Sync Licence Requests: Approval Chains
Most music publishers and record labels can’t immediately provide a definitive answer to sync licence requests from brands or ad agencies.
The reason? There are usually approval parties and, in some cases, longer approval chains involving multiple parties.
Brands looking to license commercial catalogue music often come unstuck as they fail to appreciate the timescales needed for clearance. Why? They don’t understand the number of parties involved in the approval chain. In this post I share how it works…
Licence Request – Outbound Process
Approval or Denial – Inbound Process
(i) Licensee location
Firstly, let’s refresh ourselves on some terminology:
- Licensee: The buyer – The brand or its agency
- Licensor: The seller – The music rights owner (music publisher and/or record label)
The location of the licensee entity dictates the market (or “territory” in music licensing jargon) in which the deal must be brokered.
Let’s say you work for the UK subsidiary of an American Corporation. The UK subsidiary is likely to be a UK registered company. Therefore, your UK company will need to broker music licences with the UK subsidiaries of the music rights owners who control the music track you want irrespective of the location of the original rights owners or nationality of the artist or songwriters.
Yes, I know that’s a bit complex, so let me explain using a real life example:
In 2013, Taylor Swift appeared in a Diet Coke commercial which featured the title “22” from her “Red” album”. Taylor Swift is of course an American artist and The Coca Cola Company (TCCC”) which owns Diet Coke is headquartered in Atlanta, Georgia, USA.
It’s therefore a reasonable assumption that this deal was brokered in America.
Ignoring the artist’s actual appearance in the commercial, let’s consider the music title “22” – specifically the sound recording. As an artist, Taylor Swift is signed to Big Machine Records in America who control the recording of “22”. This is licensed through Universal Music in the UK who have the right, subject to the artist’s approval, to grant sync licences for this recording for use by brands.
Let’s consider now what would happen if the Diet Coke campaign had been created by TCCC in the UK and not, as I’ve assumed, the head office in Atlanta, Georgia. Looking specifically at the sound recording, the process would be:
- TCCC UK must approach Universal Music UK with a master sync licence request
- Universal Music UK refers the request to Universal Music USA
- Universal Music USA refers the request to Big Machine Records
- Big Machine Records refers the request to Taylor Swift’s management
The key point here is this:
Even though both the artist and the brand is American, if the campaign originates in another market (e.g. the UK), the local office of the brand (or its agency) has to approach the local record label that controls the recording in that market. TCCC uK could not directly approach Big Machine Records in the USA but instead must approach Universal Music UK as the local record label. The market in which the campaign originates determines the market in which the music must be licensed, even if it’s on a global basis.
(ii) Local licensors
Looking at the previous example, you’ll start to understand how the approval chain works. We established that, if you’re working for a UK registered company, it’s your office or agency that must be the licensee if you’re commissioning the campaign.
The local licensors will be the UK offices of the record label and music publisher(s) who control the title you want to use. They could have one of two roles:
- They’re probably the original rights owner if the nationality of the songwriter / artist is British.
- They’re probably just licensing rights on behalf of an overseas rights owner if the nationality of the songwriter / artist isn’t British.
The key word is “probably” because there are exceptions to the above:
- Some British artists sign record deals directly with record labels in the USA or Europe. The same can be true for British songwriters with American and European music publishers.
- Some European or American artists sign record deals with UK record labels. The same can be true for European or American songwriters with UK music publishers.
What does this mean for marketers?
You need to establish early on if the UK record label and music publisher you’ve approached are the original rights owners who deal directly with the music talent, or if they’re acting on behalf of overseas rights owners. In the latter case, UK record labels and music publishers will likely have the ability to act on behalf of overseas rights owners once their approval has been granted.
(iii) Copyright owner / Approval party
We’ve established that you need to approach the local UK offices of the relevant record label and music publisher – but in most cases they can’t just immediately agree a deal with you. Any quote they provide will be marked “subject to approval”. There are number of potential scenarios here:
- The local UK record label or music publisher actually owns the copyright but the British artist or songwriter has the prior right of approval for sync licences.
- The local UK record label or music publisher just administers the rights of the British artist or songwriter whose own UK company is the original rights owner and has prior right of approval for sync licences.
- The local UK record label or music publisher just administers the rights of an overseas affiliate who in turn controls rights on behalf of an overseas artist or songwriter. The overseas affiliate has prior right of approval for sync licences.
It’s safe to assume that whoever you approach with a licence request will always need to seek someone else’s permission. There are examples with older catalogue, e.g. pre-1970 where this isn’t the case, but this is less common. So, there will almost always be an approval party who may one of the following:
- An artist or songwriter
- The estate of a deceased artist or songwriter
- A manager or lawyer acting for an artist or songwriter, or their estate
- An “original rights owner” who controls rights on behalf of an artist or songwriter, or their estate
(iv) Artist and management
It’s uncommon for sync licensing teams within record labels and music publishers to deal directly with established artists and songwriters. Licensing teams usually liaise with the managers of those artists and songwriters.
The manager typically handles all aspects of their client’s career, acting as a filter for incoming licence requests, especially ones for brand campaigns. The manager will immediately know if the “fit” feels right. For example, if their artist is an ardent vegetarian, they will immediately deny a request for any meat-based product or brand. They wouldn’t risk offending their artist by presenting the request.
Similarly, if an artist is below the legal drinking age or has had problems with alcohol addiction, the manager will know not to present any licence requests for alcoholic beverage brands – the requests would just be denied.
So, let’s assume that the manager considers your request sufficiently worthy to present to the artist. Will you get an immediate answer? No, almost certainly not.
Established artists and songwriters are busy people. You need to consider that they might be:
- On tour
- In the recording studio
- Shooting a video
- In writing sessions
Given that established artists probably make more money now through touring rather than sales of recorded music, being away on tour is the more likely option.
It’s quite probable that it might be several days before the artist gets to see your request. They may be eight hours behind or ten hours ahead. Their tour manager has to pick the right moment to present a bundle of licence requests to a jet-lagged artist on the tour bus or plane between shows.
Will your request stand out? Will the artist look on it favourably? Of course that depends on:
- The brand
- The usage
- The offered fee
What’s the take-out for marketers?
Remember to leave plenty of time as artists and songwriters will, at the very least, take a few days to respond and sometimes several weeks.
- Brands are licensees, music rights owners are licensors
- The market in which licensee is located dictates the licensor they approach
- The licensor will almost always have an approval party
- The approval party may be the songwriter or artist
- The approval party may be a separate overseas copyright owner
- The approval party has the absolute right of approval
- Brands should allow a minimum of one week for approvals
- Brands should expect that approval may take much longer
- Brands should have a back-up plan in the event of a licence denial
For a complete guide to sync licensing for brands and marketers Music Rights Without Fights is the 'must have' book / manual for negotiating this complex landscape. Get your copy here.