Understanding Exclusive Buy Out Deals

[megeath]

Hello Everyone, I've seen listings which are 'Exclusive Buy Out Deals'. When does it make good sense to go for these? Just want to understand this piece of the Non-Exclusive, Exclusive, Buy Out picture. Thanks!

This company offers an EXCLUSIVE Buy Out Deal. They buy the Copyright and Master recording rights for $300 to $500 per song. You keep 100% of the writer's share, and make performance income on the back end from your PRO. The Publisher will get 100% of the Publisher's Share, and will split any sync fees and mechanical royalties 50/50 with you.

[Casey H]

Hi megeath

A buy out deal is an exclusive deal whereby you get money upfront such as the $300-$500 referenced here. The difference really between this and other exclusive deals is that in a "standard" exclusive deal, you would get 50% of any upfront master/sync license fee the library received. Here, that upfront money is the only UPFRONT money you can get for life. In either case, you generally receive Writer's share of performance royalties which can be lucrative in some situations.

Many (or even most) standard exclusive deals pay nothing upfront. However, if the library landed a master/sync of $5000, you would get $2500. But the key word there is "IF". No guarantees.

Buy out deals like this one can be very good ones when you consider that MANY tracks are put in libraries and never earn $300-$500 master/sync in their lifetime. Some will earn much more. Many will earn much less. It's a crapshoot. Upfront money guaranteed has a lot of advantages. But, if you have high hopes that the track(s) can get bigger/better placements, you have to weigh that.

HTH. Feel free to ask more questions!

Casey

[megeath]

Thank you Casey! That clarified it for me. Have a great day.

[FMstereo]

Casey, or anyone else who wants to chime in, can you clarify this for me please.

The deal says: "This company offers an EXCLUSIVE Buy Out Deal. They buy the Copyright and Master recording rights for $300 to $500 per song. You keep 100% of the writer's share, and make performance income on the back end from your PRO. The Publisher will get 100% of the Publisher's Share, and will split any sync fees and mechanical royalties 50/50 with you."

Doesn't that mean that you DO get a 50/50 split of the sync fees IN ADDITION to the buyout fee? If that's the case, this looks like it's the same as a "standard" exclusive deal, where you would get 50% of any upfront master/sync license fee the library received, but here you get the up front money as well.

Thanks.

Cheers

[Casey H]

Good question. Not sure if that's a typo in the listing or the way it really is. Usually in a buyout (AFAIK!!) you don't get a share of future sync fees or at least not a "full" 50%. I'd probably check with Taxi on a listing worded like that. If it is true that you share in the sync, it is more like an exclusive deal with upfront money than a buyout.

I welcome anyone else to chime in.

Casey

Casey, or anyone else who wants to chime in, can you clarify this for me please.

The deal says: "This company offers an EXCLUSIVE Buy Out Deal. They buy the Copyright and Master recording rights for $300 to $500 per song. You keep 100% of the writer's share, and make performance income on the back end from your PRO. The Publisher will get 100% of the Publisher's Share, and will split any sync fees and mechanical royalties 50/50 with you."

Doesn't that mean that you DO get a 50/50 split of the sync fees IN ADDITION to the buyout fee? If that's the case, this looks like it's the same as a "standard" exclusive deal, where you would get 50% of any upfront master/sync license fee the library received, but here you get the up front money as well.

Thanks.

Cheers

[TerrellBurt]

I did a buy out deal for three songs I worked on around the holidays and made some pretty good upfront money. But as far as I know, there are no sync fees but I will get some writer's share royalties from the library. One of the songs from the buy out deal got placed last week on ESPN. So yeah it truly is a gamble because you never know what will get placed and what won't. This is why I choose to target all kinds of listings regardless if they are non-exclusive, exclusive, buy out, etc. Diversifying is good in my opinion.

[guscave]

One of the songs from the buy out deal got placed last week on ESPN. So yeah it truly is a gamble because you never know what will get placed and what won't. This is why I choose to target all kinds of listings regardless if they are non-exclusive, exclusive, buy out, etc. Diversifying is good in my opinion.

Unfortunately ESPN is part of the Scripps Network which doesn't pay any back-end royalties (yet), so you're absolutely right that you should target different listings and try to get as much as you can upfront on these types of deals.

[Casey H]

ESPN is not part of Scripps. However, the also only do direct licensing with no PRO back end. Whether you get any front end depends on the library/deal. If it's not part of a blanket, you might get a share of the direct license fee. if it's part of a blanket deal, it depends on whether or not that library shares any part of the blanket licensee fee with composers. And yes, a buyout fee here probably earns you way more than you would through a regular library ESPN placement. Congrats Terrell on the placement!

Casey

One of the songs from the buy out deal got placed last week on ESPN. So yeah it truly is a gamble because you never know what will get placed and what won't. This is why I choose to target all kinds of listings regardless if they are non-exclusive, exclusive, buy out, etc. Diversifying is good in my opinion.

Unfortunately ESPN is part of the Scripps Network which doesn't pay any back-end royalties (yet), so you're absolutely right that you should target different listings and try to get as much as you can upfront on these types of deals.

[TerrellBurt]

Yes, ESPN is direct licensed so there won't be any PRO royalties. But for this particular library, composers do get paid direct license royalties, which I'm hearing won't be that large.

[JHoffman]

I have a question along these lines that might be pretty obvious, but I just have to know for sure. When listings say, "This company offers an EXCLUSIVE deal. You'll split all upfront sync fees 50/50, (which can be very substantial for Trailer Music). The Publisher will get 100% of the Publisher's share, and you'll get 100% of the Writer's share." OR
"This Library offers a NON-EXCLUSIVE, 50/50 Deal. You'll get 50% of any applicable sync fees and 100% of the Writer's share. The Publisher will get 50% of applicable sync fees and 100% of the Publisher's Share on the version they pitch."

Does that mean the Library is the Publisher or that if I own the Publishing I get it?