Need or want to use music for your app or game? The landscape to license downloads, streaming, radio, video, and games is complicated at best. This session, presented on May 12 during the Music Startup Academy held at Music Biz 2015 in Nashville, took attendees through various rights for recorded music and underlying composition, as well as where and how to obtain licenses. 7digital's Kyle Pierce moderated the session and was joined by Raoul Chatterjee, 7digital; Bryan Friedman, Rithm; and Stephen Relph, TheOverflow.
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Music Startup Academy - The Licensing Vortex Explained: How To Get Your Startup Service Rightsholder-Approved
1. The Licensing Vortex: How to get your
start-up rightsholder approved
Music Biz May 2015
Kyle Pierce VP, Music Partnerships, 7digital
Raoul Chatterjee, SVP Music, 7digital
Stephen Relph, CEO, The Overflow
Bryan Friedman, COO, Rithm
2. Initial Phases of Thought
• Creating a compelling product offering
• Understanding which rights are
implicated
• What value does the offering bring to
the rightsholders
• How to craft a message that makes
sense
4. Understanding Which Rights are Implicated
Permanent
Downloads
DMCA Compliant
Radio Streaming
Interactive Streaming
Label Publisher PROs
US Licensing Grid
Master Mechanical Performanc
e
Compulsor
y
Sound-
Exchange
✓
✓ ✓ ✓
✓ ✓
License Type Direct Direct Blanket Blanket
Licensed by
labels
5. Understanding Which Rights are Implicated
Multiple Licenses per Recording
Jay-Z - Empire State of Mind
Label
UMG
Jay-Z Alicia Keys
Music
Publishers
Sony
ATV/EMI
April
Sony
ATV/EMI
Foray
Downtow
n Music
Pub
UMPGWarner
Chappell
Shawn
Carter
Alexander
Shuckburgh
Angela
Hunte
Janet
Sewell
Sylvia
Robinson
Bert
Keyes
PROs
ASCAP
BMI SESAC
Sylvia
Robinson
Alexander
Shuckburgh Janet
Sewel
l
Alicia
Augello
-Cook
Bert
Keyes
Shawn
Carter
Angela
Hunte
Alicia
Augello
-Cook
Information courtesy of HFA
6. Understanding Which Rights are Implicated
Multiple Licenses per Recording
Label
UMG
Jay-Z Alicia Keys
Music
Publishers
Sony
ATV/EMI
April
Sony
ATV/EMI
Foray
Downtow
n Music
Pub
UMPGWarner
Chappell
Shawn
Carter
Alexander
Shuckburgh
Angela
Hunte
Janet
Sewell
Sylvia
Robinson
Bert
Keyes
PROs
ASCAP
BMI SESAC
Alexander
Shuckburgh Janet
Sewel
l
Alicia
Augello
-Cook
Bert
Keyes
Shawn
Carter
Angela
Hunte
Alicia
Augello
-Cook
Sylvia
Robinson
Information courtesy of HFA
Jay-Z - Empire State of Mind
7. 9 Separate Licenses for 1 song
Multiple Licenses per Recording
Label
UMG
Jay-Z Alicia Keys
Music
Publishers
Sony
ATV/EMI
April
Sony
ATV/EMI
Foray
Downtow
n Music
Pub
UMPGWarner
Chappell
Shawn
Carter
Alexander
Shuckburgh
Angela
Hunte
Janet
Sewell
Sylvia
Robinson
Bert
Keyes
PROs
ASCAP
BMI SESAC
Alexander
Shuckburgh Janet
Sewel
l
Alicia
Augello
-Cook
Bert
Keyes
Shawn
Carter
Angela
Hunte
Alicia
Augello
-Cook
Sylvia
Robinson
Information courtesy of HFA
Jay-Z - Empire State of Mind
8. Licensing Challenges
• Rights can affect your functionality
• Existing business models can be
streamlined
• New business models come with
added complexity
• Border restrictions for services
9. Providing Value
• Services that grow their business $$$
• Services that help them build audiences for
their artists
• Partners that help promote their priority
projects
• Partners to test new technology
• Tools to build their capabilities
• Long term partners who understand their
needs
11. Crafting Your Message
Planning and organization
– Formulate a clear strategy
– Service description
– Resource
Presentation and messaging
– Commercials
– Marketing and differentiation
– Organizational alignment
– Projections
– Timing – not less than 3
months
12. Delivering Your Message
The response and counter-
proposal
– Facts
– Intelligence & market dynamics
– Fair collaboration
– Delivery
The contractual negotiation
– Term sheets
– Identifying key issues
– Work allocation
– Meet in person
– Make careful notes
Common issues
– Advances and minimum
13. Outline
1) What is TheOverflow ?
2) WIIFM
3) Partnerships
4) A Framework
14. What is TheOverflow?
• World’s First Limited
Catalog On-Demand
Subscription music
service
• Superserves the
Christian & Gospel
music fan
I’m responsible for 7digital’s global licensing and have worked on a wide selection of deals covering downloads, on-demand subscriptions, lockers, interactive radio, bundles and micro subscriptions across the range of majors labels, aggregators and indies. Its an all consuming effort that I find interesting and rewarding but highly challenging.
Planning & Organisation
Formulate clear strategy – what are the desired outcomes and how to achieve them?
Service description – updated and accurate
Resource – allocate team
Presentation and messaging
Commercials – how service will make money
Marketing and differentiation – how is the service different
Organisational alignment – right people presenting right message to right people
Projections - Disclose business plan and projections at the right time
Timing – not less than 3 months
The response and counter-proposal
Facts – research and factual analysis beats positional behaviour and emotion
Intelligence – understanding market dynamics and competition
Fair collaboration – speaking to competitors is not de facto illegal
Delivery – Enforce earlier statements, business like delivery, no emotion
The contractual negotiation
Term sheets – are your friend
Identifying key issues – warranties are less important than timely invoicing
Work allocation – insist on an agreed format for document exchange
Meet in person – people are less angry
Make careful notes – track progress
Common Issues
Advances & MGs