, etc.), but keep in mind how few and far between these are. So it's quite possible that the upfront free here is more than the average lifetime earnings for a Film/TV track. I have tons of songs in solid music libraries that haven't earned even $200-$300. (Others better, of course).

Back end payments CAN be lucrative but of course, that can vary from coffee money to hundreds or even thousands, lifetime. But that's true for ANY track you place in a music library.

Keep in mind that a library that pays an upfront fee has a strong vested interest in getting your music placed since they invested their cash in it. Contrast this with a library that paid nothing upfront and added you to their large catalog. (Not saying those are bad deals, but those deals are more the norm). So they will work very hard to place your music.

What other opportunities do you see in the future for the track? It certainly doesn't earn money sitting on the shelf so unless you have something more lucrative available, the "bird in hand" is a good way to think about it.

But... If someone is VERY married to the track and can't live with giving it away forever, that's a factor. It has to be comfortable for YOU.

HTH
Casey

[DesireInspires]

It also matters in which country you are liable to get royalties from. If you are shooting for mostly US placements, then perhaps the backend situation might look tougher; but foreign (from US vantage point) royalties can be nice, depending on countries. And unlike US and Canada, you can get royalties for your movie music as well as broadcast.

Yes, definitely true for me. My international royalties have been steadily growing while my domestic royalties remain stagnant.