Composition vs. Master: The Two Copyrights Every Music Investor Must Understand
When you invest in music royalties, what are you actually buying? It is the most important question in the space—and also the most misunderstood. You're not just buying a "song"; you're buying a specific income stream attached to a legally distinct piece of intellectual property.
Getting this right is the foundation of every smart investment. This article will break down the two foundational copyrights that underpin every single royalty payment: the Composition and the Master Recording.
The Musical Composition: The "Blueprint"
The first copyright is for the musical composition. Think of this as the blueprint of the song. It protects the underlying musical work itself—the melody, the chord progression, the rhythm, and the lyrics. It's the song as it would appear on sheet music.
What it is: The song's core structure.
Who owns it: The songwriter(s) and their publisher(s).
The Sound Recording: The "Master"
The second copyright is for the sound recording, often called the "master." Think of this as the finished building constructed from the blueprint. It protects a specific, recorded version of a musical composition. It is the actual performance that was captured in a studio.
What it is: A specific performance of the song.
Who owns it: The recording artist(s) and their record label.
A Real-World Example: Dolly vs. Whitney
The classic example to make this crystal clear is the song "I Will Always Love You."
Dolly Parton wrote the song in 1973. She and her publisher own the Musical Composition.
In 1974, Dolly Parton recorded a version of the song. She and her label own the Sound Recording of that specific version.
In 1992, Whitney Houston recorded a new, iconic version. She and her label own the Sound Recording of her version.
It's the same "blueprint" (Composition), but two different "buildings" (Master Recordings). Every time Whitney Houston's version is played, both sets of owners get paid.
Why This Matters for Investors
Understanding this distinction is the first step to proper due diligence. The different types of royalties—performance, mechanical, and sync—flow differently from each of these two copyrights. Which copyright earns more when a song is used in a Netflix show? Which one benefits most from radio play? The answers are fundamental to valuation.
Knowing whether you are buying a piece of the "blueprint" or the "finished building" is fundamental to understanding what you own and how you will get paid.
Learn More in "The Sound of Money"
This is a core concept we explore in detail in my upcoming book, The Sound of Money. To get more foundational knowledge like this, receive exclusive excerpts, and be the first to know when the book is released, join the official pre-launch list.
