	Copyright & Contracting Toolbox

	Production Kit

Step 5: Negotiate agreements to commercialise

A company can commercialise the project materials either:

directly;
under licence to third parties.

A licence agreement granting rights to any such third party will need to address issues such as:

the duration, degree of exclusivity and territory of the licence;
the copyright fees and royalties payable;
the medium for which the licence is granted (eg TV broadcast, online service, etc).

The focus of the PAML Pilot Project was on clearing the rights necessary to make a multimedia recording and create various Products (eg a documentary, an interactive CD ROM or a music CD). The process of commercialising those products generally takes place over an extended time, as and when the opportunities for commercialisation arise.

To the extent that the companies are simply selling products (eg direct sales of music CDs), there is no need to enter commercialisation agreements with any third parties. However, companies intending to commercialise their products by way of broadcast will need to enter agreements with relevant broadcasters under which they license certain rights to the broadcasters in return for an agreed payment or royalties. A broadcaster is likely to have a standard agreement under which it acquires a licence of the broadcast rights. Similarly, the companies commercialising their products through the SWIFT Digital Media Services broadband delivery system will do so under agreements with Cinemedia.

In each case where the companies commercialise their products by granting licences to third parties, they will need to ensure that the rights they have cleared in creating the products are sufficient to allow them to grant licences on the terms proposed by the third parties. The companies will not, for example, be able to grant 10 year commercialisation licences if they only have five year clearances from the rightsholders whose works and performances appear in the products.

Note:It is strongly recommended that companies seek expert advice before entering into commercialisation agreements.