PAID IN FULL is a new limited weekly series written by Atlanta entertainment lawyer John Seay to help educate local musicians about the music industry. In addition to explaining the terminology that is key to understanding the business, John will take readers step-by-step through the critical process of collecting royalty payments, among other topics.

We’ve all heard the old adage “it’s not what you know, it’s who you know.” While this is a fairly simple and reductive notion in a lot of cases, it does remain applicable when discussing songwriter revenue. Now that you’ve recorded your album and made it available for streaming online, you need understand how to collect all your payments and the various companies involved that make those payments possible. In our previous segment, we partially outlined the process of getting paid, as well as the various revenue sources available to songwriters. Today we’re going to push that conversation further, and talk about additional terms and organizations you should be familiar with if you want to maximize your potential for profits.

Part Three: Keeping the Right Company

Harry Fox Agency

Harry Fox Agency (HFA) calculates and pays out mechanical royalties to publishers. They also issue mechanical licenses (for instance, if you’d like to record a cover version of a musical composition on your next release). HFA represents some 48,000 publishers.

Can you sign up for HFA? Not unless you are a publisher and have songs released via a third-party label (i.e., self-releases don’t count). So how do you collect mechanical royalties if you aren’t affiliated with HFA? As discussed previously, your label will pay these to you directly. But for other mechanical royalties owed to you by services like Spotify, basically, you need to sign up with an administrative publishing company, which will then collect your mechanical royalties for you, often from HFA. Otherwise you will not receive them (this is the subject of the class action lawsuit recently filed by Camper Van Beethoven and Cracker frontman David Lowery against the streaming companies).

Publishing Companies and Administrative Publishing Companies

Generally, there are two different types of publishing deals: a co-publishing deal and a publishing administrative deal. In a co-publishing deal, you typically transfer 50% of the copyright in the musical compositions to the publisher, usually in exchange for an advance. They then collect all royalties and payments generated by those musical compositions and try to increase the overall size of the royalty pie by securing placements of your music in film and television. The publisher takes its share of the revenue and pays you the remainder after your advance has been recouped.

In a publishing administration (“admin”) deal, the admin company takes no ownership interest in your musical compositions, and therefore may pay little to no advance. Admin companies simply administer your rights for you so you don’t have to, in exchange for a smaller participation in the revenues that they collect. Although some admin companies get involved in trying to secure placements, many do not. As discussed in Part Two, you can even enter into a publishing admin relationship with companies like Tunecore, SongTrust, CD Baby, and Audiam, in addition to numerous other respected publishing admin companies. Remember that to collect mechanical royalties from interactive streaming sites, you may need to go through a publishing company or at least a publishing admin.

ABOUT THE AUTHOR
John Seay is the founder and principal of The Seay Firm, an entertainment and intellectual property law firm based in Atlanta at the Goat Farm Arts Center. As an artist himself, John has over a decade of experience as a musician, tour manager, and writer. In addition to his work at The Seay Firm, John is also Of Counsel in the entertainment and media practice group in the Nashville office of Loeb & Loeb, one of the largest and most comprehensive entertainment and media practice groups in the world. Before founding The Seay Firm, John worked for Turner Broadcasting. In 2016, John was recognized as a Georgia Super Lawyers Rising Star in Entertainment & Sports Law, a designation only awarded to 2.5% of attorneys in Georgia. John is on the Board of Directors of #weloveatl and serves as a volunteer attorney at Georgia Lawyers for the Arts. He is a graduate of the University of Georgia School of Law. John works exclusively with artists and arts-related businesses. You can read more about his practice via the links below.

More Info
Web: theseayfirm
Twitter: @TheSeayFirmLLC