Home Video

The Home Video market (rentals, sales, etc.) has become one of the biggest profit centers for the motion picture industry. Home-video licensing is normally handled in one of three ways: (1) In the per-video royalty approach, the royalty paid is based on a set rate (usually from 8¢ to 15¢ per song) for each video sold. For example, if 100,000 cassettes are sold and a particular song has a 10¢ royalty, the payment will be $10,000. (2) Most video distributors demand that publishers accept a one-time buy-out fee for all video rights, regardless of how many videos might be sold (a fact of life in today's movie and TV-series episode market which must be faced and negotiated accordingly). (3) Under the roll-over advance formula, the producer or video distributor pays a certain advance for a specified number of videos, with additional predetermined sums paid as certain sales plateaus are achieved (for example, $8,000 for the first 100,000 units and an additional $8,000 for each additional 100,000 units sold).

© 2007 Todd Brabec, Jeff Brabec
For more information, check out the book Music, Money and Success: The Insider's Guide To Making Money In The Music Business (Schirmer Trade Books/Music Sales/502 pages) available for sale at Amazon.com, Barnes & Noble, Borders, Music Sales Group and www.musicandmoney.com.