Music Publishing Advances for Independent Songwriters, 2019-2020

The music publishing advance, in its various forms, is the mechanism through which songwriters receive upfront income based on the anticipated value of their catalog's future royalty income. Understanding what publishing advances involve, what they cost in terms of rights and control, and when they are appropriate for independent songwriters required careful navigation in the 2019-2020 period, when the number of available structures was expanding at the same time that catalog valuations were increasing.

For independent songwriters working in country, Americana, gospel, and roots music, the publishing landscape offered several distinct deal structures, each with different implications for long-term catalog control and income.

The Traditional Co-Publishing Deal

The traditional co-publishing deal, the standard structure offered by major music publishers including Sony Music Publishing, Universal Music Publishing Group, and Warner Chappell, involved the songwriter retaining ownership of half of the publishing (the "writer's share") while assigning the other half (the "publisher's share") to the publishing company in exchange for an advance and the publisher's promotional and administration services.

In a standard co-publishing deal, the publisher's advance was recoupable from the songwriter's share of royalties: the advance would be repaid from the songwriter's future royalty income before the songwriter began receiving additional payments. The advance amount was typically calculated as a multiple of the songwriter's current annual royalty income, often ranging from one to three times the songwriter's trailing twelve-month royalties.

For a songwriter earning $50,000 per year in publishing royalties, a two-times advance would be $100,000, recoupable from the songwriter's ongoing royalties over subsequent years. The songwriter would not see additional publishing income checks until the advance was fully recouped.

The promotional value of the co-publishing deal, the publisher's ability to pitch the songwriter's catalog to artists, film and television music supervisors, and advertising agencies, was a genuine benefit that justified the publisher's share for songwriters whose catalog was not generating its maximum potential income through existing placements.

The Admin Deal

The administrative publishing deal was a simpler structure in which the publisher registered and collected royalties for the songwriter's catalog without taking ownership of the publisher's share. The songwriter retained full ownership of both the writer's share and the publisher's share and paid the admin publisher a percentage fee, typically ranging from 10 to 25 percent, for the registration and collection services.

For independent songwriters whose catalogs were already generating significant royalties through existing placements and who did not need the publisher's pitching services, the admin deal provided professional catalog management at a lower long-term cost than a co-publishing deal.

CD Baby Pro Publishing Admin, DistroKid's publishing admin service, and dedicated publishing administrators including Songtrust offered admin services at lower fee percentages, often in the 15 to 20 percent range, for independent songwriters who wanted professional registration and collection without co-publishing arrangements.

The Emerging Catalog Acquisition Market

By 2019-2020, a growing number of investment-backed catalog acquisition companies, including Hipgnosis Songs Fund, Round Hill Music, and others, were competing with traditional publishers for songwriter catalogs, offering large upfront payments in exchange for full or partial catalog ownership.

The catalog acquisition model differed from co-publishing in a fundamental way: rather than an advance recoupable from future royalties, catalog acquisition typically involved an outright purchase of some or all of the songwriter's publishing rights in exchange for a lump sum. The songwriter received the full payment immediately and relinquished the corresponding portion of future royalty income permanently.

For independent songwriters evaluating catalog acquisition offers in 2019-2020, the decision required careful assessment of the multiple being offered relative to the catalog's trailing royalty income, the songwriter's age and expected remaining creative output, and the songwriter's need for immediate capital versus long-term income security.

What Producers and Artist-Songwriters Should Know

For producers who write songs as part of their recording work, and for artist-songwriters who perform their own material, the publishing advance decision carried implications beyond the immediate income. Co-publishing deals that assign publisher's share rights for the writer's catalog typically include administration rights that affect the songwriter's ability to license the catalog in the future.

Understanding the specific terms of any advance structure, including the term length, the scope of rights assigned, the recoupment calculations, and the reversionary rights provisions, required either music business expertise or competent legal counsel before signing.

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FAQ

What is a co-publishing deal? A co-publishing deal assigns half of the publishing rights (the publisher's share) to a music publisher in exchange for an advance and promotional services. The advance is recoupable from the songwriter's share of future royalties.

What is an admin publishing deal? An admin deal allows a publisher to register and collect royalties for a songwriter's catalog without taking ownership of the publisher's share. The songwriter retains full ownership and pays a percentage fee for the administration service.

What is the catalog acquisition market? Companies including Hipgnosis Songs Fund offer lump-sum payments for full or partial catalog ownership, giving the songwriter immediate capital in exchange for permanently relinquishing the corresponding portion of future royalty income.

What are the key terms to understand in a publishing advance? Critical terms include: the advance amount and recoupment calculation, the term length and territory scope, the rights assigned (copyright ownership versus administration), and the reversionary rights provisions that determine when rights revert to the songwriter if performance benchmarks are not met.

When is an admin deal preferable to a co-publishing deal? Admin deals are preferable when the songwriter's catalog is already generating significant royalties through existing placements and the songwriter primarily needs professional registration and collection rather than active pitching and placement services.