The Business Management of Music Copyright, Publishing, and Trademarks
When starting a business in music, filing for copyrights, publishing, and trademarks should be at the top of your to-do list. No matter your role in the industry, you need to pay attention to intellectual property ownership and rights.
Defining and explaining the entire idea of copyright and publishing is a bit beyond the scope of this article. Here’s a great refresher for everything you need to know about royalties, copyright, and publishing.
That article mentions two important words that come up in business management time and again - “assets” and “ownership.”
These two elements are the cornerstones of entrepreneurship.
“Ownership” dictates who put in the original idea, creative effort, money, hard work, and other resources to start the business, and “assets” are the property that the owners, well, own. When you rent a house from your landlord, you know you don’t own the house. Your landlord bought the property, pays the costs to maintain it, and leases it to you. The property is his asset.
Your songs, merch, logos, vehicle, gear, creativity, and other business elements are your assets. Formally claiming these assets is an extremely important part of your business’s development and growth.
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Assets are important for several different reasons.
First, they help you create more work.
If you own a recording studio, your space and gear are your assets, and without them, you wouldn’t be able to do your job. A catchy song can get radio or TV airtime for years, and help you find new artists to write with. Good-looking merch can help you create a fashion division, and so on.
Second, licensing the rights or selling your assets can bring a steady flow of income. Maybe you rent your studio space to other engineers. Streaming is a form of licensing - you’re allowing temporary, contracted use of your property in exchange for payment. Allowing media companies access to your songs for sync with video is another form of licensing. The TV program is just borrowing the song. They don't own it. And every time it airs, you get paid.
It’s not all that different from the landlord who leases his rental house to you.
Third, their value often determines how much your business is “worth” in the eyes of banks, lenders, or investors. Some assets appreciate in value over time (like property, rare items) and some assets depreciate in value (cars, obsolete gear, a song that was supposed to be a hit but wasn’t).
Lastly, you can trade your assets for cash. You can liquidate gear to pay a debt, sell a property for more than you paid, or sell half of your songwriting credits to a publishing company.
The key to the business management of copyright, publishing, and trademarks is to 1) make sure everyone is on the same page, 2) use the right vocabulary words and 3) follow a specific sequence of registration steps. This ensures that ownership is properly allocated and that you’re checking all the to-do boxes for each different asset type.
Intellectual Property
Let’s start with the broad definition of what we’re creating: Intellectual Property.
Intellectual property is “a work or invention that is the result of creativity, such as a manuscript or a design, to which one has rights and for which one may apply for a patent, copyright, trademark, etc.”
As a musician, producer, songwriter, etc, you are in the business of creating new pieces of intellectual property. These songs - and the merch (CDs, vinyl, tshirts, stickers, etc) that goes with it - are your business property, the literal fruits of your labor, and they must be protected, formally and legitimately through the systems set up by the government.
Protecting your assets means you have a course of action if someone tries to steal them from you. It also shows the IRS that you are operating under the corporate veil and not just a hobbyist. It gives you proof of ownership, if you ever need it.
Plus, if you work with people but don’t claim ownership for the work you did, are you really working? Or is it just having fun with a hobby?
Copyright and publishing can get really confusing. If this is the first time you’re studying anything about it, check out the article I posted above, and this one as well. Everything you’re about to read will make more sense with a basic understanding of copyright.
Registering Your IP
Now that you understand the importance of assets and protecting your intellectual property (from now on I’m going to call this “IP”), let’s talk about how to do this and what the process is.
There are generally three types of IP protections you need to file as a musician, and they each protect a different element:
Copyright: protects your ability to have the exclusive right to reproduce, sell, distribute, publicly perform, display, and prepare derivative works of the copyrighted work for a certain period of time.
Publishing: protects where the IP is sold or otherwise distributed and in what forms it can be consumed.
Trademark: protects your ability to have the exclusive right to the words, phrases, logos, or design that distinguish your work from anyone else’s.
Since it’s so important, let’s explore the definition of copyright a bit more:
Copyright: protects your ability to have the exclusive right - only the people listed as owners can authorize copies.
to reproduce, sell, distribute, publicly perform, display, - use in any way
and prepare derivative works of - this includes parodies, samples, remixes, etc.
(although some things fall under fair use, you can still deny permission like these artists denied Weird Al)
the copyrighted work for a certain period of time - in the US, copyright lasts 70 years past the death of the author.
Understanding your rights as a copyright holder is important.
In our helpful Start-up Essentials Workbook, one of the checklist items is “Setting up a Copyright Process.”
This is an important task to handle right at the beginning of the business because it can be difficult to backtrack into. Sometimes people skip it, assuming that their work is copyrighted when they put it up on the internet. This is partially true - “publishing” a work DOES automatically assign the copyright to you BUT that is not enough to protect you in court in case of litigation. If someone steals your work and tries to pass it off as their own, and you did NOT file a formal copyright with the government, your rights will be very limited. Read more about that here.
If you will be creating original intellectual property, you need to file a copy of the song with the US copyright office, with all the owners pertinent information. This proves you own it and names the people who are authorized to give other people permission to use your work.
On the US Copyright website, you will follow these steps:
Create an account - use an email address you will have forever.
Indicate the Type of Work being registered - use Sound Recording if you have the actual audio recording. If it’s just sheet music, lyrics, or a written version of the song, use “Works of Performing Arts.” Read more about Types of Work here.
Indicate the titles. If registering an entire album, list every song, but ONLY if the ownership is consistent between all songs.
Indicate publication status - is it already online? If so, you must provide an ISN (or ISBN) link so the copyright matches up with what’s been published.
Provide author information - who wrote it? Include name (including pseudonyms or stage names), address, year of birth, organization, country of citizenship and domicile.
Name any additional claimants or representatives that have permission to authorize use of this copyright. This is where you might list your publishing company as an entity that has permission to say yes if someone asks to use your song.
Indicate any “limitations of claim,” which is especially important when sampling (you cannot claim original ownership of a song that’s already been written).
Choose a permanent address (be sure to update this if you move).
Additionally, here are a few other things to pay close attention to:
As a band, you need to talk about who gets the writing credit. Is it the whole band split evenly, or only the people who worked on the song? Decide early and write it down in a formal band agreement.
You need song split sheets and work-for-hire contracts on hand for when you write with other people. This is the paper trail that leads to a copyright application.
Each “work” on the copyright application must have the same owners. For example, if you are registering a 6-song EP as a “collective work” but you wrote three songs, your guitar player wrote two, and the whole band wrote the last one, you need 3 separate copyright applications that align with the 3 different ownership groups, or the whole band will have equal copyright protection for the entire EP. Read more about that here.
Are you using any samples or recording covers? You need to get permission, and credit them with ownership in your copyright application
You need to write down, preferably in a will or formal legal document, who will take ownership of your copyrights in the event of your death.
When you publish your songs, ownership percentages listed should match the names and addresses of the copyright owners.
Did you sign a work-for-hire contract? That means your contribution is owned by the person who hired you. Read more about that here.
Lastly, you might need to mail written or audio copies of the work to the US Copyright office. Some types of work can be submitted electronically. Read more about that here and here.
It’s my opinion that doing this painstakingly tedious work is one of the MOST important things you’ll do as a musician. If you only take away one thing from this article or any of my classes, know that your intellectual property are the assets upon which you’re building your business. Protect them, even if that means a few extra costs.
Publishing
In addition to copyrighting your work, you need to publish it. Publishing is the act of distributing a piece of intellectual property to the public, in a way that can be easily shared, sold, or purchased.
Publishing laws originated with regards to sheet music. A songwriter would write a song, chart it out, and turn it over to a publisher, who would make copies in mass reproduction and distribute them to bookstores, churches, music stores, or whoever wanted a copy. The songwriter likely got a cash advance as payment for use of the rights, and then an additional payment for every copy sold. This is called a royalty.
This process has changed a bit in the past 20 years with the proliferation of the internet and websites that allow musicians to self-publish.
Until recently, it was relatively difficult for musicians to self-publish. The entire process of printing vinyl records or CDs, distributing them to stores, and marketing to fans was so arduous that signing with a record label - which provided these services in exchange for royalty sharing - was the best way to go.
In the early 2000s, digital distributors like CD Baby appeared, offering musicians an affordable way to print - or publish - their own CDs. When iTunes came on the market, CD Baby formed a strong partnership with them, becoming one of the first distributors to assist independent musicians with distributing their music online.
This was a HUGE moment in music history.
Now, for the first time, independent musicians had access to the same distribution channels as artists signed to a major label.
For a fun history lesson or blast from the past check out this interview with Derek Sievers from 2003. (it ends with “Thanks Derek, and good luck with your new side project [CD Baby].” lol)
Self-publishing is a major win for independent songwriters. Previously, in order to get distribution, you had to sign with a label and a publisher, both of whom took ownership of your royalties in exchange for a cash advance, then gave you a percentage back.
A rather small percentage
So now that artists can self-publish, they keep all their royalties.
They don't get all the label and publisher services, but they get 100% of two different royalty streams. For a lot of people, that's incentive to stay indie.
BUT - it's all for naught if you aren't collecting all your royalties. You HAVE to publish your songs.
If your song is not formally published, you are unable to collect the songwriter portion of your royalty payment.
Publishing your song allows you to name the songwriters for the purposes of royalty collection, and if you sampled a song, those writers have to be included (this is why Queen and David Bowie are listed as songwriters on Ice Ice Baby).
Note that in the Ice Ice Baby notes, each member of Queen is listed individually as songwriters. This is because people write songs, not companies.
Songs are (generally) always registered to individuals (and their Social Security numbers) and not the band entity (or the EIN) that those individuals were working with when they wrote it. This also means that if the band breaks up - meaning the entity folds and the business operations cease to exist, but royalties continue to be earned and collected - they will be sent to the individuals who wrote the songs.
Notice that right under the individual names is a big list of publishing companies. These are the companies that manage the copyrights for that songwriter. You must have both listed to collect your royalties - an individual who wrote the song and a publishing company that distributes it.
Lastly, if the song is a hit, it’s important for the songwriter to create a living will or estate for these royalties to be collected after their death. Otherwise, posthumous royalty collection would go through probate court which is generally not going to be a pleasant experience for anyone. Read more about what happens to royalty payments after death here.
From a business management perspective, here are the things you need on your to-do list:
If self-publishing, be sure you have a business entity in place to administer the publishing.
Consider using a digital distributor to publish your work and collect royalties on your behalf.
When publishing the songs, double and triple check that the songwriters info is correct and that percentage splits match the written contract. This includes any members of the band, producers, samples, or lyrics pulled from fair use works.
Confirm that Social Security numbers and EINs are listed properly on publishing documents. The SSN refers to the human who wrote the song, and the EIN refers to the publishing company that administers the copyright.
If self-published, be sure you are registered with all the proper agencies for royalty collection. Many songwriters register with ASCAP or BMI and stop there but that’s NOT enough to collect all your royalties. Read more about that here.
Know the difference between the composition and the sound recording. Be sure that you’re registered with the right agencies to collect the songwriter royalties, the publishing royalties, AND the audio recording royalties.
Carefully consider whether or not you should sign with a publisher.
Let’s be honest - publishing is confusing. I've been doing this for 20 years and I still get tripped up sometimes. The laws were not originally written for audio or digitally transmitted files, so they are always changing and being adapted to meet current needs.
Don’t be discouraged if you don’t understand all of it.
Just follow the steps here to ensure your IP is protected and keep making good music. If you’re still confused, check out the DIY Musician blog from CD Baby website. As a business manager I rely heavily on the information they provide. If that doesn’t answer your questions, shoot me an email.
Do you need trademarks?
A trademark is a symbol, word, or words legally registered or established by use as representing a company or product. Trademarks are the reason you can’t name your band after someone who is already famous, or a corporate brand. If you try to use a name that is already trademarked, you can be asked to “cease and desist” using the name, which would confuse your fans and cause a huge headache when you have to change all your handles and website addresses. Even if you have permission to use the name, using a name that is too similar to an already trademarked name can cause confusion. Read about the band formerly known as Dale Earnhardt Jr Jr here.
A trademark protects your name and logo from being used by others without authorized permission. Trademark litigation happens often in regard to “bootleg” or unauthorized merch, like when The Doors issued a cease-and-desist to the Jenner family.
Trademarking your name as a musician is important, but comes with some limitations. Once you are established and known under your name, trademark it. Even if you’ve been using the name for 20 years, failing to trademark it could mean it gets stolen out from under you. Read about the Lady A/ Lady Antebellum trademark dispute here.
Check out this article for more about trademarking for artists and musicians
For many musicians, these are the types of tasks they are eager to “give away” when they sign with a manager or get a label deal. This is completely understandable. However, given the state of the music industry today, most managers will want to see a body of work released before they will consider signing you. That means, for the first few albums, you’re on your own. It’s essential that you understand not only what your rights are, but how to collect the money that falls behind it.
This is a very dense, loaded topic that is almost continuously changing. The Music Modernization Act changed many of the long-term elements of copyright and publishing law. To stay up to date on that, bookmark this article here.
Most of all, do not let this stuff stop you from making music. There are always people available to help with these issues.
In the next article, we will discuss partnerships and the different ways that you can organize your business to include - or exclude - band mates, managers, spouses, co-writers, and more.
And as always, we are here to help you set up your company. Our FREE Start-up Essentials Checklist and our low-cost Essentials Workbook can help you ensure you aren’t leaving any tasks undone (use coupon code CHECKLIST for $10 off, and thank you for reading this article).
If this was helpful to you please comment below or shoot me an email. Please share this with your friends or band mates and tag me in social media posts.
You’re awesome - protect your intellectual property.
-Steph
PS. I'm not a lawyer and nothing this article constitutes personalized legal advice. Consult an attorney for issues pertaining to copyright or trademark infringement.