• Randy McGravey

Upfront Money and Sync Fee Buyouts (Music Licensing Deals)

Today we are talking about receiving upfront money for music licensing deals. The majority of libraries won't offer upfront money, but some do, and there are basically 3 different deals that I've come across. Here are the 3 types of deals (these are all for exclusive libraries/clients only).

 

Sync Fee Buyout

A sync fee buyout deal is when a library offers money upfront per track, in lieu of paying sync fees to the artist. This means you will receive money up front (usually $$$-$$$$) and the library will keep all income generated from sync fees and blanket licenses. You should still maintain the full writer's share of backend royalties in this type of deal. If your music is specifically written for trailers or commercials this is probably NOT the best deal you can make, since those uses command high sync fees. If you do background instrumental music, then use your best judgement as to whether or not the deal is right for you.


Upfront Money (No Strings Attached, or Partial Sync Fee buyout)

I'm not sure what to call this deal, but basically you get money upfront just for giving a library the exclusive rights to license your music (most likely in perpetuity). This is the best deal, since you get upfront money AND a share of the sync fees/blanket licenses. The sync and blanket fees will probably be between 20% and 50% for the artist. If you can negotiate 50% then that is great! Plenty of libraries take your music exclusively in perpetuity for free, so if you find one that pays something up front then don't lose their number! Once again use your best judgement when entering these deals.


Work for Hire

A work for hire deal is very simple: you get paid a flat fee for writing music and the other party owns ALL of the rights. This type of deal is more common with jingles and for companies that hire a composer to write specific music for their product, program, etc. In a work for hire agreement, you can ask for a LOT of money up front since you will never get backend royalties. Usually these are high-budget clients too. There are some music libraries that deal with work for hire agreements, but it is very rare. Keep all of these factors in mind when negotiating a price.

 

Most of these deals are about negotiation. Always know your worth and make sure you know what you are signing. It is nice to receive money upfront in a business where it takes seemingly forever to get paid. Just remember that the more money you get in the long term, the better!


Learn a LOT more about the music licensing business with my new book:

"Making Money with Music Licensing"

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