7.0 Retention Period

Under a typical publishing contract the publisher will acquire the copyright in the songs in question. Sometimes, the writer may retain the copyright and instead grant the publisher an exclusive licence. This effectively places the publisher in no worse a position because an exclusive licensee of copyright has the same rights as the copyright owner. As a rule, however, the publisher will wish to own the copyright and be able to register the copyright in the publisher’s own name.

Traditionally, the publisher insisted upon owning the copyright outright i.e. for the full period of copyright (currently the life of the writer plus a further seventy years thereafter). Some publishers still insist upon owning songs for the full period of copyright but this is generally restricted to those cases where a publisher commissions a writer to compose music for a specific purpose (i.e. for a film or television programme). In the case of a singer songwriter signing a typical publishing contract he would expect to assign the copyright in his songs to the publisher only for a limited period i.e. the term of the agreement (which as we have seen will generally be three or four years but may be extended if necessary until fulfilment of the minimum commitment) and then for a further period.

This tends to be one of the more controversial areas in any negotiation. In the past, competition for writing talent has been fierce and publishers have been persuaded to accept limited “retention periods” i.e. perhaps the term plus five years (even less in extreme cases). A retention period of the term plus seven to ten years was quite common. As the music industry has “matured” there has been a great deal of activity in the sale of various music catalogues. Many of those catalogues have been sold for very high prices. A key reason for this is that the catalogues contain successful songs or “standards” which are owned by the publisher concerned for the life of copyright and from which it is clear that income will continue to accrue for many years to come. As a result, the trend in relation to retention periods has reversed and publishers, having re-learned the lesson of the value of copyright, now fight hard for longer retention periods. The publishers have lost too much ground to be able to claw their way back to the full period of copyright but a typical new deal now will provide for a retention period of the term plus a further period of perhaps between ten and fifteen years. Sometimes, in return for the writer agreeing to a longer retention period, the publisher may be persuaded to improve the royalties (perhaps from 75/25 to 85/15) in relation to income received after the expiration of a given number of years. The publisher might even be persuaded to pay a further advance at some point. For example, perhaps the writer will agree to a retention period of the term plus fifteen years provided that at the end of seven years after the term the publisher pays a further advance equal to perhaps three or four times the average annual royalty earnings over the preceding three years (this is not a standard formula by any means but it is one example of the many compromises which may be reached during the negotiations in relation to the retention period).