[UPDATED] The music business, particularly the pop and urban markets, is more producer driven than ever before. Producers not only help capture the sound in the studio and use the available technology to mold it to be commercially acceptable, but more and more producers are finding and discovering new talent and developing the artist’s sound and even co-writing the songs with the artists.
It is important as a record producer to understand that each situation is unique, and the relationship between the record producer and the artist varies greatly depending on the arrangement between the parties as well as the genre of music. Producers have traditionally been paid for their services as employees or as independent contractors, and their contributions to the creation of the sound recording in the studio are generally deemed to be a work-for-hire under the copyright law. As such, the copyright in the sound recordings is owned by the artist or the record label. Many times a producer may be paid a flat fee for his services in the studio or paid a fee that is deemed an advance against future royalties based on sales of the recordings. However, the paradigm keeps changing and has evolved over the years. Recorded music is more producer-driven than ever before – particularly in the pop and urban genres. Producers now sometimes not only help capture the sound in the studio and use the available technology to mold the sound to be as commercially acceptable as possible, but more and more producers are finding and discovering new talent and developing the artist’s sound and even, in some cases, collaborating on the artist's sound as well as co-writing the songs.
When dealing with recorded music there are two copyrights that may come into play under the copyright law: one in the sound recording and one in the underlying musical composition or song. Copyright vests in the creator as soon as the idea is “fixed in a tangible medium”, so as soon as the author writes it down or the creator records it the copyright is created. In general the creation of the sound recording in the studio is separate from the writing of the song. This is usually true in most cases (e.g., in the rock, country and folk genres) where the artist usually comes into the studio with the song already completed and the producer will just assist in creating a recording of the song. In some cases, however, the producer's involvement may cover both copyrights. For example, in urban and hip-hop music the producer who creates the musical bed or track (often before any artist or rapper is even involved) also becomes a collaborator with the artist who writes the lyric and performs the vocals in the recording studio. In such a situation, the producer and artist become joint owners not only in the copyright in the sound recording but also, by current custom in the industry, in the underlying musical composition. It is also true that in today's top 40 pop music many of the producers actually co-write the songs with the artists in the process of creating the hit record.
It is generally standard operating procedure when dealing with an artist, particularly one signed to a major record label, for a producer to be asked to sign a contract to transfer any claim the producer might have in the sound recording copyright to the artist or the label in exchange for an advance and royalties. Producers generally earn revenues from advances and royalties paid for the sale of the sound recording (and may also earn mechanical royalties and performance monies under circumstances where the producer is also deemed a co-author of the musical composition). In addition, the producer should earn income from all use and exploitation of the record just as the artist does, whether from synchronization licenses for film and TV use, from social media, and from streaming services like YouTube and Spotify. In the absence of paperwork concerning the producer’s work in the studio and the producer’s share of income, then the producer and artist may be deemed to be joint owners of the sound recording copyright and the issue is then how to divide the revenues that may arise from the use and exploitation of the recording.
Keep in mind that it may, in fact, be in your best interest to "get it in writing" if you have an arrangement with someone. This is especially true in collaborative situations. Otherwise, you run the risk of a disagreement later over the actual terms of the oral agreement, and it becomes your word against that of the other party. That is not to say that an oral agreement is not a binding contract, but a contract is easier to prove if the terms of the arrangement are in writing. A simple contract may not necessarily require extensive involvement by lawyers. A contract can be as basic as an invoice, a receipt or a letter describing the details of your arrangement which is signed by both parties to the agreement: who is paying how much, and for what. However, at the end of the day, if you believe in yourself and your talents, give yourself the benefit of the doubt, and invest in good legal representation – all the successful producers do. Your lawyer can "translate" the deal and explain its terms to you, and then help negotiate more favorable terms for you as appropriate. My advice: never sign anything – other than an autograph – without having your entertainment lawyer review it first.
Wallace Collins is an entertainment and intellectual property lawyer with more than 30 years of experience based in New York. He was a recording artist for Epic Records before receiving his law degree from Fordham Law School.