ADVERSARIES OR PARTNERS

This is the last in the current series of 12 blogs. If you’ve found them useful or informative, please let me know.

I’m conscious that much of my advice to brands paints music rights owners as the enemy to be defeated in negotiations. I admit, with some remorse, that this was my own stance 20 years ago when I launched my previous business. However, we all tend to mellow with age and hopefully I now have a more balanced perspective on relationships with record labels and music publishers.

Let’s remind ourselves of the transaction here:

The brand, aka licensee, is looking to get the best deal it can for a commercially released music track. The brand wants the broadest rights, for the longest term, for the lowest fee.

In contrast, the record label and music publisher, aka licensors, want the best deal they can secure on behalf of their artist or songwriter. This means the narrowest rights, for the shortest term, for the highest fee.

As you’d expect, these positions are diametrically opposed. Through negotiation, hopefully a compromise can be agreed to get the deal over the line and allow the usage to proceed. Achieving a fair price requires a good understanding of cost drivers. There’s more on this topic in a recent blog post. In my book Music Rights Without Fights I describe a fair price being one where the licensee felt they paid too much and licensor felt they were paid too little. In the wise words of Mutesong’s David McGinnis, “each side is equally unhappy”.

Recognising that Resilient acts for brands, our long-standing relationships with music rights owners is key; Indeed it could be considered an asset in our ability to broker deal on our clients’ behalf. The UK’s sync community is relatively small. We deal with the same dozen or so companies many times each year and have done so constantly during the 15 years of Resilient’s existence. In some rights owners the same people have been in post for a decade or more, rising through the ranks to become head of sync licensing. Elsewhere, there’s an annual “changing of the guard” whereby sync some executives switch companies, usually for a promotion opportunity. We seek to maintain good relationships with these people wherever they move to.

The benefit of brokering many deals with a small group of rights owners means they understand how we work. I’ve always tried to position Resilient as a consultancy that “does things properly” when it comes to sync licensing. This means being buttoned down, having clear written communication, and being courteous even during tough negotiations. Clarity and consistency make for better deals, and hopefully we earn the respect of rights owners as a result. It also means on occasions where our clients’ budgets are particularly stretched, sometimes we can persuade rights owners to be flexible, leveraging a long history of past deals. This open relationship allows us to explain our clients’ challenges to rights owners, and similarly labels and publishers explain their own challenges in dealing with approval parties.

In summary, it’s important for brands, especially Legal and Procurement, to understand that striving for an equitable relationship pays dividends. For brands that regularly use commercially released music, they will return to the same small group of rights owners time and time again. Of course the brand will seek to negotiate the best deal they can get, but doing this with integrity is vital. I would always recommend:

  • Don’t move the goalposts on commercial terms during negotiations or at long form licence stage
  • Seek a fair balance in the negotiation of licence T&Cs, recognising that the song and recording were not created for use in a brand campaign i.e. this is not a commoditised product
  • Be prompt with vendor set-up, raising POs and paying invoices. This is a particular gripe of rights owners who routinely wait months to be paid by brands
  • Use the music only as authorised in the licence. Should any unlicensed activity occur, disclose it immediately and offer to make amends with additional licence fees

Finally remember that achieving the best deals, within a long-term licensing strategy, means adopting a partnership rather than adversarial mindset. You will need to do business with these people in future and they will remember if you acted unprofessionally or dishonourably.  

I hope that’s useful and please get in touch if you have any questions at richard@resilientmusic.com.