Here at the Law Office of Vincent Miletti, Esq. and the home of the #UnusuallyMotivated movement, we take pride as a resilient and dependable legal services firm, providing such services in both a traditional and online, web-based environment. With mastered specialization in areas such as Employment and Labor Law, Intellectual Property (IP) (trademark, copyright, patent), Entertainment Law, and e-Commerce (Supply Chain, Distribution, Fulfillment, Standard Legal & Regulatory), we provide a range of legal services including, but not limited to traditional legal representation (litigation, mediation, arbitration, opinion letters and advisory), non-litigated business legal representation and legal counsel, and unique, online legal services such as smart forms, mobile training, legal marketing and development.

Still, we, here at Miletti Law®, feel obligated to enlighten, educate, and create awareness, free of charge, about how these issues and many others affect our unusually motivated® readers and/or their businesses. Accordingly, to achieve this goal, we have committed ourselves to creating authoritative, trustworthy & distinctive content, which looks to not only educate, but also deliver in a manner that only Miletti Law® can. Usually, this content is featured as videos posted on our YouTube Channel https://www.youtube.com/channel/UCtvUryqkkMAJLwrLu2BBt6w and blogs that are published on our website WWW.MILETTILAW.COM. With that, the ball is in your court and you have an effortless obligation to subscribe to the channel and sign up for the Newsletter on the website, which encompasses the best way to ensure that you stay in the loop and feel the positive impact of the knowledge bombs that we drop here!

As a way of responding to your inquiries and questions regarding legal representation and how to navigate legal matters concerning the entertainment industry, we have been updating our new L & E (Law & Entertainment) series with fresh, credible, and verifiable content. In our video titled “Infants & Entertainment Contracts” and Episode 5 of the L & E series, we discussed how unique entertainment contracts are when infants (individuals who have not yet reached the adult age) are involved. To keep discussion going, this blog is Part VI of our L & E (Law & Entertainment) series and an introduction to yet another interesting and informative video, Episode 6, titled “From Rags, To Riches, By Way of Royalties.” As usual, the video is accessible through the link provided at the end of this blog or as posted on our social media platforms.

As the video’s title suggests, we are going to focus on “royalties,” an interesting concept and exciting area of entertainment, particularly based on the long-term income that comes forth.

What is a Royalty?

Technically speaking, a royalty can be thought of as a general formulaic expression that give value to something based on an agreement between parties. In the entertainment industry, a royalty is a source and stream of income for artists and labels; just to mention a few, and may be expressed as a percentage of a certain amount of income. Thus, a royalty payment is a payment made to a party, usually the owner of a given asset, by another party for the right to the continued use of that asset. A royalty can range from 10% to 25% of some marker. For artists and labels, a marker may be the net or gross sales, album sales, ticket sales, and the like. When it comes to artists and labels, a unique aspect about royalties in the entertainment industry is that these boys and girls are very attached to what they do and want to be compensated for their work on a long-term basis. Again, most of their work can be considered as their intellectual property.

In most cases, labels hold the money and, thus, act as the bank where artists can draw. In some instances, an artist must wait until the label receives and consequently provides the money, which means that the latter could even pull it back at will. Thus, a royalty is often negotiated for between parties and involve a kind of compensation formulaic expression or some form of rules that provide a guideline on how the artist will be compensated. However, due to the dynamic and unique nature of the entertainment industry, royalties tend to fluctuate all the time, sometimes depending on an artist’s performance.

Type of Royalties

In the entertainment industry, royalties generally take four forms. The four types include Print Royalties, Mechanical Royalties, Performance Royalties, & Synchronization Royalties.

Print Royalties

Print, in verbatim, could be used to mean publication because of the modern digital print. Thus, print royalties are obtained from items such as scripts, sheet music (orchestra), text and scores.

Mechanical Royalties

These are royalties generated following the reproduction of a musical composition, whether physically (tangible medium) (on CD’s, records, tape recording) or digitally (intangible medium) through streaming, as downloadable content, or as mp3’s & wave files. Currently, the latter has gained significant popularity as we become a streaming society.

Performance Royalties

These royalties are generated through shows, performances, “on stage.” This is common when artists and musicians organize shows and perform live on stage.

Synchronization Royalties

Finally, these royalties are generated when someone uses an artist’s work in some film adaptations and variations, such as a song adapted in a movie as a theme song. A good example is RZA of Wu-Tang Clan, no preference here of course, doing Martials art’s scores.

One critical issue to know is that royalties are becoming an intricate matter every day. While forms such as the Print and Mechanical are very broad, the modern society is becoming more digitized and, unlike the traditional cassettes and tapes, more mediums for delivering various forms of entertainment, such as music, are being invented and created. Think of ringtones, wav files, streaming tracks, musical toys, computer games, etc. Accordingly, this changes the manner and fashion through which royalties are generated.

We invite you to view our video at https://www.youtube.com/watch?v=bI8bzQ4qUFA.

We look forward to updating this L & E series with more videos and blogs to keep you in the know about hot button issues related to entertainment law and the industry in general.

As such, stay tuned for Part VII of the series and strive to be #UnusuallyMotivated. In the interim, reach out to us with questions and/or comments on our website at the Contact Us page!

Always rising above the bar,

Isaac T.,

Legal Writer & Author.