Last Christmas – Copyright and sound recordings

One of this Christmas’ big film releases is Emma Thompson’s latest blockbuster, Last Christmas – which of course incorporates the Wham! 1984 Christmas hit of the same name in its soundtrack.

With the third anniversary of George Michael’s death falling on Christmas Day, there has been chatter in the media about posthumous royalties and what happens to an artist’s copyright interests following their demise.

One thing to note is that the biggest and most successful acts often see a huge boost in their royalties in the first year or two after death; it’s well documented that Michael Jackson has “earned” over $2bn since passing away, and Elvis Presley’s estate brings in tens of millions of dollars each year. But where does the money go?

First of all, it’s important to understand the two primary forms of copyright in the music industry: copyright vesting in a musical composition, and copyright vesting in a sound recording.

A musical composition is usually registered as a work of performing art and consists of music together with accompanying words. It may be in the form of a notated copy (i.e. a manuscript) or a rough recording (which could be on a phone, laptop or tablet and doesn’t need to be professionally produced).

A sound recording is a “fixation” of sounds, which could be musical or spoken. The author of a sound recording is the “producer” (lower-case “p”!) who is the individual or individuals who made the substantial arrangements for the recording to take place – often this is the performer whose performing is fixed, together with the record producer who processes, edits and mixes the recording.

Importantly, copyright in a sound recording is not the same as, or a substitute for, copyright in the underlying musical composition. So, an artist such as George Michael (who wrote as well as performed many of his songs) gains two copyright interests: one as composer and another as performer. Copyright in a composition subsists until 70 years after the calendar year in which the author dies, and copyright in a sound recording until 70 years after the recording is first published (or 50 years after it was made, if it remains unpublished or unplayed in public).

The royalties that are generated all go into the estate of the deceased, which means that successful musicians should always carefully consider their estate planning, as it’s highly likely their chosen beneficiaries will stand to receive royalties for many years.

Although his death was unexpected, George Michael had planned his estate meticulously: despite being single, childless and relatively young, he put his affairs in order early in his life. The estate consisted of his existing legacy (thought to be around £100m) together with ongoing royalty rights and income generated from the estate, and the information that has emerged shows that George Michael was a shrewd investor, generous friend and keen philanthropist.

As well as benefitting various family members, his estate also continues to make gifts to charities such as the NSPCC and AIDS charity Project Angel Food – further evidence of good planning on his behalf, and an example of how much control we can have over our money long after we’re gone.

But what of the future? The original single release of “Last Christmas” generated money for the Ethiopian Famine Appeal, and it would be unsurprising if the significant sum that will be earned off the back of the film release doesn’t benefit similarly deserving causes. And if invested, managed and distributed wisely, there’s no reason why George Michael’s generosity should not be felt far and wide for many decades to come.