There aren’t many topics hotter in the licensing world than a Gratis Licenses. As more artists develop in the industry and the amount of content being created continues to grow, gratis licenses are becoming a more common practice among licensors and licensees.
Gratis licenses are definitely not for all artists. It’s important to consider the specific opportunity, the stage you’re at in your career, and other factors before entering into situations where your music may be used gratis.
Some libraries and sync companies allow you to opt in or out of these types of opportunities. If you aren’t sure if you can opt out, or if you want a better picture of the types of deals your music is up for, never hesitate to reach out to your sync companies directly and they should be able to provide you some information.
What is a “Gratis License?”
First things first, it is important to know what a Gratis License is. In sync licensing, a gratis license permits the licensee to use a song with no upfront fees paid to the artist. In the bigger picture, they are exchanging the placement’s exposure and potential royalties for the upfront fee of the sync.
A gratis license request is most common among TV networks, supervisors, and indie film producers whose budgets can be smaller or non-existent. The mindset that many work under is, “If you don’t let us use your music with no upfront fee, another band will;” and unfortunately, for the most part, they are right. We worked with a production company that had a music budget for a pretty big reality show and they spent the entire season’s budget on two major label songs for the first and last episode of the season. This left $0 for indie artists’ music for the rest of the season. What did they do? You got it — they resorted to strictly gratis licenses (ugh).
Thankfully, gratis licenses carry some potential benefits that may make up for the lack of an upfront payment.
The Benefits to Gratis Licenses
Sure, exposure doesn’t pay the bills, but exposure can lead to money. If your song is placed via a gratis license on MTV’s Teen Mom II, you have the potential to be heard by over 1.6 million viewers in a single night. That’s a significant audience that many indie artists aren’t able to cultivate in an entire year, let alone in one night. Plus, those episodes will often air more than once through domestic repeats and may even air to a global market, which significantly raises your visibility among MTV viewers worldwide. So although this exposure doesn’t pay you directly, there are ways to maximize the potential that a sync can bring you via social media strategies (see Hashtag Hustle: How to Leverage Social Media to Maximize Sync Potential). One placement can raise awareness of your band to new audiences, resulting in increased song and album sales, more fans at your shows, and, now that you have a proven résumé, additional opportunities through other licensees.
Beyond exposure, there is a potential for monetary benefits to gratis licenses. Even though there are no upfront fees, many of these placements earn backend royalties, which can become a significant stream of income. The use, time, media, network, and a few other factors will determine the amount of backend royalties you will earn. Your respective PRO will collect royalties and pay them out to you. So, if you’re licensing your music on a gratis basis, you’d better be affiliated with a Performance Rights Organization; otherwise, you are letting the money you’re due slip away. Royalties are not an immediate lump sum payment, but these payments can add up over the life of a placement. And if you have multiple placements building on top of each other, royalties can be a substantial revenue flow for you.
The Downsides to Gratis Licenses
Like many aspects of the music industry, gratis licenses can be a gamble. Unfortunately, there is always the possibility that neither exposure nor royalties will be earned from placements. If this is the case, the benefit to be gained is as large as your current reach and what you personally put into the placement. Many times, these types of situations turn into a free use with little to no benefit to the artist beyond being a résumé builder. “Exposure” seems to have evolved into a form of currency thrown at artists for their work, but it often proves to be worthless if you don’t analyze the situation correctly.
A gratis license can also devalue your music within the industry. Think about it, if you give your music to a company for free, how do you ever expect them to pay for it in the future? You’ve devalued your music right off the bat, because now, for the most part, you’re operating at a set price point. This is why it’s important to evaluate every situation before jumping in.
Another thing that many artists don’t consider is the competition they create against themselves. Sounds weird, right? If you have your song with Company A and Company B and they are both pitching for a TV show, there could be cross pitching. One may have a gratis blanket deal in place with the network and the other charges $2,500 a track — and both companies may have your song available. Why would the network pay $2,500 of their show’s music budget when they can get the same song for free from the company that has a gratis blanket in place with them? It makes more sense for the network to go the gratis route.
Is a Gratis License Right For You?
There are a few things to keep in mind when considering whether or not gratis is right for you.
What do they offer to you and your personal brand? If you’re an artist who is hustling, you’re responsible for your brand in all aspects of your career. Consider how specific gratis placements will affect your brand. Who is their target audience? What is their messaging? What do they have that you don’t have and can’t get on your own? Make sure that the show and audience align with your brand so you can really benefit from the “exposure factor.”
Stand strong: many times they need you more than you need them. There’s a level of importance that you bring to the project. Think about how great a TV show can be with only dialogue and no music. They need you and your peers to bless their project with beautiful sounds. If a licensor is adamant about using your music, you have leverage in the deal. If they are working under the “give us your music for free or someone else will” motto, you have less leverage; so, it’s important to analyze the particular deal and see if it aligns with your brand and goals.
What platform will your music be used in? Asking this question is critical to determining if the placement will be eligible to collect royalties from a placement. There’s a huge monetary difference between a TV show airing on MTV with reruns versus an indie film that will be playing at a few film fests for a year. The TV placement gives you potential exposure, probable royalties, and a résumé builder, versus the benefit that indie film may provide, which is probably just a résumé builder.
Is there something you can negotiate to maximize your chances for exposure or royalties? One example I’ve seen in the past is when production companies and networks, in exchange of payment, offer chyrons to artists who aren’t comfortable with a gratis license. A chyron is basically is a text-only graphic that pops up during a show that says “Now Playing: Artist Name “Song Title.”” These are very common on MTV shows.
The Power Is In Your Hands - Go With Your Gut
It’s important to analyze your current situation and status within the industry, and to also talk with the rest of your bandmates, producers, and/or songwriters to see how everyone feels about Gratis Licenses. It’s also important to know what these types of placements can do for you immediately and in the future. Gratis, like many other things in the music industry, is a tool that can either help or hurt you depending on your level of knowledge and the strategies you apply to your career.