Page Kelley is a partner in the law firm Baker & Kelley.
Photo: Courtesy Page Kelley
When you sign a publishing deal, you typically agree to give half of your songwriting royalties (not to mention 100 percent of the copyrights to your songs) to the publisher. So why not promote your songs yourself and keep all that money?
The reason is reach. An established publisher has the connections and clout that can make the difference between your songs getting recorded by major artists or used in a movie or on TV, or languishing on a shelf undiscovered. Having a publisher handle all the business, legal and administrative aspects of songwriting also frees you up to devote your time to the creative task of writing songs. Still, many songwriters balk at “giving away” their copyrights and a big chunk of their songwriting royalties to a publisher. For some songwriters, there may be another option available that strikes a happy medium: the co-publishing deal. This type of song-publishing agreement allows songwriters to earn a larger piece of the royalty pie and also retain greater control over the use of their songs.
To find out more about co-publishing deals, I talked with attorney Page Kelley of Baker & Kelly, a Nashville-based law firm that offers legal services to songwriters, artists, producers and independent record labels. The information Kelley provided applies to co-publishing deals in every genre of music and all music centers.
What is a co-publishing deal as opposed to a “full” publishing deal?
In a full publishing deal, your publisher owns 100 percent of the copyright in the song you've written. That 100 percent pertains to copyright ownership [only] and not the income stream. That's an important distinction to make. It doesn't mean that the publisher is keeping 100 percent of the income the songs earn and paying you a pittance. It generally means that 50 percent of that income goes to you. The writer's share is 50 percent of net income even though the writer doesn't own any portion of the song he's written. A co-publishing deal, on the other hand, is any deal in which the writer retains some ownership interest in the songs he's written. With a co-publishing deal, the writer also owns a piece of the “publishing” [income], so a portion of [what would otherwise be solely] the publisher's share of income is also retained by or paid to the writer.
What's the typical percentage of the publisher's share of income that the writer gets in a co-publishing deal?
I don't think there's a typical percentage. But oftentimes, when people talk about a co-publishing deal, they're talking about a “50/50” co-publishing deal. The publisher and the writer would evenly split ownership of the song(s). For example, if a dollar of income flows in, the writer would retain 75 cents of every dollar [100 percent of the songwriter's 50 cents share, plus 50 percent of the publisher's 50 cents share] and the publisher would retain 25 cents.
Are co-publishing deals common?
They're more likely to be offered to a writer who has some sort of track record with songs he's written in the past or has a successful catalog (of songs) that he himself owns. A “track record” may mean you've had a publishing deal in the past but don't own any portion of the songs you've written. Your publishing deal has been terminated and you're free to pursue something new. Because you've demonstrated that your songs have value, it's more likely the [new] publishing company would be willing to give you something more than they give a brand-new writer. It would likely be a co-publishing interest. Alternatively, you could go to a publisher that already owns some portion of the songs you've written and negotiate down the road something better for new songs. It's very unlikely that a new writer will be offered a co-publishing deal right off the bat, whether it's for a single song or for a group of songs. But even if it's not offered right away, when negotiating a three-year songwriter agreement with a publisher, it can be negotiated that perhaps a co-publishing interest kicks in during the second or third year. Or once you're fully recouped, when you have earned “x” amount of dollars, you get a co-publishing interest in songs you write after that point. It can be done on a song-by-song basis, where you get a co-publishing interest in a particular song once it has been exploited on an album on a major label.
Some unpublished songwriters will take on the expense of producing their own high-quality song demos and then approach a publisher with a co-publishing proposal. The leverage here is that publishers don't risk their own money producing demos — they're ready to pitch. Is that tactic often successful?
That may work with smaller publishers. But with larger, more established publishers, while a well-produced demo may bring your songs to their attention, the costs associated with the demos are going to be relatively small compared to the costs they're looking to incur to market and promote your songs. For example, here in Nashville, typical demo costs run somewhere between $500 and $1,000 per song. Depending on the publisher, their decision on whether to give you a co-publishing deal won't be based on whether you can come to the table with five demos done or not.
Assuming you have the requisite track record, is there any downside to getting a co-publishing deal instead of a full publishing deal?
It may be a disincentive to the publisher to [pitch your song] as opposed to another writer's song or to continue on with you as opposed to with someone else who they're paying less money to for basically the same services, if those services are equal.
I see. The publisher has a bunch of staff writers with full publishing deals that they're paying stipends to, which they would like to recoup. The publisher earns 50 percent of the net income from songs written by them. A song written by a writer with a co-publishing deal, on the other hand, might only earn that publisher half as much money in percentage terms. That's got to influence them.
To the extent that there's some question about how well your songs are doing and whether your contract is going to be renewed for an additional year, it may be easier for a publisher to say “no” if their share of any net income [from your songs] is smaller.
Is there anything you should have in the contract to protect your interests should you be let go in the future?
It's very important that you have co-administration rights kick in after your contract term ends. [These rights allow you to, among other things, license the songs.] Generally, while you're signed as a writer, your publisher is the person who licenses your songs. You're not going out separately and competing with your publisher to find licensing opportunities. But after you're no longer signed to them, if your publisher retains 100 percent of administration rights and you leave with only a co-publishing interest, you're relying on your former publisher to continue to exploit your songs. You won't have any control over whether your songs are exploited or not. You want to have the right to seek out licensing opportunities for that song — including movies, television shows or people to record that song — and to enter into those licenses. Co-administration rights are also a major benefit to you if you ever try to sell your song catalog.
Is there anything else you want to add?
When we're talking with writers about deals, obviously we're going to do everything we can to negotiate a co-publishing deal for them. But I really think what's far more important is to find a publisher who believes in you as a writer and in your songs. If so, you're going to be successful, they're going to be successful, and very soon down the road the co-publishing arrangement can work itself out. You may be able to strike a co-publishing deal with a small publisher, but if they don't have good songpluggers in place [see EM's interview with songplugger Sherrill Blackman in the June 2009 issue, available at emusician.com], if they're not good at marketing and promoting your songs, you may end up with a co-publishing interest in a song that is never exploited by anyone and never makes any money. You have to be sure the publisher has the ability to exploit your songs. If so, that's great. If they don't, you're better off not signing a deal at all.
Songwriter and publisher Michael Cooper recently had a song cut on Dave Russell's new project, produced by Jerry Cupit for Cupit Records.