December 25, 2005
It's 50 Cent Calling. Collect!
This year, enough mobile phone users downloaded musical tones to rack up retail sales of about $602 million in the US, more than double the $277 million racked up in 2004, reports The New York Times
While the structure of a deal for the ringtone of a song can vary widely depending on the label and mobile service carrier, here is how a sale of "Candy Shop" (by 50 Cents, one of the biggest sellers this year) might break down, based on a retail price of $2.50:
CARRIER Provides the customers; transmits the tones on its network; licenses songs from the music companies; and sometimes pays for advertising. A carrier typically receives about $1.12, or 45 percent.
RECORD LABEL Provides the actual song recording. With "Candy Shop," the label must split its share with Dr. Dre and Eminem, who have stakes in 50 Cent's recordings. The parent label receives about $1, or 40 percent of the total, and out of that pays the artist a royalty. At an estimated 18 percent royalty, 50 Cent would receive about 29 cents.
MUSIC PUBLISHER Licenses the composition on behalf of the songwriter. "Candy Shop" was co-written by 50 Cent and the producer Scott Storch. Universal Music Publishing, which administers 50 Cent's songs, and TVT Music Publishing, which handles Mr. Storch's, split the publisher's cut and then pay their writers. The publishers collectively receive about 25 cents, or 10 percent. The writers are each estimated to receive between 9 cents and 11 cents.
PERFORMANCE SOCIETY Collects money for songwriters when their works are played publicly. The one that represents 50 Cent would receive an estimated 3.5 percent of the total, or roughly 9 cents.
Since the most popular ringtones can sell more than 1 million units apiece, a hit single should generate at least enough to pay a couple of months' worth of phone bills.
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