Thursday, August 17, 2017
Dave Carlock - A Day In The Life
OWNING MASTERS VS. OWNING GRATITUDE
Unfunded artists focus on one, not the other
Originally Posted: 12-13-2013 4:23 PM
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What does "owning masters" even mean? When I first started out, I was talking with NY producer-manager Abby Rosenfeld about one of my collaborations and he asked me immediately who owned the masters. I had no idea what that meant. When he first explained it to me, it still didn't make sense. I thought it meant just the physical tapes, but the term also refers to seller's rights. The latter was lost on me at age 20.

Most artists don't get it either and often assume wrongly that owning the masters means owning their song. The first thing you need to know is, it doesn't. To try to break it down for people, I analogize a photographer's relationship with their photography as an explanation of master ownership.

A master (recording) is like a photograph. Producers create the masters and own the masters unless they are paid to transfer their ownership to another person or entity. This is not the same as being paid for a recording service or a record production service, just as paying for the cheap photographer sitting fee isn't the same as paying a substantial fee for the photographer to transfer their ownership and the negative to the subject.

Also keep in mind that when taking a picture, a photographer doesn't own the person or the items in the photo. They own the picture itself, plain and simple. Similarly, producers own the master recording of the song they created, not the song itself nor the artist.

So when does an artist own masters? When the producer is paid their full professional fee, and the producer signs over their ownership to the masters they created, then and only then does the artist own the masters. That is --IF-- there isn't an investor funding an unsigned artist's project. If there is, masters are typically transferred to the LLC or investor who financed the project.

With signed artists, after producers are paid properly, the masters are typically transferred to the label. So in very few cases do the artists actually own their masters, and if so, it's often temporary. Yet a lot of new artists think this is something they SHOULD own for some reason, usually lack of understanding of the process.

Should they? Usually no. There's a lot to think about before giving a real answer, but I'll say it isn't as important as you might think. Yet many artists are knock-down-drag-out-to-the-floor convinced they should own their masters, to the point of blowing deals that they probably should be taking from people who could help their career.

Could it be that they have a belief that they should own every recording they participate in, even if they haven't paid a professional rate for its creation? Well, I have equally amazing beliefs that I should be able to fly above traffic with my car and have Rock & Roll Pizza show up hot and fresh at my door in Michigan at no cost to me.

An unrealistic artist's big complaint is they "feel" they should own the masters, which isn't in line with the law. Owning the masters is not about "feelings", it's about finances. First order of finance is, if the artist wants to own them, there are no "bro-deals" with producers. Secondly, they need to determine if they truly have the ability to sell or license the masters directly, otherwise the extra money spent toward their ownership is a waste because the masters have a market value of zero when they aren't being marketed! I don't want to jump to conclusions though, maybe the artist isn't really arrogant, they could just be a hoarder.

But finances always seem to be skint with artists so that takes us back to last week's column on why they need labels. Labels take the ideas they scratched out with that few thousand you invested in a few instruments and a computer and then continue to fund the project to the end. And what do labels ask in return? Essentially this: exclusivity from the artist for a period of time, guaranteed ability to promote the work with the artist's name and likeness rights, the artists' cooperation in promotional activities (interviews, gratis promo shows when deemed important), and, you guessed it, the ownership of the masters and any other recordings that were made during the contract's term.

To me, this is very common sense and a reasonable trade off depending on the amount of money laid out, yet I've had some artists tell me that they think that a label willing to lend $250,000 or more shouldn't own the masters that the money pays for. Hmmm.

And by the way, the only money artists pay back is through income generated by the project's record sales. An artist doesn't have to pay back the money if the record doesn't sell, unlike traditional lending institutions, the label just keeps the masters. Artists can attempt a buy-back of the masters later, but again, if the masters didn't sell, didn't earn any income, and the artist has no promotion budget to get the project out there, why spend the money? Very, very few artists know how to sell and market music, they often only know how to create it. But major labels do and artists still really need major labels to solve that problem.

I ask artists who are stubborn about owning the masters I create for them one question: "who can you call right now to pay my full producer fee, so I can sign over my master ownership to you?" Deafening silence. That silence speaks volumes.

Instead of demanding ownership out of turn, artists need to respect the value of what producers bring to the table in creating masters. When an experienced producer works with an artist on a project, they're doing highly skilled creative work with instruments, recording tools, and the contacts they built over the length of their career. All of that is drawn upon to make the artist the best they can be in the recorded medium.

So again, artists need to find investors to underwrite their endeavors, but don't look to producers to invest in the project. If they don't have funds to pay the producers, a producer is going to wonder how they will get the REAL cost--the marketing and tour support money! Why would they sign on? Food for thought!

Checklist for recording and launching a record:
Get a business plan and figure out how the project will sell.
Get a real marketing budget to get the attention of your buyer segment.
Get a recording budget so you can hire professionals to create a product worth buying. Pay producers their full fee if you want to own your masters.
Be ready to put an agreement in writing.

Artists! It's time to get real and...

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Dave Carlock
DAVE CARLOCK -
A DAY IN THE LIFE
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