Wednesday, October 10, 2012

Soundcloud, Getty Partner For Licensing

Bruce Houghton/Hypebot

SoundCloud has partnered with leading licensing company Getty Images to simplify music licencing. The new SoundCloud feature allows users to make selected tracks available for sync licensing directly within the SoundCloud player, and commercial users to request a license by clicking a "license" button on the player. But the opportunity comes at what some will see a high price to artists.

If a Soundcloud artist chooses to participate, flat fees begin at $99 for web site use to $200 for a one time podcast play on up to $1500 for wider corporate usage. If licensors want a track for an ad or film, they must to call Getty for a quote.

Artists Must Relinquish Control

To be eligible for placement, artists must give up 100% control of how their music is used. "Your agreement with Getty Images Music allows us to license your music to any client who is willing to pay money for its use," reads the company's FAQ. "The agreement you sign pre-clears all of your music for potential licensing."

The company's justification for taking full control: "Pre-clearance is a strong selling point for our clients who are more likely to use music that causes them less hassle."

If the music is licensed, the artist receives just 35% of the upfront licensee fee plus 50% of Getty Images' share, as publisher, of any backend performance royalties. Fair or not, 50% fees to companies that place songs and generate licenses are common in the music industry. But usually those companies (often publishers and song placement experts) actively solicit the usage. Getty's placements from SoundCloud's artists are at their core passive, with the potential licensor discovering the track on their own and requesting the license.

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