A lot of artists own copyrights and master rights. Yet copyrights and master rights are the two terms I have heard being used interchangeably most often in the music industry, especially by artists. Let me get one thing clear: they can’t be used interchangeably. Artists use master rights when talking about publishing, royalties when talking about copyright, and creative copyright when talking about masters. It’s an unnecessary mistake, it makes you look unprofessional and it could even work in your disadvantage in possible negotiations. So here is a definitive explanation of both rights and the differences between them. It’s important to highlight because in today’s DIY-intensive world a lot of artists end up owning both rights.
Differences between copyrights and master rights
First of all it’s good to get a proper grasp on both rights separately. What exactly are copyrights and master rights?
The owner of the master rights is in fact literally the owner of the recordings. As a general industry rule, this means that whoever paid for the studio is the owner of the recording, unless agreed otherwise beforehand. So let’s say you’re an artist, you have rented out a studio, gotten together a merry band of musicians and recorded the sickest new tracks. You are now the proud master owner, but a label is sniffing around and is interested in your act. They might be interested in buying your master rights or licensing them. This enables them to then exploit the masters and earn money off of your master – with a percentage going to you as the artist, of course. No one can exploit your master (or a specific recording) without your permission (and of course, giving permission = receiving money).
It’s called a master right because the music used to be stored on master tapes back in the good ol’ analogue days. So the owner of these master tapes was the rights holder, since he could license factories and third parties to reproduce the master tape. Of course nowadays no one uses master tapes anymore but the term has stuck.
Who owns these rights?
So again, whoever pays for the studio is the owner of these recordings. Of course you can make a deal with a third party however you see fit. Either they pay for the studio or they can also buy or license the master off of you. Make sure to register all the masters you own with the appropriate neighboring rights organisation so you can collect more additional revenue. If you have any questions about this, please let me know. I will dive into this a bit more in the future.
Now, copyright is quite different from this. Copyright comes into existence as soon as a creative work is created. So this means that as soon as you have written a song copyright has sprung into existence and that you own it as a creator. There are some caveats, of course. If you create a work of art in assignment for a company (employed or freelance) the copyright will revert to the employer or the company (the duration of copyright on works for hire is also different, check out this website for more information).
Copyright used to expire 50 years after the death of an ‘author’ or creator, but thanks to Disney, who are harrowlingy afraid of losing control of all their creative assets, it has become 70 years after the death of a creator. Of course once we start approaching the 70th anniversary of Walt Disney’s death (2036) there is a high probability that Disney will once again try to extend the copyright term in their favor. Hard to imagine a world where everyone can use Mickey Mouse’s likeness.
This means that if you write a hit song, and you don’t sell or sign away all your rights 70 years after your death your inheritors will be able to reap the benefits of your hard work. (Talk about leaving a legacy for your offspring!) Of course you can also bring your music under in one estate and assign someone or multiple people to watch over this estate after your death (such as Marvin Gaye or Kurt Cobain have done). This estate draws up rules and guidelines on using your likeness, master recordings, copyrights, and so on after your death. Can your estate use your likeness to develop a hologram, for example? It’s good to set up some guidelines on matters like these.
Contrary to master rights, anyone can record a copyrighted song. It’s up to the PRO’s to track down all these cover versions, cash in any generated copyright income and distribute that back to the respective rights holders.
Who owns these rights?
The answer is simple: the songwriter(s) of the song. Usually the rule is that whoever was in the room when the song was written gets a stake in the song. It’s always good to set up a splits sheet when writing with others. Make sure to register whatever copyrights you have with your local PRO (Performance Rights Organisation) or a PRO of your choosing. It is possible to sell your copyrights, partly or completely, to a publisher or a third party but the rules on this differ per country. For example, in the Netherlands you can only sign away 33,33% of your copyrights, but in the United States you can sell your copyrights for 100% to a third party. Make sure you check whatever the local rulings are where the third party you are negotiating with is situated.
So here is where it gets a little complicated. A recording will almost always include a copyright. But if you would record a public domain song, such as ‘Happy Birthday’, for example, there would be no copyrights involved. If you record a cover song you would be the owner of the master tape but not of the copyright, since you didn’t write the song. Opposed to this is the fact that a lot of songwriters own their copyrights, but when a big artist decides to cut (record and release) your composition they do not own any master rights. This is why publishers and songwriters have been fighting for a fairer division of streaming income (check out this Merck Mercuriadis article). If the slice of the pie is so little for songwriters there’s less incentive to write, but without the song there wouldn’t be a master recording of course. A complicated matter, although the industry consensus seems to be that songwriters deserve a bigger slice of the pie.
This is also why big and small artists can cover any song they want, but you can’t just re-release an old Nirvana bootleg you downloaded on Limewire years ago. You are of course to post your own cover of that song anywhere you like. And this is also the reason why you can sign to a label and a publisher independently. Sure, some labels and publishers have label or publishing services, but be wary of this. It’s sometimes not a good idea to sign away both master and copyrights under the same roof. Always seek out legal and business advice if you are unsure.
Hopefully now you’re able to differentiate between the master rights you own and the copyrights you own. It might seem slightly arbitrary but it also gives you an insight in the different revenue streams you can tap into. Signing a song with a publisher might get your song cut by a bigger artist or cut for a sync into a big commercial, but signing with a label might make the actual recording successful. At the same time I hope it also makes you conscious of the value you own as an artist or songwriter, and to be careful not to sign away too much at once. Remember, signing away your rights is as easy as it is hard to get them back. If you have any questions, comments or remarks don’t hesitate to reach out, e-mail or DM me and we can have a chat at email@example.com or Instagram.