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ANALYSIS: Music, Movies, Money and Fame | Alizier

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Job: Private Equity, Hedge Fund, Alternative Investments

With the emergence of sound films, music has become an essential part of the cinematography. The world's first sound film "The Jazz Singer" was released in 1922. Charlie Chaplin wrote the beautiful music for his pictures himself. Try to imagine a film without music – whether it is orchestral or electronic "backing", the latest hit, or a popular song – and you immediately will realize its role.

Today, the majority of feature films are produced in the U.S. – by the major Hollywood studios or by the numerous small independent companies. Independent companies can be very successful, having decent budgets or highly specialized and very small. The expenses of the film industry grow with cosmic speed – the average cost of a movie in 1980 was $16 million dollars, today it starts from $75 million and up. Because of the high cost, film production is financed from several sources – studios, investors, sponsors, specially created companies, etc. But regardless of the source of the money used for the film, all participants want to, at least, recoup the cost, and hope to make a profit.

Profit in this game can be as high as the stakes themselves. In 1976 only one film brought profit of more than $100 million after rolling in the U.S. and Canada; in 2000 about 200 movies brought the same profit to their creators. Additional revenue is gained during screenings in other countries ("Titanic" gathered about $1.8 billion, "Star Wars. Episode I" – "only" $920 million). Therefore, the profit from movie songs theoretically can be astronomically high – for example, Dolly Parton – author of the song for "The Bodyguard", performed by Whitney Houston, – received more than $600,000 just in copyright payments. But besides multimillion-dollar budget blockbusters, there are hundreds of movies being produced in the world. All of their creators are aiming to make a profit.

It is well known that the main stage for cinematography is movie-theaters. But also movies are released on DVDs, tapes, shown via cable and satellite networks. Soundtracks are used in different ways – songs go to the charts, get released on CDs, played on the radio, downloaded through the Internet, used as ringtones, put in commercials, and performed at concerts. All of this brings additional revenue to music authors and performers.

Film music can be divided into several categories:

• Background music and instrumental themes – for example, music by James Horner in "Titanic", famous theme by Ennio Moriccone from "The Professional" and great music of Nino Rota from the film's " "The Godfather"

• Already existing song, which is included in the new film – as with 1936 “J”Attendrai” by Rina Ketty in "Submarine" ("Das Boot"), "Hungry Heart" by Bruce Springsteen, "Fly Like An Eagle" by Steve Miller, "American Woman" by Guess Who, the whole soundtrack for the movie "Apocalypse Now", consisting of hits of bands of 1960-70's, soundtracks to Tarantino's films;

• Song written specially for the film – "You'll Be In My Heart" – a song by Phil Collins for the movie "Tarzan", "Over The Rainbow" – a song by Harold Arlen from "The Wizard of Oz", great songs by Isaac Dunaevskyfrom Soviet films of the 1930s and 50s.

Music creates necessary mood for all known movies and it gives to an actor the chance to sing, makes the audience laugh and cry. A good soundtrack maintains interest to a movie, and vice versa.

If a film producer wants to use already existing well-known song for the new picture, he doesn't have to contact the author or artists. He turns to the publisher for the permission (license). In ancient times, when there were no records, publishers released music scores. Some still do it today. But modern music publisher – is a special company or a record label, promoting songs in various ways, having all the necessary contracts with authors and performers.   ABBA's manager Stig Anderson, for example, started his work as a publisher. Paul McCartney owns his publishing company. Perhaps the world's largest publishing company today is American Harry Fox. It should be noted, that increasing number of national authors and producers prefer to work with international-level publishers.

Film producer buys from the publisher a license for the song. The price of the license depends on several factors:

• How the song is going to be used in the movie: will the actor sing it for the camera? Or it will go as an instrumental or vocal-instrumental "backing"

• What are the overall budget of the film and its musical-part budget?

• Method of film production – big Hollywood studio, independent company, a student's work or final project, amateur movie, etc.

• Standing of the song – hot hit, new song, known standard, jazz and rock-and-roll classic

• Duration of the song in the movie – 10 seconds, 1 minute, 4 minutes; and a number of times it will sound during the movie

• Terms of the license – 2 years, 10 years, the whole duration of copyright protection

• Area of use – USA, Europe, USA + other countries, any country

• Whether the song is included into the published CD-audio soundtrack

• Whether the original soundtrack is used, or the new arrangement/performance/re-recording is done

• Whether the song is used in the film as the main theme and at the opening

The average cost of a license ranges from $15,000 to $60,000 (usually $20,000 to $45,000). But it can be much lower for low-budget pictures or much higher if it is a well-known hit, or the whole plot is built around the song. The same song can have quite different price for different movies. If the film uses original studio master-tracks, the record label takes from $15,000 to $70,000 for the usage. Depending on the performer's popularity, duration of the song in the film and the total movie budget, price may increase (or decrease) proportionally.

If the song is played at the first minutes of a film, it is very good for the song and for the songwriter/performer. It is much better comparing to any other fragment, or during the final credits. Moreover, if the titles of the song and the movie match, it's a full-house – price of the license for the song (and songwriter/performer's profit) increases more than tenfold. For example: “The World Is Not Enough”, the title track of "James Bond", brought to Garbage in 1999 more income than the preceding numbered album. The band even recorded music clip for the original story.

Sometimes filmmaker buys the song license for the "festival" version of the picture. In this case the term of license is 18 months, and after movie’s duplication it has to be extended.

Song publishers can gain additional income from the usage of the song in promotional videos and advertising of the movie. But this applies mainly to high-budget blockbusters. Producers of low-budget, documentary and amateur films, on the contrary, ask the publisher to allow them to pay for the use of the song in the future, if the picture brings any profit.

Another story is students' works and graduation projects. Despite the fact that these works have micro-budgets, the publishers normally do not deny usage of songs on special terms. On the contrary, many Western publishers keep track of promising talented filmmakers and producers – because if they are successful a) they will continue to work with these music publishers, b) their students' works will be redone for a broader audience and will pay off the cost of the music.

Sometimes a filmmaker asks music publisher to change the lyrics, arrangement and make a new record according to the plot and picture's mood. Change of the lyrics is possible only through consent of the original text's author.

If a filmmaker guarantees that the song will be included into the CD-soundtrack, the publisher can reduce the cost of a license, because he will receive an additional profit with the release of the soundtrack. The cost of a license in this case can be reduced by 10-15 percent.

After the release of the movie, CD soundtracks and DVDs, all the money for the use of movie's music is flocking to the music publisher. Then he shares it with the music authors, performers and the record label (unless the publisher is the label).

It is a mistake to think that film music is a niche only for famous authors and performers. I was greatly amazed when in "Shrek" I heard a song by punk girly band The Donnas from the collection of a small indie-label Lookout Records (which I came across by in 1990s)…


The article contains materials of copyrights protection society ASCAP

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