Use of Music Glossary

 

1.     New Use

When music recorded under the terms of a specific Electronic Media Agreement is later used as product or content governed by a different Electronic Media Agreement a new  use is created and payment is due. This employer new use payment to musicians is for the further exploitation of their musical labor from one agreement medium to another.

Example 1: if an AFM Sound Recording is licensed by a record company to be used in a Motion Picture, musicians attached to the Sound Recording receive new use wages (and often other benefits) for the New Use into the Motion Picture.

The “source agreement” for the music (in this example the Sound Recording Labor Agreement) generally specifies how and under what circumstances a new use payment is due to musicians, and the general terms governing the new use. Then the “destination agreement” (in this case the Motion Picture Agreement) can further define the specific wage scales and other benefits (such as pension or residuals) which are due for the resulting new use.

The employer attached to the destination agreement almost always makes the new use payment, but the original employer under the source agreement may use an assumption agreement to transfer obligations to another entity. The Assumption Agreement specifies transfer of payment obligations for other possible musician benefits like pension or residuals.

Except for motion picture and TV soundtracks, Broadway cast albums, and certain specified commercial new uses (all of which are processed and billed by the Local), new uses are generally processed and billed by the AFM.

SAG-AFTRA often uses the term Conversion or Re-Use where the AFM uses New Use.

2.     Re-Use

When music recorded under a specific media agreement is used again within that same medium a re-use occurs. Generally, re-uses require additional employer payments directly to musicians, though not always. An example of “free” re-use under the Sound Recording Labor Agreement occurs with the re-mix of an album, or releasing a version with English lyrics and another version with Spanish lyrics. An example of “free” re-use under the Motion Picture Agreement is the creation of special edits of a film for purposes of promotion or review.

Though the terms are somewhat modified from agreement to agreement, paid re-use most commonly occurs under the Live TV/Videotape Agreement (also called replay rates) and the Commercial Announcement Agreement (also called commercial cycles). Like new use payments, re-use payments generally include Pension contributions, but unlike new use, re-use often includes H&W contributions as well.

Live TV Re-Use occurs when a broadcast show, i.e. Saturday Night Live, rebroadcast on free television. Live TV also contains a particular type of re-use attached to foreign broadcast.

Commercials Re-Use can occur in the form of re-use cycles (13 weeks; 52 weeks etc.,) or also as a re-use for introduction of the commercial into a new region or the re-activation of a commercial which has gone unused for 2 or more years.

Re-Use payments and work dues are usually collected and processed by the applicable Local, with a defined portion of the Work Dues (depending on the Agreement) going to the AFM.

Note: SAG-AFTRA often uses terms like residuals, residual base or use fees in areas where the AFM uses the term Re-Use.

3.     Clip use

These are indirect Employer payments to musicians, which are collected and distributed by the AFM. The payments are usually quite small because they are often lump sum payments ($750 for example) that are then divided amongst all musicians attached to the clip ─ be it one musician or one hundred. Clip payments are distinguished from re-use and are most prevalent under the Live TV/Videotape Agreement or the Motion Picture and Film TV Agreements. Clip payments are rarely attached to residuals, pension or other benefits under the Motion Picture or Film TV Agreements, but that can occur under Live TV/Videotape.

  1. Live TV/Videotape Agreement examples of clip use might be excerpts from previous Tony Awards broadcasts being placed into a current Tony Awards Show retrospective ─ or a primetime Saturday Night Live special using “clips” from previous SNL seasons to create a tribute to a past host or star. When excerpts are taken from films produced under the Motion Picture or Film TV Agreements and then placed in a Live TV/Videotape program, a new use formula is used, although in the Live TV agreement it is still referred to as a clip.
  • MP and Film TV Agreement clip use occurs when a bit of music is taken from one TV show or movie and placed in another. For example, music from an episode of The Simpsons being used in the score for Family Guy, which generates a clip payment to musicians who worked on the originating Simpsons episode.

4.     Cycles, Dubs and Conversions

These are all specific terms found in the Commercial Announcements Agreement.

  1. Cycles, as previously noted, are a particular type of re-use payment that allows for unlimited exhibition of a commercial in a particular medium for a specified period of time.
  • Dubs can be used to describe the number of commercials which may be produced from a commercials recording session, without additional payment; or the additional payment required when you extract more dubs from a session than the maximum allowed under the applicable session length. A commercials session includes both a Session Fee and an Initial Use or Initial Cycle Fee (generally 13 weeks of use)
  • Dubbing also describes a re-use payment that allows music used in a prior commercial to be adapted for use in subsequent commercials.
  • Conversion describes a new use payment for commercials used in different advertising media, for example, if music originally recorded for an online commercial is placed in a radio commercial.

5. Payments to Funds

AFM agreements in several areas require payment for use of music for cases in which rather than a traditional new use payment from the employer or licensee to each musician, the relevant collective bargaining agreement calls for a percentage of the licensee fee paid for the use to be sent to one of various AFM Funds. Since the payment is typically too small to be divided up among all the musicians, it is sent to one or more Funds for the general benefit of many musicians.

  • a. Under the Sound Recording Labor Agreement, if the license fee paid to the record label (SRLA being the source agreement) is below a certain threshold, rather than paying the musicians directly as a traditional new use, a percentage of the license fee is paid to designated Funds. For example, if the license paid to the record label (after 5 quarters) for the use of a sound recording in a Videogame is less than $30,000, a percentage of the licensee fee must be paid to both the AFM Pension Fund and, in a smaller amount, to the Music Performance Trust Fund.
  • b. Under the Live TV/Videotape Agreement, the company pays a percentage of the license fee to the AFM Pension Fud for the licensing of programs into “Diginets”, or secondary digital channels. These are the free digital channels that generally broadcast very old programs (The Ed Sullivan Show, etc.) for low license amounts. This pattern is in line with SAG-AFTRA and other union agreements.

6.     Protected Uses Under Other Agreements

The AFM “Major” Media Agreements are the Sound Recording Labor Agreement (SRLA), the Commercials Announcements Agreement, the Television Videotape Agreement (Live TV), the Theatrical Motion Picture Agreement and the Television Motion Picture Agreement. The AFM also negotiates and administers a number of other media contracts.

  • AFM Agreements cover Cable TV, Educational Television, Public Radio, Industrial Films, Independent/Festival Films, Videogames and other areas. These agreements generally provide for a similar range of New Use and re-use wages and protections as found in the major AFM Agreements. There are differences, but these agreements are generally tied to the most similar Major Media Agreement with regards to terms and provisions.
  • AFM Agreements cover Cable TV, Educational Television, Public Radio, Industrial Films, Independent/Festival Films, Videogames and other areas. These agreements generally provide for a similar range of New Use and re-use wages and protections as found in the major AFM Agreements. There are differences, but these agreements are generally tied to the most similar Major Media Agreement with regards to terms and provisions.

7.     Music Preparation

Musicians who perform services such as arranging, orchestrating, copying, proofreading, midi-transcription and other music preparation services are also party to many additional payments and benefits similar to those to which instrumentalists are entitled. There are some differences however:

  • Music preparation musicians are originally paid based upon an applicable page rate or sometimes an hourly rate; not a Session Fee. Accordingly, music preparation new use and re-use payments are similarly based on applicable page rates or a percentage of the scale wages which were originally earned. Payments for clips are allocated by the AFM based upon the size of lump sum payment and the total number of instrumental and prep musicians attached to the clip, unless another formula is agreed upon.
  • Music preparation musicians are originally paid based upon an applicable page rate or sometimes an hourly rate; not a Session Fee. Accordingly, music preparation new use and re-use payments are similarly based on applicable page rates or a percentage of the scale wages which were originally earned. Payments for clips are allocated by the AFM based upon the size of lump sum payment and the total number of instrumental and prep musicians attached to the clip, unless another formula is agreed upon.

8.     Fund Payments

Musicians (including those working in music preparation) also receive payments through various Funds. Depending on the particular Fund and the agreement being administered, payments may also be paid to musicians appearing in images as performers (sidelining).

While they each operate somewhat differently each Fund administers collections and distributions independently of the AFM or its Locals. The principal Funds are:

  • The Sound Recording Special Payments Fund (SRSPF) provides money to musicians from employer payments made to the Fund based on sales of sound recordings, music videos and concert DVD’s. The SRSPF also receives a percentage of total record label streaming revenues for distribution to musicians. The SRSPF also distributes a particular type of new use payment for sampling. Those payments occur when a portion of an existing sound recording is digitally embodied in the creation of a new sound recording. The SRSPF is an employer operated and controlled Fund with AFM liaisons. It is part of the AFM collective bargaining agreement with the major record labels, the Sound Recording Labor Agreement.

  • The AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund (AFM & SAG-AFTRA Fund) distributes royalties from various foreign territories and royalties established by government statute under U.S. Copyright Law to instrumentalists and session singers. This Fund collects money for the sale, rental, broadcast or webcast for sound recording or audio-visual material as applicable under each respective agreement. While initially formed by the American Federation of Musicians (AFM) and the American Federation of Television and Radio Artists (AFTRA), the Fund is an independent entity, established as a 501c(6) not-for-profit organization, supervised by both AFM and SAG-AFTRA Trustees. Unlike the other Funds, it is not the result of a collective bargaining agreement, but rather is based on U.S. Copyright Law.
  • The Film Musicians Secondary Markets Fund (FMSMF) distributes money to musicians who had been employed on obligated motion pictures and TV shows for secondary use of that product. The Fund collects and distributes payments when those covered projects appear on cable shows, direct-to-video product or in-flight exhibition as well as streaming exhibition. This Fund also administers certain products under the Live TV/Videotape Agreement. Like the SRSPF, this is an Employer-controlled entity with AFM liaisons. The FMSMF is part of the collective bargaining agreements with the film and television industries, the Theatrical Motion Picture and Theatrical Television Picture Agreements, and the Live TV/Videotape Agreement.

9.     Streaming

Streaming, or New Media, is the dominant mode of distribution across most of the AFM media contract areas. In general, streaming falls into:

  • Advertising Supported Video on Demand (AVOD)
    • Made For (originally created for YouTube, websites, etc.)
    • Moved Over (originally made for theatrical, TV, etc. and then moved over to YouTube, etc.)
  • Subscriber Supported Video on Demand (SVOD and HBSVOD)
    • Made For (originally created for subscriber streaming service exhibition, Disney+, HBOMax, Netflix, etc.)
    • Moved Over (originally made for theatrical, TV, etc. and then moved over to Disney+, Netflix, etc.)
    • HBSVOD (high production budget versions of either Made For or Moved Over)
  • Sound recording streaming
    • On-demand (Spotify, Apple Music, etc.)
    • Linear (Sirius XM, Pandora, etc.)