Law is inevitably linked to every industry and it helps for the smooth operations of the particular industry. In the music industry, the creative aspects of music is linked with the business side through law and what the law does is to merge both sides and build it up to become a music business whether in form of recording agreements, publishing deals, endorsement deals e.t.c
The Nigerian music industry has witnessed recent endorsement deals of artists by various business brands from telecommunications to oil and gas companies, mobile phone brands and more, like; Burna Boy, Naeto C, Flavour, Lynxx, Waje amongst others, with Globacom, Iyanya with SOLO Mobile, Banky W with Samsung, Seyi Shay and Sasha amongst others with Etisalat, Wiz Kid, Lynxx, Tiwa Savage with Pepsi, Iyanya, Davido, Don Jazzy, Praiz amongst others with MTN and most recently, Tiwa savage and Don Jazzy with Konga. Nollywood stars are not left out either as quite a number of them including; Ini Edo, Desmond Elliot, Funke Akindele to name a few are Globacom ambassadors and Genevieve Nnaji unveiled by Amstel Malta in addition to her deals with MUD cosmetics and Etisalat.
Further, considering that record labels are in the business of making profits from their ‘valuable’ investments, they have to expand by taking a risk to sign on new acts they believe will add value to their business. For instance, the signing of Dija,Reekado Banks and Korede Bello to Mavin.
Let’s however slow down a minute and consider these agreements and what they entail. Do the artists understand what they are getting into when they sign recording agreements, publishing agreements or even endorsement deals?.!!
Before an artist signs a recording contract, he should know that not just the law of contract is at play here but a good knowledge of copyright law as well. Copyright over musical work is the most valuable asset in the music industry i.e this is the primary source of income generation and they usually grow in value.
Copyright simply means the rights a creator has over his work and these rights are enormous because it gives the owner full and exclusive control over the exploitation of his work.
When a record company signs an artist, the artist usually transfers his copyright in the sound recording (The recorded track of an artist you hear on a CD,iTunes e.t.c) and will get royalties in form of percentage from the album sales and from other rights that are attached to this copyright and this needs to be thoroughly negotiated as they vary depending on your ‘strength’ as artist. But it is important to know, that if you are the songwriter of a song then the copyright to the music composition remains with you, DO NOT transfer this right to the record company because you can earn from this as well in addition to your sound recording royalties .This entitles you to performance royalties, ringtones royalties from companies like MTN, GLO that use your song for ringtone purposes, Synchronization royalties from use of the song as background music in Tv shows, films, commercials e.t.c(This is also attached to copyright of sound recording and so you earn from that as well).
Also, negotiate on your royalty rates that will be derived from radio, clubs e.t.c that play your music as this is another deserving source of income.
Basically, copyright works for the mutual benefit of the artist/songwriter and the record company because they both make profit from this right. This is why it is necessary to understand how the law on copyright works so you can get the most from your rights and realize when these rights are infringed upon.
Celebrity endorsement deals have become a globally accepted and well established method of brand marketing to mostimes target a demographic that the particular celebrity appeals to. This has become a big revenue stream for Nigerian artists these days and while it all seems too good to be true to the artists, like all contracts entered into, they need to be cautious.
Before endorsing or becoming an ambassador of a brand, make sure it is a brand that you can align your brand as a musician with and not one that will tarnish or discredit your brand. That said, have your lawyer make sure there is a non-liability clause included in the endorsement contract. This is because as an ambassador of a brand, you are endorsing that brand as credible to the public and that by your representation, you want consumers to align themselves with the brand also. So, imagine if a consumer buys a Forte Oil product because Tiwa Savage said the product will make your car operate smoothly and the product ends up ruining the car. That consumer can sue Forte oil and Tiwa savage (yup!). As an artist, you do not want this kind of legal issue to affect your brand; you should include a clause that frees you from all liabilities associated with the brand and its products you endorse.
Another important factor to note when entering an endorsement deal is the Exclusivity Clause because the brands feel they are paying you so much, therefore they should ‘own’ you completely. While I get their point, it should never be forgotten that you are an artist and you can’t be too limited in your dealings. So, negotiate and make the exclusivity limited to your relationship, representation with the brand and not to your music as well. For instance, Just because Burna Boy is a Glo ambassador, he should not be limited from making music with Davido who is an MTN ambassador because it is a competing brand. Yes, Burna Boy can be ‘barred’ from wearing an MTN tshirt or going to chill with Davido at the MTN office but that should be about it!. To the artists, please go through this clause thoroughly and understand the do’s and don’ts because it might cost you your endorsement deal should you not take this clause seriously.
Copyright and intellectual property rights also come into play in endorsement deals as well. The contract has to detail the extent of the right the brand has to the use of your music (Copyright), your name (Service Mark) or even your brand name/logo (Trademark) to promote its brand. This is very important to also consider in negotiating the amount of the endorsement deal, this is because, you should indicate that despite being the brand’s ambassador, you want to receive royalties for the use of your songs whether in TV or radio commercials for the brand e.t.c or for the use of your trademark and copyright to promote the brand. So, even though you are signing on as an ambassador of the brand, your permission to exploit your intellectual property right has to be sought by the brand and payment must be made. However, in situations where the song is written and recorded for the exclusivity of the brand then there can be negotiations on who should own the Copyright.
All in all, do not just see money floating in the air when you think endorsement deals or recording deals. Think more in the line of what does this mean for me, how does my brand benefit from this.
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