What is a Beat License Agreement?
At the core of every hip-hop track, there is a beat. Those beats must be created legally in order to be used without restriction in your own music and to be sold online. That’s what Beat License Agreements are for.
In its simplest form, a Beat License Agreement is a written agreement that allows the person who created the Beat (the Licensor) to sell or license their Beat exclusively or non-exclusively . A Licensor is someone who owns the copyright in a Beat and has the exclusive right to license the use of the Beat.
The Beat License Agreement covers all of the key provisions that both parties need, including whether the Licensor can sell his Beat to someone else, whether the Buyer can get a refund if the Beat is not used in a creative work, and whether the Beat can be re-recorded and released later on.
Key Components to a Beat License Agreement Template
A beat license agreement template is an important starting point for artists, producers, and songwriters alike to ensure the legal use of musical compositions or recordings. This section will discuss the key elements of a beat license agreement template that all parties should be aware of when entering into such a licensing agreement.
Licensing Rights. Licensing rights should be outlined in the agreement including whether the beat is being licensed for exclusive or non-exclusive use. In other words, does the artist want exclusivity of their recording to be used later by the producer? The agreement should also state whether the licensing rights are territorial or global. In addition, some licensing agreements include a provision stating that the beat may only be used for "fair use." The parties should ensure that the definition of fair use in the agreement is agreed upon by all parties.
Payment Terms. Payment terms should be included in the licensing agreement including how the producer will get paid and when. Additionally, the agreement should state whether the payment made includes all future royalties or if the producer will continue to collect royalties from the musical composition or sound recording.
Usage Restrictions. There should be usage restrictions included in the licensing agreement that state what the artist is and is not allowed to do with the beat or musical composition. For instance, the artist may want to restrict the producer from licensing the beat or musical composition to third parties, however, the parties may want to include a provision stating that the producer is allowed to include the track on certain online music sites or allow them to use it in their portfolio. The parties can also include a provision that allows the artist to utilize third parties to assist with the mixing of their sound recording. However, the parties should not allow the producer to distribute the sound recording or musical composition outside that specified by the artist (for instance, to a record label), unless the artist authorizes the same.
Types of Beat Licenses
The beat license agreement templates that you can purchase online usually refer to two different types of licenses: exclusive and non-exclusive licenses. An exclusive license means that the artist has acquired the exclusive rights in the beat for the duration of the license term. The exclusive license means that no one else, including the producer, can make music with the beat or use it for any other purpose during the duration of the exclusive license. The essential characteristic is technical exclusivity, such that the licensor will never have the right to use the licensable material in any way that contradicts the right of the licensee.
A nonexclusive license, on the other hand, does not technically mean that no one else can use the beat. It’s actually the opposite in that others can use it as long it’s on similar terms or that users of the beat agree to the terms the first licensee has entered into. However, this concept gets confusing because both the first and second users have an exclusive right in the material; it’s just that the first user has a broader and more expansive right to use the material. The second user’s right is restricted in some way by limitations in the original contract.
The beats are usually acquired through payment of a flat fee for the license that’s negotiated into the agreement. However, the consideration component of the agreement does not have to be in cash form, and often times the producer is more than likely to want a share of the song’s profits or to have the first right of refusal to buy an exclusive license at a later date.
Purchasing a nonexclusive license does not mean that the artist has all the rights over the beats. The producer will generally maintain some rights in the material even if they haven’t explicitly named in the contract. For example, it’s possible that they want to receive credit for the work, or that they want the first opportunity to purchase the beats at a later date.
If you’re a hip-hop artist or a music producer, an affordable option is to purchase one of many beat license agreement templates online. And the best thing about it is you can modify the template provided (that is, if you purchase the license template that is editable). Most producers make some changes to personalize the template for their circumstances.
How to Write a Beat License Agreement Template
Customizing a beat license agreement template is a relatively straightforward process, provided you understand the basics of contract law and have some experience with mapping out agreement structures. A good first step is to familiarize yourself with general music industry legal guidelines, and you can find plenty of examples online. There are also a number of organizations that provide free downloadable template agreements. If you’ve got access to a law library, you can find updated templates there. For many budding artists and producers, it makes more sense to contract a reputable music lawyer to draw up the draft version of your contract, but if you’ve studied the necessary aspects of copyright law and don’t mind getting specific, you might not need to spend the money.
Essentially, the beat license agreement caveats and stipulations are just like any other equipment purchase; you have to make sure you’re protected against damage, loss or theft. You also need to protect yourself from any third-party incursions on the work you’re selling. If your beat is protected by copyright, you can rest assured the purchaser cannot transfer full ownership of it unless it’s specifically permitted in the agreement.
As far as the template itself, a simple table with prices broken down is often sufficient for most cases. You would also be well served to provide a checklist of the template terms, using check boxes next to each one. As an example, you could include stipulations like: You may have additional caveats and stipulations to add; the amount you write is up to you. The table format is mostly for keeping everything clear and concise. If you create a license agreement template that’s 15 pages long, it may lose its usefulness to your intended market – which is primarily likely to be up-and-coming talent. When you pass a beat license agreement onto someone like Jay-Z or Dre, they’re likely to have their own lawyers review the terms (and probably change them a bit anyway). For your target market of typical artists, make it quick and make it easy to understand.
Mistakes to Avoid When it Comes to Beat Licenses
Musicians and producers frequently make a number of mistakes when they draft or sign beat license agreements. If you can avoid these, you will be far ahead of the game, even if you don’t have access to great legal advice.
Neglecting to Specify the Categories the Beat Licenses Falls Into
One of the most common mistakes that people make is not specifying the category that the beat license falls into. This could result in the artist having to release the song as a mixtape. A mixtape is usually understood to be a promotional tool, and not an actual saleable object. And if an artist releases a mixtape, the distribution may likely have to be limited.
Overly Broad Exclusivity Clauses
Many times, beat license agreements simply have bland and overreaching "exclusivity clauses." However, it is far better for the two parties to specifically agree to the level of exclusivity. If this is omitted, the producer could be disallowed from using the specific samples again. Similarly, if the parties do not agree on whether the artist has some right of first refusal to purchase exclusives in the future, there’s no telling whether the artist might try to buy that very same beat later on .
Not Requiring the Producer to Register the Works at Copyright Office
After a producer assigns the copyright to the artist in exchange for getting paid, many artists think that the song is theirs. But a better policy is actually to get the works registered right at the Copyright Office. Until it’s registered, anyone could stand up and claim their ownership of the work and the artist doesn’t have much of a remedy. Moreover, if you want to sue another person for copyright infringement, the work must be registered first. So if the work is registered and the artist licenses it, then the licensing process is easier.
Underestimating the Value of Master Rights
Often, producers and beats makers vastly underestimate the value of the master rights. At times, asking for 100% of the master rights might be impossible, but any beats maker should always be sure that a residual portion of the master rights is retained. Furthermore, the artist should also be required to issue a separate license (just like in movies) should the artist want to make a film out of the song too. This will allow the producer to recoup even more.
Advantages to Using Beat License Agreement Templates
The beat license agreement template offers several benefits for all parties involved in music production. For producers and musicians looking to use the same rhythm, sample or loop, this agreement sets out the terms clearly to avoid any disagreements.
As a producer, having this agreement saves time in drafting one from scratch. It also prepares you legally for various lawsuits that may arise from your music. You’ll also maintain compatibility through the beats in future projects, as it ensures that other people cannot create a song using your rhythm. Instead, it ensures that they are compelled to play your lyrics over their rhythm so that their song fits into your rhythm, as required by the music industry.
From your end, a beat license agreement enables you to set the price for your rhythm. Compensation for unsecured rights is only possible when there’s an agreement. It goes on to specify copyright ownership and affords you the protection to make copies of the rhythm or distribute it.
For the musician, there are a number of benefits to popping on a beat license agreement. They have the benefit of saving costs. Going the way of licensing for beats is significantly cheaper than buying a brand new rhythm. There’s also the discovery factor i.e., with a license, the musician can make their way into the producers sphere. There are several collaborations that wouldn’t have occurred if not for the helping hands of beat licenses. Also, there’s ease of access to the material. This allows for practice and exploration of the rhythm before sharing it with the world.
Overall, a beat license agreement is a win-win for both parties.
Sources for Beat License Agreement Templates
Musicians and producers can find beat license agreement templates from various online sources. Many websites, such as Law Insider and Rocket Lawyer, offer free templates for musicians and producers to adopt. While these are convenient, they are not specific to the needs of a producer. Several large independent music production labels, such as Busy Work Beats, Jethalebeats, and 9th Wonder’s The Drum Box, offer paid beat license agreements as part of their producer bundles or as stand-alone products. Many smaller independent music production labels offer custom beat license agreements directly or through online contract vendors. These licenses can be tailored to the producer’s needs and the needs of the particular beat. Some of these licenses specifically provide the option to add features like performance royalties or crediting the producer in any new musical work derived from the original licensed beat.
Lawyers and those skilled in contract drafting can easily draft agreements for producers. Small business law firms , such as ours, have a deep understanding of the rights of various parties. Therefore, handling non-standard language or one-off requests from producers is relatively simple. If the producer is unable to afford a lawyer to draft an agreement, many of the online templates and contracts reasonably priced to purchase are sufficient. Of course, the lower the price, the less explicit the contract is. If a contract is filled with much legalese, the producer must be careful to ensure that the agreement they are about to sign accurately reflects their intention.