MBW Views is a series of op/eds from eminent music industry people… with something to say.
The following MBW op/ed comes from Tom Stingemore (pictured), the founder of sync data platform, ALLOY.
Stingemore was previously Global President of Sync & Creative at Hipgnosis, and has previously held senior sync roles at Universal Music Group and BMG.
The music industry’s sync licensing process is no longer fit for purpose.
Sync is arguably the last area of the music industry to be modernized, but at some point the upgrading of our of our sector has to take place.
The process of sync licensing has not evolved to any great extent for over 50 years but while we wait for that evolution, our artists, songwriters and rights holders are losing significant revenue due to the notoriously complex, unwieldy and time-consuming manual clearance process that prospective users of their songs are currently required to undergo.
What is the status quo?
Below, I have illustrated a typical example of the convoluted negotiation/approval/clearance/licensing/invoicing process that a client is required to go through to use just ONE piece of commercial music:
This can take several weeks, and as a result, users have no option but to attempt to ‘clear’ multiple songs on the basis that their preferred choice(s) will not be approved in time.
… and for each use of commercial music that takes place you can multiply the above workflow by a factor of at least four in the knowledge that a myriad of people have played a part in that arduous process just to make an agreement possible.
Yet despite this notoriously painful process, sync has become and remains a vital and growing revenue stream for the music industry.
What’s the problem?
The well-documented and ongoing atomization of the entertainment industries has led to an explosion of smaller, lower-value sync opportunities, all of which still require the same approval process.
Added to this, the ever-increasing volume of manual sync approval paperwork has become increasingly unsustainable for our commercial partners in the worlds of film, TV, advertising & gaming.
Record labels & music publishing licensing executives are now drowning in a sea of smaller, lower-value sync requests leaving them with less time and resources to focus on the bigger, higher profile (and higher value) opportunities – the ones that can really move the dial for an artist or song.
The amount of time being spent on this deluge of smaller sync deals is highly inefficient, but perhaps even more troubling is the fact that brands / agencies / productions that want to use our copyrights are now simply moving away from using commercial music.
When I started in this industry, brands would typically each make two or three commercials per year, and as such they were prepared to endure the music industry’s approval / clearance process once every few months.
However, those same brands are now making some 200-300 pieces of content annually, all of which require the same manual clearance process.
It doesn’t take a massive leap of imagination to figure out that a brand being asked to initiate an arduous three or four week process every single day of the year is simply not feasible .
So, for these hundreds of new pieces of content that brands are creating (often described as the ‘long-tail’ of sync licensing), our clients are having to find alternative solutions.
“We’d obviously all prefer to always use commercial music, but we just don’t have the time – or capacity – to clear all of the songs we now need, manually.” – Music Supervisor, July 2023
What does this mean for Artists & Songwriters?
With the issues I have detailed impacting on the licensing of commercial music from artists & songwriters, the global entertainment industry’s ‘long-tail’ needs are instead now being met by purpose-made / ‘utility’ music.
And it’s big business.
According to MIDIA Research’s estimates, all of the world’s record labels (combined) are forecast to generate ~$700m in global sync revenue this year, while library music (one component of ‘utility’ music) is forecast to make almost double that, at ~$1.3bn.
Library music’s billion-dollar industry is being driven not necessarily by quality but by the instantaneous, frictionless licensing experience that it provides… and that’s without factoring in generative A.I., which hasn’t even started to make a significant impact yet.
For the record, I have genuine admiration for the gains that library music has made; it’s clearly been very successful and it undoubtedly serves an essential need for a significant section of the entertainment industry.
However, in today’s sync economy the world’s greatest songs & recordings are increasingly operating at a significant disadvantage in the marketplace and that is an imbalance that our artists & songwriters need to be rectified.
Commercial music should not compete with ‘utility’ music on price – however in terms of ease of access and speed of licensing, our artists & songwriters are entitled to a level playing field.
To be clear, I’m not proposing that we fully automate the sync licensing process. Our long-awaited modernization should have skilled sync executives at the helm, and crucially, we need to give record labels & music publishers more control, while at the same time enabling us all to properly harness opportunities far beyond the current manual limitations that we all now experience.
The ‘long-tail’ of music catalogs.
As this ‘long-tail’ predicament continues to unfold, music companies are in possession of vast ‘oil-fields’ of back catalog songs, the vast majority of which are lying dormant and earning no sync income whatsoever.
For any company to have >97% of their assets earning $0 is clearly less than desirable.
It goes without saying that not EVERY song in a catalog will generate a sync but as it stands these many millions of back catalog songs are being demonstrably held back by the hurdles that we ourselves have placed in the way of their success; and all the while, ‘utility’ music continues to benefit from our collective inability to catch up.
Now, as a label & publishing executive of some 17+ years, I clearly have to accept a share of responsibility for the status quo, but I believe that as an industry we owe it to our artists & songwriters to find a way to turn-on this latent revenue, which is currently laying in our ‘oil-fields’ of songs & recordings.
So, what’s being done about this?
In an attempt to fix the situation, in recent years a number of Sync DSP/‘Retailers’ have emerged, with the aim of semi-automating the music licensing process – and in turn, enabling music companies to turn on additional revenue from the vast ‘long-tail’, for our artists & songwriters.
However, regrettably even these well-intentioned sync retailers have for a decade or so also become bogged-down in the industry’s disparate music rights ecosystem and are all negotiating with each of the music companies (for the most part unsuccessfully) in isolation, within a myriad of different deal parameters/data formats/moral restrictions/pricing models/upload criteria/deal terms, etc.
… As a result, NONE of these retailers have ANY significant level of commercial music on their platforms.
While this perpetual logjam is undoubtedly hurting the retailers, the biggest victims as I see it… are our artists & songwriters.
So, what’s the answer?
I believe that it’s time for the music industry – after many years of trying to finally come to the table in unison on behalf of our artists & songwriters.
We must work towards a solution that brings this hugely important sector in line with the innovations and advances being made in other areas of our industry.
The sync industry WILL be modernized, it’s inevitable, and it’s now time for us to decide – as an industry – if we want to be the ones to do it … and on our terms.Music Business Worldwide
