First of all let me state that I am not a lawyer and do not intend this information to be used as legal advice. I am a musician who, after trawling the web, found it next to impossible to find in one place how to legally release a cover version, what costs are involved, and how to obtain permissions and licenses - especially for anyone based outside the US. After much research, this is the situation as I have understood it. It's not exhaustive, but it covers a variety of situations, so I hope it saves you a few hours of trawling the net.
First steps - find the composer and publisher
To license a cover version, first find out the composers and publishers of your cover tune. You can use the MCPS PRS database to look this up, or the Harry Fox Agency's Songfile. This information will be required on some forms to apply for the necessary licensing, and on materials accompanying your release.
Video & YouTube
There are two options here - many people simply upload their cover tunes to YouTube and hope for the best, but be warned, this is an infringement of copyright. To combat this, YouTube has technology that is able to identify that the music you have uploaded may be an infringement on someone else's original composition. If you acknowledge the third party claim, one of two things will happen: the copyright holder can choose to let the cover version stand and run adverts against your video, and thus profit from it; or they may request it is taken down. This will put a copyright infringement black mark against your account - a few of those, and you will lose your account, so it's a calculated risk. The problem with this method, if you care about your account, is you don't know how the publisher will react until you have uploaded your cover. There is a safer alternative - ask the song publisher directly for a video sync license. The cost - if any - will be agreed between you - there is no set price for a sync license.
Streaming Services e.g. Spotify
Streaming services have their own license agreements to stream cover songs, including yours. Therefore if you get yourself played on these services, any payments you receive via your intermediary/distributor (e.g. Tunecore or similar) will already have had any monies owed to the publisher/composer deducted, and you need take no further action.
Commercial radio stations
Like streaming services, licensed radio stations have their own agreements within their licenses to play cover songs. As a band, there is nothing further you need to do, other than make sure the info provided in your CD or MP3 accredits the original composers correctly.
If you are playing in a bar that is licensed to play live music, your cover tunes are covered by their license – no further action is required by the band.
Digital downloads for sale in US stores
(via a distributor like Tunecore or CDBaby.) It is your responsibility to pay the royalties to the publisher at regular intervals.. However you can use a mechanical license clearance service like Limelight to do this for you if you buy your licensing through them. (See below for further details.)
Digital downloads for sale in territories outside the US
The situation is different outside the US, You can use a distributor like Tunecore or CDBaby to distribute your downloads to non-US stores such as iTunes in the UK, or Amazon UK – royalties owed to the original writers are collected from the store automatically by local performing rights societies e.g. PRS in the UK. Your band never see that portion of the revenue, and neither does your distributor – the digital download provider (e.g. Amazon UK) pay any royalties owed directly to the local performing rights society, who in turn pay the publisher. Any money you receive for download sales via the distributor has already had the royalties deducted.
Licensing physical CDs, digital downloads, ring tones, and streaming off your own website
If you are based in the US...
While there are ways to get the correct licensing yourself, perhaps the easiest way to this is through Limelight's song clearance service. Pay Limelight in advance for the number of copies that you estimate you will sell. At the time of press, Limelight's costs are an initial $15 per type of sale (whether CD, download, stream, or ringtone), plus a cost per item that you are paying to cover. If you are close to selling more than the initial amount purchased, you can order more at the same cost per item and a further $7.50 per batch (some volume discounts are available)
Advance royalty costs on top of the service fee are as follows:
Per stream off your music player: $0.01
Per download or CD sale if song is under 5 mins: $0.091
Per download or CD sale if song is 5 minutes in length or longer: $0.0175 per minute or fraction thereof per unit.
It's different if you're based outside the US
If so, the situation is slightly more complicated. Limelight can still be used to cover your music player streams, digital downloads from US stores and ringtones. However, if you are getting CDs manufactured outside the US, you will need to buy licenses from the local licensors, e.g. for UK musicians, this will be MCPS/PRS.
UK-specific advice: Are your CDs for promo use only?
i.e. will you be giving them away free to reviewers, broadcasters etc? If so, apply for an AP4 license, at a cost of £0.005p per copy manufactured
UK-specific advice: Are your CDs for retail sale?
If so apply for the AP2 licence. Costs are 8.5% of Published Dealer Price (PDP), or if unavailable, 6.5% of Retail Price (RP) multiplied by the number of copies manufactured. The AP2 also allows you to create royalty free 25% of the first manufacture for use as promo copies. If this is enough for you, it will negate the need for a separate AP4.
Can I sell my cover on Bandcamp.com?
I want to give the cover song away for free – do I have to pay for that too?
Yes, whether you are using YouTube, or distributing your own free mp3s or CDs, you will still need to apply the same licensing rules above.
Summary of cover required
For each cover tune, a UK/US/international musician will need any or all of the following:
a Limelight license to cover US digital downloads, ringtone and music player streams
if based in US: a physical CD licence from Limelight to cover CD copies shipped
if based in UK: an AP2 license from MCPS/PRS to sell CDs (or an AP4 license if they are for promo only)
if based elsewhere: apply for a license to get CDs manufactured from your local licensing organisation
a sync license from the song's publisher to synchronise that song to video for YouTube and other video sites
a signed written agreement from the publisher in order to sell covers on Bandcamp.
You should be covered without additional licensing in the following situations:
playing covers in live music venues (covered by the venue)
commercial radio (covered by the station's licenses)
streaming sites such as Spotify (covered by the site)
digital download stores outside the US (covered by the download store), although I profess not to know every country's arrangements for collecting royalty payments
Once again, this is the fruits of my web research and I do not warrant it to be 100% correct or exhaustive – I hope you find it useful, but if you want expert legal advice I would recommend a legal expert!
By following my own advice, my band Kill or Cure were able to release our cover of Infernal's "From Paris to Berlin" in international digital stores and streaming sites, license a physical CD, and launch a licensed video on YouTube which you can see here:
Kill or Cure - "From Paris To Berlin"
About the Author: Dan Hepner is guitarist with UK metal band Kill or Cure, who have just released their self-titled debut album. Follow Dan on twitter or visit http://killorcure.co.uk for further blogs and tracks.