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October 27, 2021

Comment: Do Licensing Arrangements With Record Companies Disincentivize Artists In The Music Industry?

Author: Intern - Pragya Gargee

The once defunct area of ​​music copyright law is seeing a surge of fees stemming from licensing arrangements for songs that are unaffordable by smaller businesses and up-and-coming artists. Latest music is more similar than different, and artists are using similar beats, samples and rhythms to meet the demand. When such basic samples are used to back copyright claims, individual artists are hesitant to experiment and innovate music. The author believes that such licensing arrangements with over-arching fees are detrimental to the growth of smaller/individual artists.

Nowadays, abstract qualities of rhythm, tempo, and the overall feel of a song are being used to chase down songs for simply ‘feeling’ like a previous song. In all genres, artists release new music with the same question in mind: Will this song throw me down the rabbit hole of exorbitant licensing arrangements?

Large companies with long catalogs of musical compositions are able to set disproportionate licensing fees and exhaust artists in the name of such abstract properties and sample packs. The most affected are independent creators, who are more often under-equipped to partner with these entertainment giants. For example, an upcoming musician who does a cover of a hit song will be slammed with high fees if he wants to share his cover publicly. Even coming up with their own compositions doesn’t help as sometimes big labels use very basic beats to justify their lawsuit against them and claim unreasonably excessive damages in a private settlement. Thus, smaller artists are prevented from innovating. Instead of promoting the creation of more music, copyright law in this context sometimes contribute to removing competition by giving larger profits to major records, who in turn use those advantages to out-compete smaller labels. This results in less incentive to make music as this becomes one of the factors which makes it difficult to market oneself and become profitable.

Simply put, artists who “win” the lottery by signing a license agreement with a major distributor are able to make huge gains over independent artists who do not have as much access to the public.

Artists are limited by what their record companies can afford while people other than the artists make financial decisions. Sometimes producers have to replace or discard their music because they can’t afford to clear the samples they want. Thus, the author is of the firm view that licensing agreements with major record companies can often leave vulnerable artists at a tightrope without the possibility of breaking into the market by paying such high licensing fees.

Disclaimer: Views, opinions, interpretations are solely those of the author, not of the firm (ALG India Law Offices LLP) nor reflective thereof. Author submissions are not checked for plagiarism or any other aspect before being posted.

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