Larry Mills is VP of Marketing & Partnerships with independent music licensing company Pump Audio (a division of Getty Images ).

 As everyone knows, the music industry is in a state of flux.  What we know and what we thought we knew changes every day.  While the revenue model for the artist continues to change – one constant is the potential for making money through licensing.

In the past, most artists saw their publishing royalties tied directly to the sale of CD’s and radio play, with the occasional movie, tv or advertising placement.  That’s different now.  With CD sales decreasing, on-line radio royalties not set, the need to increase ones synch licensing is vital in the business model for artists.

Licensing revenue and opportunities are much more expansive than many artists realize.  Everyday, thousands and thousands of songs are licensed for advertising, web, mobile, corporate uses, tv shows, movies and many more.  Not all of these songs – actually a very small percentage of these songs – are from major label artists.

How synch licenses work.  A content creator (TV production, advertising, media, corporate, web design, etc.), must acquire a license when they take music and use it as a soundtrack in their production.  They must pay (or negotiate not to pay) the artist, or the rights holder (record company, publishing company), for this license which allows them to use the music in their work. 

One of the major positives of the synch license is that the payments come directly to the master owner and song publisher – which means if you are an independent artist, you see that money right away.  For example – if an ad agency uses your track in an on-line advertising video and pays $2,000 for it – you as the master owner and publisher would get that check cut directly to you.  If you have a record deal, and don’t have a publishing deal, the label (master owner) may get half (if you’re not recouped), but by keeping your publishing, you would get $1,000 right away.

With a television placement, you not only receive money from the synch, but every time that show runs, the broadcaster must pay performing rights fees which results in the artist getting paid by their PRS (ASCAP, BMI, SESAC).  You may not receive much to have your song used on a reality show on MTV, but every time there’s a “Road Rules” marathon and your song is in there, that is generating performance fees for you.

There is also the ever needed ‘exposure’ that you as an artist are looking for.  There are great success stories of bands that have had a song in a movie, or an advertisement or as the theme song for a tv show, which has made their careers (see The Rembrandts, Feist, etc.).

I worked with an artist who placed a song in a Portuguese bank commercial and received around $10,000 for the spot.  The song became so popular that they have seen their fan base in Portugal (which has turned out to be mostly women) grow so large that they set up a tour, and have traveled over there three times in the past two years.

Now – this may sound all well and good, but there is still some work involved in getting these synchs, and there is no one way to go about it.  There are online licensing companies that feature and promote independent artists (for full disclosure, I work for one), there are also tons of music supervisors out there that are always looking for new music and finding them can be tough.  There is also the old fashioned way of reaching out to ad agencies yourself.  I would recommend all three (and all the other ways that you can think of).

If music licensing is appealing to you, I would also recommend cutting an instrumental version of each song you create while in the studio, and also 30 and 60 second cuts of key parts of the track.  In many cases, productions use instrumental versions (better for background music) and also like to have neat :30 and :60 cuts so they don’t have to do any music editing.

With the industry changing, the playing field is leveling off, and the money making opportunities are increasing – maybe the multi-million dollar record deal is a thing of the past, but the possibility of being a professional musician making money doing what you love is growing.