Why so many non-exclusives?

[andreh]

In many of his recent interviews, Michael L. really seems to be emphasizing the value of exclusive contracts. He also says (and his interviewees seems to agree) that music libraries don't like to take music that may exist in other libraries.Yet, the majority of library listings are for non-exclusive agreements. At last count 16 out of 25 regular listings were non-exclusive, and none of the Dispatch listings were exclusive (in fact I don't recall ever seeing one in Dispatch).I'm not complaining; there are enough of each for us to submit to. I'm just wondering why there are so many non-exclusive offers around if libraries are hesitant to use material that may exist elsewhere or be being pushed from two or more sources.Andre

[arkjack]

That's a good question andreh..... I want to see what others have to say before I give my thoughts.... I don't really have any extensive experience in deals, but I do know business...... my thoughts would only be thoughts...'ArkJack

[Casey H]

My take on "why"... There are dozens of new music libraries popping up every day. Everyone seems to want to be in the film/TV placement business. The newer libraries without a track record have a hard time getting artists to sign exclusive contracts. No artists/no songs, no business. I live on both sides of this business and see how hard it is to get an artist to sign a contract. Everyone is scared (I don't blame them, I'm equally cautious when I am on the other side of the fence) and legal review is costly. This competition is also making the typical upfront master/sync fee drop. There is so much music around that film companies can often get what they need for as little as $500.I was just offered an exclusive by a New York based library. Since, they showed no track record of placements on their website, I asked if we could do it non-exclusive. They quickly turned around and sent me a non-exclusive contract. They need the songs. Casey

[gitarrero]

good question - what does taxi say to this argument?Jiiiiiimy..!

[arkjack]

I think Casey hit the nail on the head.... if they already have a customer waiting in the wings for the tune and insist on an exclusive... that's one thing. but if they're just in an accumulation mode and shopping to no specific customer, I don't think its fair to tie up the music. So if the track record is good and the risk of non-placement is low, then it does become a competetive strategic decision....AJ

[matto]

For what it's worth I've never seen Michael voice an opinion for or against exclusive deals; I'm not sure where you're getting this info from Andre...However in the recent interview with Steve Corn, Steve points out some of the drawbacks of non-exclusive deals, which I thought was a rather a good thing, since many people understandably (but mistakenly) assume that non-exclusive is always and automatically better for the writer.In my experience the big players, those libraries that have tons of daily network placements and who everybody wants to write for, almost never do non-exclusives. These companies usually pay a decent junk of money upfront in exchange for exclusive copyright ownership, they own big catalogs that are distributed worldwide, and they really can't deal with the complications associated with non-exclusive deals.Nor do they need to offer non-exclusives since they have writers practically beating down their doors... So where do the non-exclusives come from?Some are smaller companies or start-ups who either don't have the clout, or perhaps no interest, in an exclusive situation. A non-exclusive also puts a lot less pressure on the company to get a song placed, and usually doesn't require them to pay an advance, which means such companies can be run on a shoestring budget since the have no significant overhead.A rather newer trend are companies that don't usually call themselves "libraries" per se, but rather "licensing companies" or something like that. Their business model is representing the hordes of indie artists who dream of a record deal, to the film/tv industries. Obviously an exclusive deal wouldn't be feasible in a situation like that, as that would preclude the artist from still shopping themselves for that artists deal. So non-exclusives tend to be the norm there, although some companies will ask for exclusivity vs the film/tv industries.Some of these companies are run by well-respected industry veterans with tons of connections who do a really good job, others...not so much. For an indie artist with 2 or 3 self released records, this kind of company can be a good match...it's just important to realize that, no matter how good the company may be, that size catalog is not going to earn you a living from film/tv placements. To do that, you'll need a catalog of a few hundred well-represented tracks.And anybody who is prolific enough to write that much probably won't mind giving some exclusives to a company with the clout, market penetration and distribution system to ensure them a solid royalty stream for years or even decades to come.So...what may be the right thing for you all depends on your situation... Wait, nobody asked about that ...but anyway that's my take on the "non-exclusive" listings. matto

[andreh]

Great explanation Matto - thanks.I suppose I haven't heard Michael openly voice his opinion about the subject either; I'm inferring it (possibly incorrectly) from the questions I hear him asking his interviewees, who have always been pro-exclusive in the interviews I've heard or read.In fairness, Michael may be impartial to either approach...and either way is fine with me. The question was more about industry practices than about Michael's opinion, and you've all provided good info (and some good speculation ) about that.Andre

[gitarrero]

thanks matto for the details - good to know!

[horacejesse]

Matto, have you ever committrd tracks to an exclusive deal that never generated anything more than the advance money? And how big should that advance money be for a 3-5 year exclusive deal for 1-3 tracks?

[Casey H]

One thing I want to mention (my 2 cents) is many new artists like us will be offered exclusive contracts with NO money upfront. As unknowns we have little clout there.So, as I think it's been stated, it usually comes down to who is offering the deal, even with no upfront money, and what their track record is. If you are offered an exclusive with a company that has a solid track record of placements (major TV networks, film, trailers, advertising, etc) -and- the contract looks good overall (a reasonable reversion clause, percentage split, etc), I would say take it. Of course, have the contract reviewed by a good entertainment attorney. Casey