Copyright

The Copyright Act protects both the music and lyrics of musical compositions, as well as sound recordings of those compositions.  These are two different copyrights that can be owned by the same or different rights holders.  Like other types of copyrightable works, musical compositions and sound recordings are protected by copyright from the time they are created without the creator having to register the copyright.

Under section 106 of the Copyright Act, the owners of copyrights have the exclusive rights:

(1) to reproduce the copyrighted work in copies or phonorecords;

(2) to prepare derivative works based upon the copyrighted work;

(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;

(4) . . .  to perform the copyrighted work publicly;

(5) . . . to display the copyrighted work publicly; and

(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.

There is a further right given to performers by section 1101 of the Copyright Act, which prohibits the fixation, transmission or distribution of sound and video recordings of musical performances without the permission of the performers.

There are two copyright symbols used in connection with sound recordings. The familiar letter "C" in a circle, ©, is used to designate musical compositions or other underlying works separately from the sound recording. When Congress extended copyright protection to sound recordings in 1972, they established a special symbol to designate the copyright in the phonorecording, or series of sounds fixed in the sound recording: the letter "P" in a circle: ℗.

"Phonorecord" is defined in the Copyright Act as "material objects in which sounds, other than those accompanying a motion picture or other audiovisual work, are fixed by any method now known or later developed, and from which the sounds can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device. The term 'phonorecords' includes the material object in which the sounds are first fixed."

A singer-songwriter who makes their own recordings of their own songs will own the copyrights in both the composition and the sound recording. But in the recording industry, ownership of the two is almost always divided: a songwriter will have a copyright in the words and music he writes while the copyright in the sound recording will usually be held by the record company the performer is signed to. The musical composition itself might have multiple owners because multiple writers worked together in writing it or a songwriter sampled an earlier song and its composer must be given credit.

An example of a musical composition and its sound recording owned by different rights holders is the song "Hey Jude", written by the team of Paul McCartney and John Lennon and then recorded by The Beatles. There are two copyrights, one in the song itself and another in the particular recording of "Hey Jude" as done by The Beatles. The composition "Hey Jude" is now owned by Northern Songs, originally begun by The Beatles but today part of Sony/ATV Music Publishing, while The Beatles' recording of "Hey Jude" is owned by Apple Records, the record company started by the group. The recordings of "Hey Jude" sung by other performers such as Bing Crosby, Elvis Presley, Tom Jones, and John Denver, would be owned by the record companies each of those singers recorded for.

Music publishing originally was just that: issuing sheet music of compositions, an example of the reproduction right given in section 106(1) of the Copyright Act. While there is still revenue today from printed music, most of the money in music publishing now is income from uses such as public performances of songs, licensing for use as ring-tones, and synchronization licenses for use in films and television shows.  The full range of rights given to composers and lyricists in section 106 of the Copyright Act flows from the publication right of that section. Because of music publishers' central role in collecting revenues, songwriters must be careful when entering into agreements with music publishers, as significant sums can be at stake.

The music publisher controls the rights to a musical composition and exploits those rights.  Music publishers are typically the clearinghouse for the rights protected by section 106, as publishers, on behalf of songwriters, issue licenses and collect royalties for the reproduction, recording, distribution and performance of musical compositions. Royalties are generated by the various kinds of licenses explained below.

There are two halves to royalties, the music publisher's half and the songwriter's half. Songwriters in the past often sold their copyrights to music publishers for a one-time payment, giving up their share of royalties completely. All future revenue would belong solely to the publisher. Songwriters would sometimes enter into an agreement with a publisher that would enable the writer to continue to get the writer's share of royalties—typically 50% of the total. Today, composers are increasingly likely to establish their own music publishing company and self-publish their music or possibly enter into an arrangement to co-publish their music with one of the large music publishers, thus giving the songwriter not only her share but part of the publisher's share as well.

Many music publishers are enormous companies with tens of thousands of songs in their catalogs. Warner-Chappell Music owns Katy Perry's songs. Sony/ATV owns the songs of Michael Jackson, the Beatles, Willie Nelson, and Beyoncé. Universal Music's songwriters include Henry Mancini and Shania Twain.

The largest publishers will have offices or affiliates in most foreign territories to exploit their songs abroad. Smaller American publishers will enter into sub-publishing agreements with foreign music publishing companies to promote the American publisher's songs and collect royalties in the foreign territory. 

A mechanical license is required to record a musical composition in a phonorecording. Mechanical licenses apply to actual reproduction of the composition in a physical form. If a performer wants to record a song that she does not control (i.e., does not own the copyright herself), a mechanical license is required to make a recording of that song. The recording of a song on a CD, a cassette tape, a vinyl record, a permanent digital download, or as a cellphone ringtone all require mechanical licenses. The best known provider of mechanical licenses is the Harry Fox Agency, owned by SESAC.  The Songwriter’s Guild of America and the American Mechanical Rights Agency also issue mechanical licenses. 

Section 115 of the Copyright Act provides for a compulsory license for non-dramatic musical compositions. If a song has already been recorded and distributed in the United States, then anyone has the right to obtain a compulsory mechanical license under the law. In other words, the owner of the copyright in a musical composition cannot prevent the recording of a cover of it if an authorized recording has already been produced and distributed.

Under compulsory licensing, a copyright owner is owed a fee for each copy of the recording made. That fee is determined by the Copyright Royalty Board based on a formula in the law. Since 2009, the compulsory license fee is the larger of 9.1 cents per copy made or 1.75 cents per minute of playing time or fraction of a minute. The owner of a song that is three minutes long would be owed 9.1 cents for each physical recording produced and distributed. The owner of a symphonic work that is 45 minutes long would be owed 78.75 cents for each copy of the recording that was made.  Current mechanical royalty rates are available here.

Record companies often negotiate for lower fees than the statutory rate. They can agree to terms such as 75% of the statutory rate or agree for royalties to be paid only on the number of copies sold rather than all those manufactured.

Owners of the copyright in a musical composition have the right to control public performances under section 106(4) of the Copyright Act. This applies to public performances of music both by live performers and by means of recordings. A restaurant, bar or club that has musicians playing on stage needs a license just as much as one playing recordings. Broadcasters also need licenses to use music on radio or television programs. Performances of dramatic musical works, such as an opera or a musical, require a "grand rights" license, discussed below.

There are hundreds of thousands of songs controlled by hundreds of music publishers that need to be licensed by thousands of venues, radio stations, and other users. The transaction costs would be enormous if publishers and users needed to negotiate performance licenses directly. Three performance rights organizations (PROs) accordingly act as middlemen between the music publishers and users.

The oldest is the American Society of Composers, Authors, and Publishers (ASCAP), founded by the composer Victor Herbert in 1914 to take advantage of the public performance right given by Congress to songwriters in 1897 and enlarged by the Copyright Act of 1909. It is a non-profit organization owned by its members and based in New York City. Broadcast Music, Inc. (BMI) was founded in 1939 by the National Association of Broadcasters because of a dispute over royalties between ASCAP and radio stations. It is owned by American radio and television broadcasters and based in New York City. ASCAP and BMI between them control over 95% of all compositions. The smallest organization is SESAC, founded in 1930. Its name originally stood for the Society of European Stage Authors and Composers. It is privately owned and based in Nashville, Tennessee. Unlike ASCAP and BMI, which any composer can join, SESAC is an invitation-only organization. The three have search functions on their websites that allow users to determine which organization represents a song. ASCAP's is here, BMI's is here, and SESAC's is here. Sherry Bond's Songwriter's and Musician's Guide to Nashville has a good chapter comparing the three PRO's.

A musical composition can only be registered with one performance rights organization, so many music publishers have subsidiary companies that contract with each of the performing rights organizations so their composers can chose which organization to work with. 

The American performance rights organizations have relationships with their counterparts in foreign countries to collect money from public performances in those countries.  All foreign territories with significant music markets have national performance rights organizations, such as the Society of Composers, Authors and Music Publishers of Canada, the Filipino Society of Composers, Authors and Publishers for the Philippines, and the Japanese Society for Rights of Authors, Composers and Publishers. These foreign organizations collect money in their home territories for American and other national PROs. The foreign organizations deduct a percentage for their collection costs, then send the balance to their American counterparts, who then distribute the revenue to their members.

The performance rights organizations issue licenses that typically cover the entire repertory of songs the organization represents, which is called a "blanket" license. Certain small businesses are required to have blanket performance licenses, while others are exempt. Businesses that use services such as Muzak to provide background music pay for the licenses with their service contracts.  Broadcasting music requires a performance license.

There is a fourth performance rights organization that represents owners of sound recordings, SoundExchange. Before the Digital Performance Right in Sound Recordings Act of 1995, there were no performance royalties paid to the owners of sound recordings. The law amended section 106 of the Copyright Act so that public performances of sound recordings by means of digital audio transmission now require royalty payments to the owners of those recordings. SoundExchange collects such payments and distributes the revenue to both sound recording owners and performers.

Digital broadcasters, such as satellite radio and internet services, now pay royalties to both the songwriters and the owners of the sound recordings. For example, when Sirius Satellite Radio plays The Beatles' recording of "Hey Jude," the owners of the copyrights in the musical composition and the sound recording both receive royalty payments, but terrestrial radio stations still do not pay royalties to the owners of sound recordings for broadcasting music. An FM radio station playing "Hey Jude" would trigger a payment to Sony/ATV, the music publishers for the musical composition, but Apple Records, which owns the copyright in the sound recording, would receive no payment. If the FM radio station streamed its programming over the internet, then it would be obligated to compensate the owners of both the composition and the sound recording for the station's use of the recording in its streaming.

"Grand rights" licenses are required to stage dramatic works with musical compositions, such as musicals, operas, and ballets. Grand rights licenses are often negotiated directly with the copyright owners of the musical compositions. For example, the Leonard Bernstein Office, Inc., controls theatrical and orchestral grand rights licensing for Benrstein's dramatic works, while the Martha Graham Dance Company licenses performances of the choreographer's works. Those wishing to stage a production of the musical Oklahoma! would need to obtain a license from the Rodgers and Hammerstein Organization, which owns the rights to the show and the music used in it. Many rights holders of classic and recent musicals have authorized Musical Theatre International, Inc. (MTI) to license secondary stage performance rights.

A synchronization license is needed to use a musical composition in any audiovisual work, such as a film, a documentary, a television program, or a videogame. These licenses are typically negotatied directly with the copyright owners of musical compositions. Licenses must be obtained from both the owner of the composition and the owner of the particular master recording that is desired to be used. Sometimes, if the owner of a sound recording wants too high a fee for a master use license, the filmmaker might secure a license for the musical composition and then arrange for someone to rerecord the song. Licensing the composition and then paying for a new recording can sometimes be cheaper than licensing a well-known recording of a song.

Some works are free to use without payment or permission. One category is works in the public domain. Everything first published in the United States before 1923 is automatically in the public domain. (Though a more recent arrangement of an older composition might itself be in copyright.) So a composer wanting to use themes from Mozart's "Eine kleine Nachtmusik" would be free to do so. One source for public domain music is here.

The second area where composers are free to use others' work is where the composer has assigned a Creative Commons license to it. Such a license allows others to remix, sample, or otherwise make use of the work. One collection of music licensed under Creative Commons can be found here.

Fair use is a third possibility. Section 107 of the Copyright Act gives users rights to the fair use of copyrighted works. General information on fair use, including the four factors for fair use that appear in section 107, can be found in this guide. The Supreme Court has held that a user does not need to ask permission for a fair use: "If the use is otherwise fair, no permission need be sought or granted. Thus, being denied permission to use a work does not weigh against a finding of fair use." Campbell v. Acuff-Rose Music, 510 U.S. 569, 586, n.18 (1994).

Since the Campbell case, courts have considered the "transformative" nature of the use in analyzing fair use claims. This consideration of "transformative use" was advocated by Pierre N. Leval, a federal judge, in a widely-cited law review article. Courts consider whether the user takes protected work and presents it as part of a new work or in a new context that produces new insights, new aesthetics, or serves new purposes different from the original. If the use is transformative, judges will typically pass over any economic harm because by definition such a new use is not a "mere substitute" or unfair competitor with the original. Other cases have held that de minimus use of copyrighted works is not infringement.

If none of these apply, then seek permission for your use. This guide provides general information on obtaining permissions. The first step is identifying the owner of the copyright, which might be on the work itself. If not, then several online databases can help.  Among these are the Copyright Office's registration records, the SongFile service of the Harry Fox Agency, ASCAP's Songview database search, BMI's repertoire search, or SESAC's repertory search. After the owner is identified, a request should be made in writing specifying exactly what is proposed to be used and for what purpose. If the owner proposes acceptable terms, then the user secures a license by signing the proposed licensing agreement and paying the requested licensing fee. 

These books specifically focus on copyright in music and musical licensing.  Books that focus more on the overall business of music but also contain information about copyright and licensing are in the box below.