In January 2013, TuneCore, a giant of independent music distribution, made industry headlines when it’s founder/CEO Jeff Price was ousted by the company’s new group of investors. The reason? A $500.00 bed & breakfast charge on Price’s expense report that the new owners insist was fraudulent because the receipt was in Word format*.
Employees were shocked and angered. Assumptions were made that venture capital firm Opus Venture had planned this from the start. And Price publicly asked the obvious question: “If they’re capable of doing this to me, what are they doing for artists?”
*(The charge was legitimate according to a Techdirt Journalist who spoke to the bed & breakfast owner).
Despite the new owners’ desire to remove Price from company leadership, they are moving forward with his vision to offer performing rights organization (PRO) administration services to TuneCore artists.
TuneCore is calling this service “Music Publishing Administration”. For a $75.00 fee they will assume control of 50% of your performance royalties. The strategic assumption is that by leveraging their size, TuneCore will get money flowing OUT of ASCAP more effectively than you can, just as they got your music flowing IN to iTunes more easily than you would have wanted to do yourself.
The math behind performance royalties is complicated so I’ll explain. Any performance royalties collected by a songwriter’s respective PRO (ASCAP, BMI, SESAC) are viewed as a “two pie” scenario that totals up to 200%. One of those pies is the 100% “writers” share which is normally divided between the people that made a valid creative contribution to the song. Co-writers and band mates are an obvious example, but many cronies, studio owners, managers & girlfriends have also enjoyed portions of this pie. The second pie is the “publishers” share which goes to the businessmen and women who promote, exploit, market and often finance the music.
The language of business is a different language than that of music-making. The people who speak the language of business have their own culture and set of norms. And thus they have their own pie.
TuneCore’s new product only addresses the “business” pie. They take 10% off the top and remit the rest to the artist (unless TuneCore’s licensing team secured the project. In that case TuneCore takes 20%).
At this point I should raise my hand and say that MusicRevolution.com also has PRO publishing entities (Meeped Publishing/ASCAP and Bimean Publishing/BMI) that can act as publisher for MusicRevolution musicians who do not already have that set up. And for this we do NOT charge a $75.00 fee. I should also say we recently launched a sister company, NonProMusic.com, to exclusively serve clients who wish to only use music created by non-pro musicians (hint: it’s a lot less red tape)
Also, TuneCore only pursues TV licensing deals for tracks that are enrolled in their Publishing Administration service. If you don’t let them handle your publishing, their TV/film team won’t seek licenses on your behalf. In contrast, we pursue every kind of sync and background music license for our musicians regardless of whether or not we are listed as PRO publisher of a track. We believe that if a musician has taken the time to set up their own PRO publishing entity, they can keep that money. They’ve earned it.
Here are some highlights from TuneCore’s Terms and Conditions of which artists should be aware:
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“The ‘Administration Term’ of this agreement shall be for an initial period of one (1) year, commencing on the date the Set Up Fee is received and processed by Company. After the initial period, the Administration Term shall automatically renew and extend for additional one (1) year periods unless you give Company written notice of termination at least sixty (60) days prior to the end of the period then in effect.”
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“The rights granted under this Agreement shall be assigned by Company to one or more of its affiliated music publishing entities. These include TuneCore Digital Music (BMI), TuneCore Publishing (ASCAP), TuneCore Songs (SESAC) and other similar companies organized for affiliation with existing collection organizations and societies throughout the Territory.”
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“With the respect to any Song(s) that are not currently owned by or registered to a company previously established by you, you appoint Company as the designated publisher of such Song(s) during the Administration Term.”
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“Concurrently with your execution of this amendment, you will supply Company with copies of any existing licenses or other agreements concerning the Songs.”
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This last one should give musicians pause. I’m not saying that TuneCore isn’t offering a bad service here. 10% is not an outrageous commission. But I think TuneCore’s product is targeted towards music that is “fresh off the bus” and has no previous licenses in place. If you’ve got music that is already earning PRO income, signing up for the TuneCore’s new publishing administration product means they’ll start earning 10% of work they didn’t do. Whether or not that’s ok depends on how much money that particular track has earned for you so far…and whether or not you think TuneCore will be able to move that needle in the right direction.