What Does It Mean to Own Your Masters?

Kanye, Taylor, Prince, Frank — there's a lot of talk about the importance of owning your masters these days. Read our guide on how to remain in charge of your music and find out what being signed (to most major & indie labels) actually means. 

Written by
amuse 

At amuse, our mission is to help independent artists accelerate their careers, on their own terms. We remain, proud believers, that all artists should own their masters and have the opportunity to build their music careers without having to sell the rights to their work. 

Traditional labels produce, distribute, market, and promote the music of their signed artists. There is a coordinated relationship between the label and the artist. Artists are promised a future where they can fulfill their dreams while the record label invests and profits from the music that the artist releases. However, there is a lack of accountability and openness from many major and indie labels when signing young artists, offering huge advances and prosperity, without disclosing how their agreements will affect future revenue streams.  

The music industry is broken, for artists of all sizes, and that’s why we’re here to fix it. That’s why we let artists keep 100% of their rights, even if we sign them to our label.  

What is a master recording? 

A master recording is the original recording of a song. “By definition, that makes it the most authentic supersonic account of the song. Everything else is a copy, and after that, in the digital world, a copy of a copy,” music critique Dan DeLuca wrote for The Philadelphia Inquirer.

Why is it important to own my masters? 

As an artist, owning your master recordings gives you the legal rights to freely appropriate and maximize your opportunities to make money. It gives you full control over your music. With a master recording, you can license the recording to third parties, like TV shows, films, commercials, or even for sampling use by other artists. If your master belongs to someone else, like the record label, the music producer, or sound engineer, then they have the right to license out the recording (and collect all the royalties). 

“A lot of artists, especially in the early days of their career, don’t realize that signing away your masters means selling the rights to their own work - sometimes for their entire career,” says Hannah Dudley, Head of Marketing & Promotion, Label at amuse.

“That doesn’t always feel like a priority if you haven’t had your breakthrough yet, but even Taylor Swift and Kanye were beginners at one point in their careers. For Taylor, not owning her masters meant losing power over where and how that music was used, as well as keeping her from performing her own songs live in some circumstances.”

Kanye-Masters

 

What is the difference between publishing rights and master rights?

The publishing rights refer to rights in a musical composition, words, and music. The master is the original sound recording. The difference is, that a single musical composition (like lyrics) can feature in hundreds of different sound recordings (covers, remixes, etc). Let’s break it down.

🔊 The Sound Recording = Master Rights
Owning your masters means you own the copyright to the original sound recordings of your music. The copyright of the Sound Recording is generally owned by the artist or record label that they are signed to. Whoever owns the master recordings will earn royalties when the song is played or reproduced (including radio, streaming, downloads).

✍️ The Composition = Publishing Rights
The Composition also referred to as “Musical Work” is the underlying musical elements, structure, and composition of a song. This can also include lyrics. The publishing rights are generally owned by the original writer or composer of the song. 

There are three (3) main types of royalties that come from publishing rights. 

☑️ Performing royalties: Royalties produced by live performances of a song, like festivals, concerts, radio plays, or at a public venue.

☑️ Mechanical royalties: Royalties that come from manufacturing physical copies of a song (such as CDs and vinyl records), and digital streams and downloads. 

☑️ Sync licensing royalties: Royalties are generated when a song is broadcasted through AV media (advertisements, films, video games, tv shows, etc). 

Publishing royalties relate to how an artist’s music is used. This could range from digital or physical formats, live performances on stage or in public settings, or broadcast on the radio. 

Hit this link to learn about music publishing deals.

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Where does the money come from? 💸

In a traditional agreement with a label, income will come from several sources. The label will recoup their investment before you see any money, depending on the advances, recording costs, touring and promotion costs that they have fronted. After all the expenses are recouped, the artist will receive income based on the percentage that was agreed upon by them and the label.

Income will come from things like: 

  • Master Royalties 
  • Publishing Royalties
  • Physical and Digital Sales
  • Sync Licensing
  • Touring
  • Merch
  • Remixes and Sampling
  • Sponsorships 
  • Features

Read more about the different types of record deals here

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Image: Vundabar

Traditional label deals vs. licensing deals 

In short, many traditional label deals will ask an artist to sign away their master rights to the record label for a set period of time or the length of the copyright. This means that the artist is prohibited from releasing music with any other label, distribution partner, or even another artist for the period of the contract. It also means that any recordings made by the artist are owned by the label for this period, which can sometimes be forever. In return, the artist gets an advance on future royalties. 

A better alternative is a licensing deal (which is what we offer artists who we believe in), “loaning” your recordings to our label for a limited period rather than giving up your rights for the life of your copyright. After the license term is over, you regain full ownership of your music. By owning your master recordings, you get to stay in control of your career and earnings. 

Negotiating your rights

“It’s not uncommon to see new independent artists sign a contract without fully understanding what rights they are giving away,” entertainment lawyer Chloe Martin-Nicolle tells us. “You’re better off taking some time to understand the deal by talking to someone and negotiating a deal so it works for you."

Understand the term: How long are you potentially locked into the deal? How many options does the label have? How long do they have the rights to your music?

Understand royalty payments: There is usually an element of recoupment so you won’t see a royalty straight away. Know what is and isn’t recoupable. Make sure to understand, past your advance, what you will be earning during the recoupment period. 

What can the label do for you? Are they investing in marketing and publicity? What can they do outside their city? Is it worth assigning your rights at a time when you can launch your career independently?

Read more about when and why to hire an entertainment attorney here

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