Song Composition v. Master Recording: Is One Inherently More Valuable?
An Op-ed on the Value of a Song Composition v. Master Recording
by Marc Caruso
There has always been a disparity in the royalty payouts between those for master recordings (sound you hear) and those for the underlying song composition (writing of music/lyrics). Out of the full price of a download, the current statutory mechanical royalty rate is 9.1 cents. This is paid out to the songwriter/publisher. The record label, who typically owns the master, keeps the rest of the net purchase amount after paying out the retailer. I accept that there should be some disparity in the free market. For years, record companies have foot the lion’s share of spending for record production, promotion, and marketing. A much more traditional approach than the expenditures typically incurred by the song’s publisher. However, the key point is that it should be decided and negotiated in the free market and not by government decrees and rate courts. In a market free of government regulation, it was decided that a synchronization license between labels/publishers and content creators value the song exactly equal to the recording. It shows that a free market should decide the license value between the two for digital streamers. This is the “willing buyer, willing seller” environment that the NMPA is fighting so valiantly for in Washington with the Songwriter Equity Act. If publishers were able to freely negotiate, like their label counterparts, the value of a performance and mechanical license with digital companies would be negotiated in good faith without the yoke of a standardized rate disparity and government regulation.
I recently attended a conference and heard a person arguing that the table crumbs publishers get as compared to record companies is fine because the recording itself has more value than the song. Again, I’ll accept the argument that more money is typically spent by labels in releasing a record, and a willing buyer, willing seller environment for negotiation would account for that. But I refuse to believe that the recording of a song inherently has more intrinsic value than the song itself. “Blank Space” is a song by Taylor Swift and blank tape is what the record companies would have without songs. Envision what a live Beyonce concert would be like if she just danced on stage in total silence. Interpretive theatre is not what she charges $200 a seat for. People go to hear her sing….wait….what’s that called? Oh yeah, songs.