The Power Of Non-Exclusive Licenses In Music
Imagine you want to buy a new car. What’s the first thing you think about? It’s probably the price isn’t it? You want the nicest car you can find for the best price available. And it makes sense - as humans we want to feel like we got a good deal when we spend our hard earned money.
So what does that have to do with getting your songs produced? Before we answer that question let’s define some initial terms.
The first term we need to define is “derivative work” which means any song created with an instrumental or beat. This is a vocal recording mixed with an instrumental to create a new work with its own copyright.
The next term to get familiar with is non-exclusive license. This is a type of license that grants certain rights to the licensee (person who purchases the license) and comes with specified conditions. Non-exclusive licenses can define terms for various aspects of a derivative work including ownership and usage.
Finally, the term “work for hire” is important to define. For the purposes of this article, “work for hire” means a transactional relationship in which a producer is hired to complete 1 job for a set fee. The producer agrees to complete the job for only the amount defined in the terms and gives up all additional rights to the derivative work.
Exclusive licenses are what most people understand as a typical “work for hire” license where the licensee (person purchasing the exclusive license) now controls the entire derivative work and can exploit it unrestricted.
This is a common practice for how lots of songs get created - an artist hires a producer as “work for hire” to produce their song. The producer accepts a 1 time fee and the artist goes on their way with the exclusive license to the derivative work (their song).
So what’s the problem with this?
Well… nothing really, but there is another option. And when it comes to spending money on a service, you always want to know your options. Let’s dive into how the non-exclusive license can benefit artists.
How Leasing A Car Works
You or someone you know has probably leased a car before. When you do this, you’re agreeing to a set of conditions put forth by the dealership in order to use the car. Typically payments are lower, but there are restrictions around mileage and wear and tear.
Compared to buying, leasing is less common, but there are many people who prefer it due to their specific needs. Let’s breakdown the benefits of leasing compared to buying and see how that applies to non-exclusive licenses in music.
Lower monthly payments - leasing a car means you are only paying to use the car during the agreed upon time period so you really are just paying for depreciation on the car
Having options - after your lease is up on a car, you can go out and get another car. This means every few years you’ll be able to have a new car and try a wider variety of cars opposed to buying one outright.
Less logistics - with leasing you won’t have to worry about resale or maintenance
How Non-Exclusive Licenses Work
Similar to leasing a car, when you buy a non-exclusive license for an instrumental, you are essentially “leasing” the instrumental to use for your song. If you’re an artist or songwriter and are used to hiring a producer in person or online, this way of getting production is probably foreign to you.
But there’s real power in non-exclusive licenses and when used the right way, can be a better option for some artists. Let’s break down the benefits of non-exclusive licenses.
Non-exclusive licenses are drastically lower cost than hiring a producer and paying a work for hire fee. This is because, like leasing a car, there are restrictions around the use of the instrumental. We’ll cover those in the next section. For now, let’s imagine an artist needs production for a 10 track album.
If that artist hires a producer or multiple producers to create the instrumentals for those 10 tracks, they are looking at an average cost of around $5,000 - $10,000. If that same artist purchases 10 instrumentals non-exclusively, they can get that same quality production for as little as $499 (sometimes even less).
These days independent artists can’t compete without marketing budgets, PR spend, a social media campaign, and Spotify playlist pitching, so stretching an already thin budget to accommodate expensive production just doesn't make sense. This is why purchasing non-exclusive licenses from a trusted partner appeals to so many independent artists - they can still create their songs without paying expensive producers or sacrificing quality.
Large selection of tracks
When non-exclusive tracks are curated in a way that’s easy to navigate, artists have the ability to hand select instrumental tracks from a huge catalog in a matter of minutes. Imagine having thousands of high quality instrumental tracks ready for you to write to or customize right there at your fingertips.
Instead of waiting around for weeks for a producer to come back to you with a demo (that you may or may not like) now you can hear finished, high quality instrumentals right away which means you can immediately hear and feel the song and know if it’s right for you.
Non-exclusive tracks are typically aggregated from multiple producers so artists will have much more choice in the sound and style of their instrumental backing tracks.
Non-exclusive licenses allow artists to select an instrumental, write a song to it, release that song, and then see how it performs before spending thousands of dollars on the production. For many independent artists, streaming over 100,000 times isn’t a guarantee so why waste money on production that you won’t make back?
Depending on the place where you buy your non-exclusive licenses, there may be additional services and features available for artists to take advantage of as well. At Sounds Sphere, we offer our members free mastering, 1:1 coaching calls, and access to our huge list of industry professionals in a wide range of specialties (playlisting, sync, distribution, etc…)
We believe that independent artists should have options and not be tied down to what music industry gatekeepers dictate about how they create and share their songs. Don’t have access to major label resources? No problem - with a trusted partner like Sounds Sphere, artists have tools they can leverage to do more on their own than ever before.
So What’s The Catch?
Like leasing a car, there are tradeoffs that artists should be aware of when licensing a track non-exclusively. If you find producers online offering beats or selling tracks, most likely they are doing so non-exclusively so be sure to understand the individual terms and what you are agreeing to if you purchase a track online.
Multiple artists can license the same track - this means exactly what it says - a non-exclusive license gives you the right to create a derivative song that becomes its own copyright. Other artists can do the same thing which means multiple songs can be created with the same instrumental or beat.
Just like leasing a car where two people can have the same model car, but not the same exact car, this does not pose any legal problems. It’s also true that many sites offer stems so artists can customize the track to their liking to make it truly unique from the next artist’s song.
Time restrictions - some sites and producers only let you license an instrumental for a specific number of years. This means after the time period is up, you’d have to take your song off of any distribution platforms or purchase another license. For what it’s worth, at Sounds Sphere, we do not have any time restrictions.
Splitting rights - most non-exclusive licenses require artists to split at least the writer’s publishing with the producer of the instrumental. This is considered a fair tradeoff since the instrumental inspired some or all of the lyric and melody ideas. Master rights may also be split with the producer.
Oftentimes, this is actually beneficial if the producer can exploit the song for syncs and other opportunities. Because the producer has skin in the game, they are more likely to promote and help work the song.
Other restrictions - many non-exclusive licenses are unfavorable to artists with ridiculous restrictions that sometimes prevent you from even releasing your song. Most reasonable producers though, will allow you to stream the derivative song up to a certain amount of time before a new license is required. Most of the time restrictions are in place regarding radio, video, and synchronization for film/tv/ads.
However, depending on the contract, the license could end up providing rights for what an artist’s song would have done even if the track was purchased exclusively. That is to say, if your typical release only streams 80,000 times, has 1 music video, and gets a sync for a tv show, the non-exclusive license at Sounds Sphere, for example, would allow you to do all of those things.
The music industry is changing quickly so having information is critical to success. Your resources as an independent artist are ever expanding and with options like non-exclusive licenses available to you, you are now more empowered than ever before to build your brand and get your music heard.
Keller Medlin is the founder of Sounds Sphere - an upscale boutique marketplace helping artists and songwriters create great songs faster and with less cost.