Updated: Dec 14, 2019
The AFM (American Federation of Musicians Union) Local 257 President Dave Pomeroy recently announced the finalization of negotiations on the Legacy Demo Agreement, which allows publishers to use their old catalog demos for monetization purposes in digital formats including interactive streaming, and as digital downloads.
Now “Producers” of 10 + year old demos can sell digital downloads and digital streams of old recordings, including demos of songs that were cut and made famous by artists.
This move goes along with the recent trend of music publishers to monetize not only their © composition copyrights but also the (p) sound recording copyright, which is a lot more lucrative in the digital streaming marketplace.
Some figures show that 96% of all royalties paid out by digital streaming companies (Pandora) goes to compensate the sound recording owner (artists and record labels), while only 4% goes to compensate songwriters and publishers for their copyright in the underlying composition. [Source cited below]
This is in contrast to the royalty pay out for terrestrial radio (FM & AM), which has 100% of royalty going to songwriters and publishers, and 0% going to labels and artists (the owners of the sound recording copyright). [Except BMLG who does receive sound recording copyright compensation from some terrestrial airplay.]
BMLG President Scott Borchetta speaking at CRS 2017
The upfront fees for the Legacy Demo Agreements are very reasonable with upfront costs only about $20 to $40 per player up to 10,000 units. This is plenty of leverage to test whether or not additional investment in the copyright is warranted.
Songpreneurs rejoice! Another opportunity to monetize those copyrights is born. Thanks Dave Pomeroy and all the other AFM leaders who are working with songwriters and others in the music business ecosystem.
Dave Pomeroy playing bass on recording session at Blackbird Studio produced by Amanda Colleen Williams in 2014
What does this mean for you?
If you have legacy demos with a publisher, or if you as a producer have rights to a demo recording, you can now release it and sell it as long as you abide by the conditions set forth in this new Special Agreement.
Here’s a link to that agreement “Special Agreement for the Limited Digital Distribution of Legacy Demonstration Recordings” so you can see it for yourself.
** If you're dealing with demos that feature now famous or under contract singers or performers, check with them and their label representation before releasing any master recordings to the public. It could not only raise legal issues, but it is just the right and respectful thing to do.
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"Business Matters: The Truth About Payments to Artists" by Glenn Peoples [who now works for Pandora], October 10, 2012 accessed April 20, 2017 BillboardBiz online http://www.billboard.com/biz/articles/news/1083455/business-matters-the-truth-about-pandoras-payments-to-artists
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