Exclusives 28 October 2022

GRM Exclusive: The Legal Lowdown on Licensing In Games

28 October 2022

Written By: Imani Modahl

Game developer and publisher EA Sports has announced the soundtrack for its FIFA 23 game. The Soundtrack consists of over 100 songs, including songs form UK artists: Central Cee, Labrinth, FKA Twigs, Shy Girl and Hak Baker.

The use of music in video games can be a pretty big deal, especially in popular games like FIFA where the release of the soundtrack for the game is newsworthy in itself. The release of the soundtrack has inspired this edition of Law, Schooled which is brought to you in Collaboration with Urban Lawyers. In this article we will be giving an overview into the topic of copyright and licensing in the context of video games.

What rights subsist in a song?

Before looking at how rights can be exploited and monetised through licensing, it is important to understand copyright. Copyright protects original works. In England and Wales, the Copyright, Designs and Patents Act 1988 (the “Act”) sets out works that are protected by copyright.

  • Under section 1(1)(a) of the Act, the underlying musical work and lyrics are protectable.
  • Under section 1(1)(b) of the Act the sound recording (also known as a “master”) is protectable.

Who owns the copyright?

In relation to songs, often there will be more than one copyright owner. The copyright owner is usually the person who creates the work e.g the lyrics/the recording/the underlying music. 

What rights does the copyright owner get?

Under section 16 of the Act, the copyright owner has the exclusive right to deal with the work, including the right to: 

  • Copy;
  • Issue copies to the public;
  • Perform; and
  • Communicate the work to the public.

What is a publishing deal and how does it affect copyright ownership?

Using the example of a song writer, when a song writer signs a publishing deal they will usually get an advance, which is an upfront sum of money. As part of the publishing deal, the writer will often assign or licence copyright to publisher.

The publishing company’s role is to collect money on behalf of the song writer and turn a song into money through promotion and licensing. The publishing company will often be responsible for arranging for their artists’ songs to be featured on video games. The publisher will then get a cut from the royalties to make back the money paid to the writer under the advance. 

What is a record deal and how does it affect copyright ownership?

Record labels generally put money in to artists in order for them to record their songs. The record label will generally be the owner of the master. Traditionally record labels would make most of their money through record sales. 

With the digitisation of music, ‘360 deals’ have become more popular. A 360 deal is wider reaching that a traditional record deal and will usually allow record labels to receive a portion of income generated beyond the masters. For example through merchandise sales and live concerts. Often under a 360 deal, copyright ownership will be transferred to the record label.

How does licensing work?

To use a song in a video game, the video game company will need to ensure that they have obtained the necessary licence(s) from the copyright owner(s). This is usually covered under a “sync deal” which usually requires that a fee is paid in return for the licence. 

Are sync deals beneficial?

As a result of there potentially being a number of copyright owners in relation to a song, there can be difficulties getting all of the parties to agree to the sync deal. If the parties can all agree, then the use of music in video games can be a great opportunity for games and artists. 

The use of music has become synonymous with games such as Grand Theft Auto and FIFA. The use of music has allowed these games to cement themselves as more than just a game. User experience is enhanced, the games and their soundtracks have become a part of pop culture. For example, in April this year, Dr Dre released an EP within GTA Online. The first piece of music he had published since 2015. 

For smaller artists, being featured in a well known video game can be great exposure, allowing them to reach new audiences. The big sticking point however may be the licence fee. Guitarist Herman Li recently revealed that his band received a licence fee of $3,000 for the use of one of their songs on Guitar Hero. Despite this not being a huge amount of money, Li says that the use of their song brought his style of music to a bigger audience. For some artists this may be enough, however others might wish to receive a higher licence fee. Ultimately it is a commercial decision for artists and their team to seek to negotiate a deal that works for them.