Lexicon
The terms the industry uses, and what each one does to the money.
Most of these words are explained badly on purpose. A term nobody understands is a term nobody negotiates. Every entry gives the definition, the mechanism, a worked example and a primary source, and the whole set publishes as an open dataset.
Credits
Economics
360 deal
A 360 deal is a recording agreement in which the label takes a percentage of income streams beyond recorded music, such as touring, merchandise, endorsements and publishing.
EconomicsAdvance
An advance is money paid to an artist up front against future earnings, charged to the artist's account and repaid out of their share of revenue.
EconomicsAudit clause
An audit clause is the contractual right for an artist to examine a label's or distributor's books to verify that royalties were calculated and paid correctly.
EconomicsControlled composition clause
A controlled composition clause reduces the mechanical royalty a label pays a songwriter-artist on songs that artist wrote or controls, and typically caps how many songs per album are paid at all.
EconomicsCross-collateralisation
Cross-collateralisation is a contractual term allowing a label to recover the unrecouped balance of one project out of the earnings of another.
EconomicsDistribution fee
A distribution fee is the percentage a distributor takes for delivering recordings to streaming services and stores and collecting the resulting revenue.
EconomicsEscalator
An escalator is a contract term that increases an artist's royalty rate once defined sales or streaming thresholds are reached.
EconomicsMechanical royalty
A mechanical royalty is money owed to the owner of a composition when a recording of that composition is reproduced or streamed.
EconomicsPer-stream rate
A per-stream rate is not a fixed price paid per play; it is an average derived after the fact by dividing a service's payable revenue pool among rights holders by share of total streams.
EconomicsPlaylist placement
Playlist placement is the inclusion of a track on a streaming service's editorial or algorithmic playlist, which raises stream volume and therefore payout.
EconomicsPoints
A point is one percentage point of the artist royalty on a recording, most often used to describe a producer's participation.
EconomicsRecoupment
Recoupment is the process by which a record label recovers money it advanced to an artist out of the artist's share of revenue only, rather than out of total revenue.
Ownership
Black box royalties
Black box royalties are royalties that were successfully collected but could not be matched to the person or company entitled to them.
OwnershipMaster versus composition
Every piece of recorded music contains two separate copyrights: the composition, which is the underlying song, and the master, which is the specific recording of it.
OwnershipPerforming rights organisation
A performing rights organisation licenses the public performance of compositions on behalf of writers and publishers, collects the resulting money, and distributes it to its members.
OwnershipPublishing
Publishing is the business of owning, administering and exploiting the composition, which is the song itself, as distinct from any particular recording of it.
OwnershipReversion
Reversion is the return of rights to their original owner, either because a contract term provided for it or because a statutory right allows a transfer to be terminated after a defined period.