These days the recorded music business is producer-driven more so than ever before. Producers not only create the sound bed and make the singer or rapper sound great performing over it, but producers also discover and develop new talent. It is important as a record producer to understand that each situation is unique, and the relationship between the record producer and the artist varies greatly depending on the arrangement between the parties as well as the genre of music. Producers have traditionally been paid for their services as employees or as independent contractors and their contributions to the creation of the sound recording in the studio are generally contractually deemed to be a work-for-hire for the artist or record label under the copyright law. As such, the copyright in the sound recordings is owned by the artist or the record label.
Sometimes a producer may be paid a flat fee for his services in the studio, but more frequently the producer is paid a fee that is deemed an advance against future producer royalties based on sales of the recordings. However, the paradigm keeps changing and has evolved over the years. Recorded music is more producer-driven than ever before. Producers now sometimes not only help capture the sound in the studio and use the available technology to mold the sound to be as commercially acceptable as possible, but more and more producers these days are finding and discovering new talent and developing the artist’s sound and even, in some cases, collaborating as a co-writer of the artist's songs.
When dealing with recorded music there are two copyrights that may come into play under the copyright law: (1) one in the sound recording or the fixation of sound and (2) one in the underlying music and lyrics, the musical composition or song. Copyright vests in the creator as soon as the idea is “fixed in a tangible medium”, so as soon as the author writes it down or the creator records it the copyright is created. In general the creation of the sound recording in the studio is separate from the writing of the song. This is usually true in most cases (e.g., in the rock, country and folk genres) where the artist usually comes into the studio with the song already completed or taking shape and the producer will then just assist in creating a recording of the song. In other cases, however, the producer's involvement may cover both copyrights. For example, a producer may create the musical bed or track (often before any artist, singer or rapper is even involved) so he also becomes a songwriting collaborator with the artist who writes the lyric and performs the vocals in the recording studio. In such a situation, the producer and artist become joint owners not only in the copyright in the sound recording but also, by current custom in the industry, in the underlying musical composition. It is also true that in today's top pop music world many of the producers actually co-write the songs with the artists in the process of creating the hit record (and sometimes numerous other songwriters as well).
It is generally standard operating procedure when dealing with an artist, particularly one signed to a major record label, for a producer to be asked to sign a contract to transfer any claim of rights the producer might have in the sound recording copyright to the artist or label in exchange for an advance and a producer royalty. The amount of an advance, which is recoupable against the producer's royalties later, can range widely, and may or may not include the studio costs along with the producer's compensation depending on how the budget is structured. Producers generally earn royalties from the sale of the sound recording (and may also earn mechanical royalties and performance royalties under circumstances where the producer is also deemed a co-author of the music composition. Producer royalties are often referred to as "points" which simply means percentage points deducted out of the artist's percentage share of royalties. For example, a typical producer royalty in the physical era might have been "3 points" which would, essentially, be 3 percentage points out of the artist's 12-15% royalty rate under the artist's record contract (i.e., approximately 20-25% of what the artist earns, which is how many producer agreements delineate the producer royalty now in the digital streaming era). In addition, the producer should earn a pro rata share of royalty income from any use and exploitation of the sound recording just as the artist does, whether from synchronization licenses for film and TV use, from social media, and from streaming digital streaming services like YouTube and Spotify).
At the end of the day, if you believe in yourself and your talents, give yourself the benefit of the doubt, and invest in good legal representation - all the successful producers do. Your lawyer can "translate" the deal and explain its terms to you, and then help negotiate more favorable terms for you as appropriate. My advice: never sign anything - other than an autograph - without having your entertainment lawyer review it first.
Wallace Collins is an entertainment lawyer and intellectual property attorney based in New York with over 35 years’ experience in music, film, television and emerging technology, and he handles many current digital media matters including issues that arise with AI. He was a songwriter and recording artist for Epic Records before receiving his law degree from Fordham Law School. Tel: (212) 661-3656; Website: http://www.wallacecollins.com
