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I have recently learned that some music libraries are becoming "Performance-Free" companies. What this means is that a composer receives an upfront payment for a song and is not entitled to ANY backend royalties. It is a direct license. Would this business model be lucrative or harmful for you?

INFO: http://pmamusic.com/how-performance-fre ... -industry/

Yeah, I got an email from a well known big library this morning requesting this type of deal. They wrote it's the future and that it will hurt sales if I opt out of this. They suggested to see it as part of "the market mix", I guess using a portfolio mindset like you would on the stock market.

If chosen, it would imply that I cannot register tracks under this deal with my PRO, as they will not allow this type of deals. So I guess, if performance-free is the future business model, it will be in conflict with the PRO based system.

I'm happy to see PMA's approach to this. So my gut reaction is that I will withdraw all music from this company, and forget all about them for future licensing, but still courious what other posters think.. is there a straw of sympathy out there for this?

Always interested in your opinion DI.

Michael.

michael11 wrote:Always interested in your opinion DI.

Michael.

Quoting myself!!!

That’s novel.

Got your opinion on MLR.

Can you PM me the name of the library?

Thanks.

Michael.

I can't see a Library like that getting or keeping quality music from quality musicians. But, isn't this the same as "royalty free" stuff I hear about?

Russell

I know that there is a small but hardcore group of composers that would only prefer to have music in a performance free music library. Some people have a deep dislike and even a hatred of the PROs. By doing direct licensing with a performance free music library, these composers would be choosing to get paid upfront and rejecting backend royalties.

I think this model will not be adapted by PRO composers, at least not initially. But to be honest, I think that the performance free model will be adopted by many micro stock sites and by some non exclusive retitle companies. Royalties from PROs are not the best for smaller companies. They would probably go for splitting an upfront payment with the composer instead of waiting for publishing royalties to come in.

My main question about this model is will there be blanket licenses? A blanket license usually implies that a composer receives no upfront money. The performance free model would provide no backend royalties. So the only winner of a blanket performance free music library is the library itself. Licensing a boatload of tracks on the cheap with this model completely cuts the composer out of the picture financially.

My guess is that the big company that is moving towards the performance free model will initially not do blanket licenses. But they will eventually end up changing the terms with a slight-of-hand and will then offer blanket licenses. From reading the email I received, they are leaving the terms of the contract vague so that they can make such changes without prior consent. Composers will have to opt out, and may pretty much have all of their music removed from the library.

Even if there are no blanket licenses, will payments for individual licenses go up at all? Will people still be licensing music for $10 and splitting half with the music library?

It's very important to understand the difference between Royalty Free libraries (RF, which have been around for a very long time) and "Performance Royalty Free" libraries, which is a new model.

In most cases, with traditional RF libraries, in addition to the upfront license fee, you could collect PRO money if the placement ended up in broadcast. Most RF libraries will assist in filing cue sheets with PROs.

This PRF model is such that you could never collect PRO royalties on placements. If you received a small upfront license fee, that's all you'd ever get regardless of what happened with the placement (e.g. ended up re-running over and over on TV). And if libraries start doing blanket deals with this model, even if they gave you a pro-rated share of the blanket fee they received, it would amount to very little.

Personally, I think this new model is dangerous and I would avoid any involvement with it. I don't currently have tracks with the library that just sent out that email (I used to), but if I did I would write to the library letting them know I do not support this model and ask that they withdraw my tracks.

Casey

Thanks for the clarification, Casey.

I agree. If I had anything in a library that wanted to switch to "Performance Royalty Free," I would yank my tracks as well. And, I wouldn't put any of my stuff in one.

My previous comment still stands. I can't see any future for that business model.

Russell

Casey H wrote: Personally, I think this new model is dangerous and I would avoid any involvement with it. I don't currently have tracks with the library that just sent out that email (I used to), but if I did I would write to the library letting them know I do not support this model and ask that they withdraw my tracks.

Casey

I agree Casey. I plan to stay away from these types of deal. There is just too much that you can wind up giving away.

Looking at this controversy elsewhere, it was mentioned that by law networks, if your music is used on TV , are required to pay the PRO's.. So essentially if you sign off on this, you are giving up both your entire publisher's share and writer's share to the library. So how ethical is that?

Looked at in that way, absolutely not. And if you agree you are doing a disservice to your fellow composers.