Music Business: The Importance of Copyrights and PROs

Hi everyone, Anthony Corder here, an instructor at Dark Horse Institute. I am looking forward to starting our new Music Business program on January 4th. I’ll be discussing and weighing in on the many conversations going on surrounding revenue and royalties in the music industry at the moment. In this post I’ll be discussing the basics of copyrights and how they work in conjunction with Performance Rights Organizations and how they can be a great first step in guiding you down that path to success in the music industry.

A Quick Note About Copyrights

From the instant you start creating copyrights, defined as the the moment you begin writing a song, you are creating assets (registering and protecting that copyright is a different discussion). Copyrights afford their owner/holder a bundle of exclusive rights. The rights are to reproduce the work, distribute copies of the work, perform the work publicly, make a derivative work, display the work publicly and public performance via digital transmission (sound recording). (you can read more about exclusive rights a copyright affords) In this article, we’ll be discussing an important source of revenue known as the “performance royalty”.

Now About Performance Rights Organizations

When your song is performed publicly, such as radio (terrestrial, satellite), internet, used on TV or commercials and even live, you are paid a royalty for that performance. The royalties for public performance are collected by Performing Rights Organizations (PROs). BMI, ASCAP and SESAC are PROs. These companies collect the royalties and distribute them to the songwriters and publishers. BMI and ASCAP each function as non-profit companies, are much larger and are open for registration. They have a more corporate feel and have many members. They are similar in duties but each brings different strengths and corporate cultures. SESAC operates as invitation only to join, it’s smaller and a for profit company. SESAC has a more laid back feel but is more selective in membership. (FYI, SESAC has recently made an acquisition that has increased its corporate size, we’ll discuss in the near future).

The music business is a relationship business; you are looking at long-term interaction and should select a company that you feel is the right fit for your needs. Something to think about…how do you see yourself fitting in their structure? The representatives that work in writer/publisher relations will be your champions. You need to find the one that believes in you/your company. They help you develop and have an objective focused on creating opportunities for you/your company to be successful. If you have not already affiliated with one of these PROs, I would encourage you to request a meeting with all three companies before making your choice. They’re easy to get in touch with to schedule an appointment with a rep who could point you in the right direction to take your music career to the next level. There’s only one way to find out…