How Beat Lease Deals Work In 2021

how beat lease deals work in 2021

how beat lease deals work in 2021

Introduction

Historically, artists and producers have worked together to create songs from scratch, or in an exclusive relationship where the producer creates 1 beat which solely the artist uses. For decades now, a growing number of artists are using an alternative method to create their songs. Beat leasing, or non-exclusive licensing, is nothing new. But these days more than ever, artists are flocking to this, in my opinion, underutilized way of creating songs.

Let’s explore how beat lease deals work in 2021.

Beat leasing is quite simple and similar to leasing a car. A producer creates a beat, the underlying instrumental of a soon to be song, and puts it online for sale. The terms of the sale are such that the producer can resell the same beat unlimited times. This is called a non-exclusive agreement, or beat lease. 

In exchange for selling the beat unlimited times, the producer agrees to a substantial discounted price for the use of said beat. Typically if producers charge between $500 – $2,000 for a custom produced beat, they would lease the same beat for about $30. 

From the artist perspective this is a great way to save money on production while at the same time being able to create commercially releasable songs. Most non-exclusive contracts do allow you to release 1 song on the beat, but not all, so be sure to carefully read the contract before purchasing.

Beat leasing as a whole is essentially a supply and demand side marketplace. Let’s dive into all sides of the equation to understand how the model works on a deeper level. 

The Product Being Offered (Supply)

As mentioned above, a beat is simply the underlying instrumental of any song. Think about your favorite song on the radio. Now take away the vocals and you have the beat. Producers create beats without the need for vocalists or artists all the time, so it makes sense that they would want a way to monetize their creations.

Leasing their beats is a great way to generate revenue and a steady stream of potential clients. However, finding artists to use their beats is not easy. The beat leasing marketplace is extremely saturated these days so cutting through the thousands of other producers and getting your beats heard is difficult. 

Oftentimes it comes down to branding, running ads, or simply being established in the market. The producers who got in early selling beats when the competition was low are entrenched with artists and now have huge followings. 

 One pro tip that most all successful producers selling beats do is maintain an email list. Having constant contact with your clients is huge when trying to keep a business relationship. Especially when there’s so many options for artists, producers need to be top of mind as much as possible.  

The Customer Wanting To Purchase (Demand)

Artists and songwriters are typically the customers purchasing beats in this model. Although there are plenty of sites to license music for general use (YouTube, videos, podcasts, etc…) for the purpose of this article, we’re strictly talking about licensing beats to make songs.

The pros of using beat leasing to create songs from the artist point of view include:

  • Extremely low price point compared to custom production
  • Wide variety of choice
  • Convenience

Let’s touch on all the points in more detail.

When an artist hires a producer to produce a song, costs range anywhere from $300 – $2500 or more depending on the producer. And those fees don’t even include mixing and mastering. Take a look at the infographic below provided by Sounds Sphere to get a better idea of costs using non-exclusive licenses versus the traditional model.

Clearly there is a monetary advantage to using beat leasing, or non-exclusive licenses. Rather than spending their entire budget on production, artists can make their money go further for things like promotion and playlisting and still get the same quality production they would have gotten hiring an expensive producer.

There are hundreds of thousands of producers in the world trying to lease their beats so it makes sense that a big benefit of using beat leasing is having a wide variety of styles and sonic choices of music. 

Whether you’re creating a dancehall summer single or an emotional r&b breakup song, you’ll for sure find thousands of beats that have the vibe you’re looking for. Alternatively, if you hire 1 producer, who might be talented in multiple genres, you’re still going to get “their sound” on the song which makes it hard to do different types of songs with that producer.

It’s almost like leasing a car where you can try a bunch of options and change things quickly. This makes it very appealing for artists who want flexibility and options when it comes to their songs.

The final big benefit for artists is simply that it’s easier to lease a beat than work with a producer. With beat leasing, you can be in the middle of nowhere, go online, find a high quality beat, and get to work on your next single without any middlemen or connections.

These days with so many sites selling beats for producers, there’s a plethora of options that make it super simple to grab something you like and get to work. One caveat though is these sites have all historically been built for producers which means the artist experience isn’t great.

Sounds Sphere on the other hand, optimizes for the artist experience and makes it even easier to find tracks, understand contracts, and release songs. For a deeper dive on the various sites to buy and sell beats check out this article

The Logistics Of The Transaction

The main aspects of a beat leasing transaction are pricing, contract terms, and rights to the song. All 3 are important for artists to consider as historically, most non-exclusive contracts are not favorable to artists. 

Pricing is usually between $10-$100 for non-exclusive license leases with the average price around $25-$30. Artists can expect discounts for multiple licenses and oftentimes, producers even have “free beats” (we explain here why free beats are a bad idea) that artists can use. 

Since we’ve already covered a lot about pricing in the first section, let’s move on to the contract terms. A typical non-exclusive contract includes restrictions on the amount of times an artist can stream the song they create with the beat. Usually this is less than 50k (Sounds Sphere’s contract allows for 100k). 

Other restrictions include how many videos can be made, how many radio stations can play the song, and where the artist can distribute the song. All of these variables make it super important to pay attention to the terms before signing or downloading a beat since you might end up with no rights to your own songs!

Finally, who owns the rights and how the revenue is divided is the last important logistical element of a beat leasing transaction. Usually the producer of the beat will own 50% of the publishing rights and a portion of the master revenue as well (usually 50%). 

Having a 50/50 split with the producer of publishing and master rights  is the main tradeoff an artist needs to be aware of before using this model. Most artists are okay with this tradeoff since the price point is appealing and because if the song takes off, they can always come back and buy an exclusive license.  

Also, on some sites (like Sounds Sphere) artists can customize the beat to their liking, making it their own original song separate from the other artists who might have used that same beat. Legally, there’s nothing wrong with 2 or more artists having the same beat, but if an artist is concerned about other artists using their beat, they could consider customizing the beat to make it more unique. 

Conclusion

Beat leasing hasn’t changed much since its inception in the early 2000s, but with sites like Sounds Sphere changing the landscape, it’s something to consider now more than ever as a viable way to create songs as an independent artist.