What you need to know!
A screen composer’s income is usually split into two parts; the first part is an upfront fee, and the second part is royalties generated from the public performance of your works.
The Upfront Fee
The upfront fee covers your costs to create and produce the commissioned score. Depending on the nature of the commission these costs will vary, but at the very least the upfront fee needs to cover the cost of your time and your craft. Typically, this portion of the upfront fee is referred to as the composer’s fee.
In addition to your composer’s fee, the upfront fee almost always has to cover your music production costs in what is commonly known as a ‘package deal’. These costs may include live players, recording engineers, mixing engineers, studio time, orchestration, score preparation, orchestral contractors, assistants, and other costs that may be associated with deliverables such as 5.1 mixes or stems.
(Because music production costs vary so significantly across different commissions, ideally these costs would be borne by the production company and the composer’s fee would be negotiated separately. However, outside very high budget productions or Hollywood’s ‘A-list’, it is rare for composers to successfully negotiate such deals, both in Australia and internationally. We therefore encourage composers who have significant music production costs to breakdown these costs for producers and pass on these costs, either to be paid directly by the production company or via a higher upfront fee, whenever possible.)
The upfront fee also has to cover the hard costs associated with running your studio. These costs exist irrespective of whether you work in a professional facility or a bedroom, and include rent, rates, utilities such as electricity, gas and water, mobile and fixed internet plans, website hosting and online cloud storage or delivery services. It also includes the initial purchase of, and maintenance/upgrades to studio gear such as computers, displays, monitor speakers, mixers, microphones, pre-amps, midi & audio interfaces, keyboard controllers, control surfaces, backup storage and even office furniture!
Then there is a significant outlay and upkeep for those of us who play instruments on our own scores such as guitars, keyboards, pianos, strings, woodwinds, brass, percussion or various other musical toys.
And finally, there’s the big annual outlay; the regular purchase of plugins, software, upgrades and sample libraries which are required so we can compete sonically and stay current, to deliver the highest possible production value in our music.
In summary, the upfront fee has to cover your time AND production costs associated with creating and producing your score AND hard costs associated with running your studio.
This is challenging for many composers. Indeed, while we strongly encourage screen composers to make a profit from their upfront fee, many composers would struggle to break even on a commission after taking into account all the above costs. This is especially true for emerging composers, and for composers accepting commissions with high music production costs who neglect to pass on these costs to producers via a higher upfront fee.
Even experienced composers are unlikely to be able to sustain and grow a successful career from the upfront fee alone. Most screen composers therefore rely on the second part of our income to survive; royalties generated from the public performance of our works.
Public performance royalties
When your music is publicly performed or broadcast on television, radio, in movie theatres, pubs, clubs, shopping centres, gyms and more, the copyright owner of the work will earn a public performance royalty.
So how do royalties work?
Companies and businesses profiting from the use of music in their venues or on their platforms pay annual license fees to performing rights organisations (PROs) such as APRA here in Australia and the likes of ASCAP, BMI, SOCAN & PRS overseas. PROs then distribute these fees as public performance royalties to music rights holders worldwide. For you to collect these royalties you must belong to a PRO and maintain ownership of these public performance rights. (Click here for a more detailed discussion of royalties including definitions of the ‘Writer’s Share’ and so-called ‘Publisher’s Share’ of performance royalties.)
As mentioned above, because the upfront fee may not be enough to cover all the costs of producing a score, most composers ultimately rely upon these royalties (colloquially known as ‘back-end income’) to serve as our main income and our superannuation.
While royalties are small at the very start of our careers, they have the potential to grow significantly over time as we create a larger body of work that is performed or played publicly more often. This additional income allows us to invest in our careers, grow our business, and to service growing financial responsibilities such as mortgages and children. Talk to any established screen composer and they will confirm that:
Public performance royalties are crucial to enable the long-term survival of composers and songwriters! Without royalties we have no long-term viable business model, and no financially viable career path.
(It’s important to note that whilst we rely on these royalties over the course of our careers, for any single commission the amount earned is dependent upon the nature of the public performance / broadcast itself. As such, we composers must ensure the upfront fee is a fair and adequate remuneration for the work as royalties are not always guaranteed)
In summary, there are two parts to a composer’s income
The upfront fee - which includes time, music production costs and studio costs
Public performance royalties - which offset the lower upfront fees, and ensure career sustainability and longevity
Without both parts of this income, maintaining a full-time career as a screen composer is near impossible.
Increasingly production companies are demanding that composers relinquish their royalties, often without an increase in the upfront fee which would otherwise compensate the composer for the loss of future earnings. They are seeking to acquire not only a composer’s publishing (up to half of available public performance royalties) but the entire portion of public performance royalties, including the Writer’s share. This is not on! They are doing this by pressuring composers to agree to unusual work-for-hire agreements or buyouts thereby claiming ownership of the musical works themselves. Some are even aggressively pursuing direct license deals to circumvent PROs entirely. Recent much publicised practises by broadcasters and streaming services such as Discovery Networks and Netflix are examples of such behaviour. (Click here and here for the AGSC response and links to these publications, as well as the latest on the backdown from Discovery.)
Some international composers calculate that the cost of these sorts of deals could be up to 80-90% of their current income. (Fortunately, in Australia our APRA membership gives us some protection from the worst of these deals - click here for more information.)
This devaluing of music not only threatens our careers but has an unavoidable impact on quality, robbing producers of world-class scores which would otherwise showcase local productions on the international market. A great score helps a production get noticed and generates sales which is more important than ever in the global streaming era. For a composer to have the ability to produce a world class score, they must first be remunerated fairly for their work.
We screen composers rely on a combination of the upfront fee AND royalties to survive. This enables us to produce scores of the highest quality. As such, the AGSC strongly recommends that all Australian screen composers:
Keep your upfront fee as high as possible. Preserving your upfront fee is more important than ever in the streaming era when public performance royalties are currently between 10- and 100-fold lower than from traditional broadcast television.
Always retain your Writer’s share! If you are an APRA member you have already assigned these rights to APRA and they cannot be granted to third parties. While in some territories other than Australia it is possible to relinquish your Writer’s share, we strongly advise against this.
Retain your publishing. Historically in Australia it is not routine to hand over your publishing rights but if this is non-negotiable ensure you are adequately compensated for the loss of these or other rights. For more information click here.
Always charge for your services as a screen composer. There is no such thing as a free lunch!
Reach out to your friends and colleagues for advice when uncertain what course of action to take. We have seen first-hand the significant and tangible benefits of doing so.
Advocate for your interests. By doing so you strengthen the entire community of Australian screen composers!