Licensing, Merchandising, and Distribution Rights
There can be some confusion regarding who exactly owns a copyrighted intellectual property sometimes. For example, if you grew up reading Calvin and Hobbes comic strips, you would probably see the comic strip syndicate’s name all over all of the collected edition books and the corner edge of the strip. So that might lead you to believe that the comic strip syndicate owns the copyright to Calvin and Hobbes, when in fact, the copyright is held by its original author, Bill Watterson.
A successful intellectual property is likely to pass through many, many hands over the course of its lifetime. If you take Star Wars as an example, the property has been turned into toys by several different toy companies, produced as a series of films by a couple different film production companies, written into novels by literally hundreds of authors at several publishing houses, published as comic books by D.C. and Vertigo comics, the characters have been printed on Tupperware, greetings cards, bumper stickers and birthday cakes, and every single one of these products is produced by someone else.
The way this works is through a number of things: Licensing, merchandising, and distribution.
Licensing is the act of basically loaning an intellectual property to another person or a company for an agreed upon period of time or production so that they can produce merchandise like t-shirts or toys. In exchange, the copyright holder might receive a flat fee, royalties per sale, or both. The copyright holder retains the copyright, though, and he or she is usually given the right to demand to give final approval on all merchandise before it goes out, so as to preserve the integrity of their original vision and not give the wrong idea to new fans.
Distribution is a little different.
In the United States, it has never been the norm for distributors and publishers to let copyright holders retain their copyright. A book publishing house, traditionally, buys the book outright from the author, with the author retaining absolutely no copyright ownership over the story or any of the characters.
However, a number of cultural movements within the artist community have kind of changed that. Artists got smart and started forming guilds and unions, threatening streaks if not given their fair shake.
Publishers and distributors rely on talent to stay in business. By virtue of the talent reserving the right to hold an embargo, it is becoming more and more true every day that it is in the publisher’s best interests to keep the talent happy.
On the one hand, this results in actors being paid ludicrous sums of money only for the movie to tank and the producers to be left footing the bill. But on the other hand, this has allowed struggling artists to turn their one-shot book deals into recurring income.
More publishers and distributors are offering royalty systems and allowing artists and authors to retain ownership over their creations. Because artists and authors usually prefer ownership over a few extra dollars for the initial, flat fee, publishers can’t really afford to offer such limited deals as the old “we’ll buy this property and it will be ours” anymore.
But just thirty years ago, if you’d gone into a comic book publisher’s office and said “You can print this, but I want some royalties”, the publisher would’ve literally died laughing. To be fair, comic books were kind of slow on the uptake, and it wasn’t until pretty late in the game that they began really treating their artists more like business partners and less like working stiffs, but in the 1960’s and 1970’s, it wasn’t exactly rosy all over for struggling artists and writers.
Luckily, here in the twenty first century, we have options. If you show your manuscript to a publisher and they say “We’ll only print it if we can own it”, you can go on the internet and put it up on a website. You don’t even have to charge for the content itself, you can just let advertisers put banner ads up on your site.
Just ten years ago, there was this magical aura applied to the idea of “getting your foot in the door” because the distributors kind of had a monopoly on the world of art and entertainment. Today though, through the internet and inexpensive printing shops, your foot is already in the door. If you want to make a living on your work as an author, a programmer, a musician, or anything else, all you need to do is show up with the goods. Somewhere out there, there’s a market that’s just waiting for you to come along. A distributor can be a big, big help, but they’re not the only game in town.
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