6.0 Ownership

6.1 Copyright

Usually, the company owns copyright in the artist’s recordings for the full period of copyright, which lasts for fifty years from first release. This feature of recording agreements reflects the perhaps outdated view that an artist’s work is effectively available for outright purchase. This approach was traditionally taken in music publishing. A generation or two ago it was common for writers to grant copyright in all songs to the publisher for the full life of copyright, which in the case of any song is now for the life of the composer plus a further seventy years. This is now unusual, and in turn, there is now a trend on the part of record companies to accept that perhaps the issue of copyright ownership is open on occasion to negotiation.

6.2 You Pay; We Own

The record company’s insistence on copyright ownership is particularly difficult to justify when coupled with the practice of recouping all recording costs from the artist’s royalty. Provided sufficient records are sold, the company is repaid its recording costs by the artist by deduction from his or her royalties. The practice of insisting upon outright ownership of copyright is seen by some as an abuse of record company power.

6.3 Copyright Reversion

In the past, some successful artists eventually succeeded in obtaining reversions of copyright but this was rarely granted by way of concession. It would normally only reluctantly be conceded in a re-negotiation. In effect, the artist has always paid a price for the reversion of copyright, usually in the form of an agreement to record more material for the company. In the new world, some of the majors are now more ready to make concessions in this area, even (in exceptional cases) for new artists.

6.4 Restrictions

The artist may succeed in imposing restrictions on how the record company’s rights may be exercised. The company is more likely to grant concessions to the artist over artistic matters than marketing. We refer to artistic controls in paragraph 4.0 above (creative issues) and we deal with marketing controls below in paragraph 6.6.

6.5 Artwork

The artist will often require the right of approval over any artwork. Usually the record company will pay all artwork origination costs on a nonrecoupable basis. In the absence of any agreement to the contrary, the company (as between the company and the artist) will own the artwork. The artist may nevertheless have a right of approval. In other cases, the artist will insist on the right to originate artwork, in which case the artist may own the artwork (subject to the terms of the agreement with the creator of the artwork). Sometimes the company will pay the origination costs up to an agreed budget but nevertheless accept that the artist owns any available rights. The artist will then grant the company a licence to use it for the promotion and sale of his or her recordings. This leaves the artist free to exploit the artwork for other purposes (e.g. on T-shirts and other merchandise) without having to seek approval from the record company. Record companies may sometimes refuse to allow an artist to make use of its artwork for merchandising unless the artist pays all or part of the origination costs.

If an outside designer is commissioned or freelance photographer used, a clear assignment of copyright should be obtained. If this is not done, copyright in the artwork will remain with the creator. The artist and record company will have an implied licence to use the artwork for its intended purpose on the record’s packaging. Further consents may be required before the artwork may be used for merchandising or other purposes. 6.6 Marketing Restrictions

The record company may agree to seek the artist’s prior written consent to certain acts. For example, for the deletion of records from the company’s catalogue less than, say, two or three years after release; or release of records on a different label; or recoupling certain tracks with other recordings on compilation albums and the like; or use of recordings as premiums whereby the artist’s records are given away as an incentive to purchase another product (see Part III); or the grant of any synchronisation licence to use a recording in a TV ad or film; or, perhaps more importantly, before selling albums at less than full price before, say, one or two years after initial release. Whilst some restrictions are useful, the artist should be cautious of imposing unnecessary restrictions. In theory, the record company will know best how to market the recordings. Problems often arise after an artist leaves his or her record company. His new company’s carefully planned marketing campaign might be damaged by the previous record company’s rerelease of earlier material. Accordingly, the artist may seek to impose restrictions on the release or the frequency of release of greatest hits albums. However, these problems may be exaggerated. An artist’s previous record company’s activities are unlikely seriously to damage the new company’s efforts. Sometimes, any increased activity in respect of the artist’s earlier recordings will produce additional income for the artist at a time when he is likely to be “unrecouped” with his new company.