Voice Over Actor and writer, Caroline Turner Cole explores the when, why and purpose of buy-out and usage fees for voice over.
As the video marketing industry continues to explode across the internet, with content becoming digitized and accessible to more clients and artists, many terms are used interchangeably (or incorrectly), which leads to confused clients, misinformed artists and generally misused jargon all over the place.
Today we’ll wade through the muddy waters of terminology related to booking and paying voice over talent and clearly define:
- usage fees
- basic session fees (BSF)
- commercial rights
- broadcast rights
It’s a lot to tackle, so we’ll do a fair amount of skating over the surface.
As a brief introduction, when hiring voice over talent, it’s important to understand that there are usually two separate types of fees involved:
- Basic Session Fees
- Usage Fees
Basic Session Fees
Essentially, a Basic Session Fee (also known throughout the industry as the BSF or simply the “session fee”) compensates artists for the time they spend creating the product. For example, attending a recording studio for 2 hours is a 2-hour session fee. The session fee varies per artist based on their experience, ability and availability. Session fees can range a lot, anything from $50 to $500 per hour of the artists’ time.
Usage fees are often referred to as licensing fees or a buy-out fee and are paid to the performer to compensate them for the value they add to the project over a defined period of time.
Things are further complicated by the fact that often in the United States, rates are presented as a package price, which include session fees AND usage fees together, instead of listing them separately. An example break-down of current US non-union fees can be found here.
Within usage fees (aka licensing fees or buy-out rates) there are many different layers, which would be impossible to fully go into here (or probably ever) as it can vary so drastically from project to project.
The basic principle is that usage fees INCREASE when the amount of people who will hear the voice over or see the video also INCREASES.
Bigger audience, bigger fees.
If you’re using the completed voice over internally within your company as a training video, or for non-profit educational purposes, for instance – the usage fees will be low. In fact, you don’t usually need to purchase any additional rights for this type of usage.
If the final product will be displayed publicly somewhere (yes, the Internet counts as a public space), or used for a promotional purpose of any kind, then you’ll need to make sure you’ve purchased commercial rights from the voice over artist or agency. Rates for commercial usage can vary depending on the type of content.
ALSO READ: Why Cheap Voice-Overs Will Cost You More
If the voice over is being used in a promotion or advertisement e.g. anything from a promoted Facebook or Instagram ad; to a local radio spot; to a national TV commercial – you’ll need to purchase broadcast rights. Again, rates vary but remember – bigger the audience = bigger the fees so a national campaign will cost more than a regional campaign.
Buy-Outs vs. Residuals
If you purchase the commercial or broadcast rights for a project with a voice over artist, you will also agree on HOW LONG the rights of usage last. Anywhere from 12 weeks to 1-2 years is typical.
For example: let’s say a customer purchases the broadcast rights to use a voice over in a local TV commercial and agrees that the spot won’t run for longer than 6 months. But, after 6 months they realize the ad is doing really well and it’s helping them find lots of new business (woohoo!).
Instead of creating a brand-new ad (which would cost WAY more money) they may want to run the existing ad again. In this instance, they need to make sure the contract they’ve created with the voice over artist has a renewal option or clause, allowing them to renew the rights to run the spot again if desired. These are residual fees paid to the artist or agent. So, they go back to the artist or agent and say “Hey, we loved that ad and want to keep it running we’d like to buy another 6 months” – or whatever length of time – and boom, it’s agreed. Extending the run of an advert is very quick with some forethought about renewal options.
A buy-out is the most extreme option of this, allowing a customer full use of the project in perpetuity, forever.
This sounds like it would be the simplest option for the customer (and in fairness who actually wants to go back to the agent or voice over artist every 6 months?) and yet…
A Voice Over Actor may not want to or be able to relinquish their rights
At Voquent we’ve seen an increasing request for voice over rates to include a full buy-out or ‘usage in perpetuity’ agreement. As stated above, it’s understandable. Customers may view it as the simplest option available to them because many customers are afraid of being prevented from using the material in the future without having to pay additional licensing / usage fees to the agencies or performers. This is a reasonable concern, when you factor in how easy it is to become disorganized and lose track of contracts and contact information for specific creative projects. Particularly in organisations with high staff turnover or where part of the project is sub-contracted to outside agencies. It’s much simpler to get a buy-out and not have to worry about it ever again.
Most artists accept this as fair method of working for internal projects or projects for small companies but when a performer is asked to agree to a lower than average fee and give away their rights in perpetuity for content that is in the public domain – it is viewed by many as exploitation and an attack on a talent’s rights.
If a client owns the right of usage in perpetuity, they can use the voice over wherever and whenever they like. Not just for the Facebook ad they originally purchased it for, but also splice it into a future radio commercial and if that’s successful, maybe they decide to expand the usage to a national TV commercial!
This is both unfair and unjustifiable to a voice actor to the same extent that it would be for any performing talent or artist. Their contribution continues on for as long as their performance is being used. Usage rights in perpetuity give the new owner the right to use the voice however, whenever and wherever they want. And if a voice over talent has only been paid a couple hundred bucks, that’s not a fair exchange for the permanent use of their voice.
Experienced performing talent and artists who are used to being paid residuals, may instantly refuse such a request because they are a union member or it may not fit with how they are used to working. The phrase “in perpetuity” will cause some artists to decline a contract immediately and definitively.
However, we all have to move with the times.
Video content increasingly dominates and many videos are now created with a low budget. It’s so easy to create reasonable quality video on the cheap.
Hiring an experienced voice over artist can look disproportionately expensive compared to the rest of the video production budget and yet, high quality voice over can greatly increase the quality of the overall product and it’s success with the intended recipients – the investment is definitely worth it, in terms of audience engagement alone.
ALSO READ: 7 Dos & Don’ts of working with Agencies
Basically, there’s more content being produced, more artists than ever, cheaper and more accessible recording equipment and all of this contributes to a disproportionately high volume of aspiring and less experienced talent prepared to work for lower prices to gain more experience resulting in an overall decline in rates.
At Voquent, we always try to educate customers about rates and usage, but occasionally we lose projects because they aren’t willing to stretch their budget to a level that compensates the artist and production team adequately. We don’t blame anyone for this trend, it’s merely a symptom of global market forces at work. The fact remains, a great deal of time and budget for an entire project can be wasted by trying to get a voice actor cheap at the very end. We’re here to be a bridge, to make sure clients get excellent quality audio and video projects for their budget whilst ensuring that artists are compensated fairly. When the budget is set impossibly low, sometimes it’s best to decline politely.
Do you actually NEED a buy-out anyway?
Of course, there are projects where it makes perfect sense to include a buy-out in the rate e.g.
- Where there is Limited visibility – for example: if the content is only ever going to sit on a small YouTube channel, IVR telephone line or website and never be boosted/sponsored and in its lifetime it may only get a few thousand views and be forgotten amonst the mass of disposable internet content of yesterday.
- Where the usage is difficult to predict – for example: museum exhibitions, public announcements, or other recordings used in the public domain.
- Where the voice over is part of the product – for example: toys, electronics, video games or animations.
However, for anything that’s broadcast or promoted publically, usage fees should always be agreed based on the intended usage and duration of the promotion.
Most likely, the same content will not be re-used anyway. Spending extra to purchase a complete buy-out will drive the cost up for a peace of mind that simply isn’t necessary. All content has a limited lifespan.
People get bored of seeing and hearing the same things.
So instead of seeking a buy-out each time, customers should consider negotiating a usage fee based on the actual duration of the run and the size of the audience. It’s not only cheaper to purchase but it’s also fairer to everyone involved.
Bigger audience, higher fees.
Before you consider requesting a blanket buy-out of recorded material, that little extra effort to clearly define and state the intended usage will not only lower the cost, it will also widen the interest from potential talent who’ll be eager to offer you the very best performance that money can buy.
Sometimes creative teams don’t have all this information to hand and still have to build turnkey quotes for their own clients which includes a voice cost, we understand that. Sometimes the end client hasn’t decided on the media spend yet or which channels to target but it should be possible to give some idea. For example: is it a national or regional TV commercial? Is it being boosted only on Instagram or also on YouTube and Twitter? Those who are prepared to engage with their clients and discuss intended audiences are far more likely to demonstrate their understanding of the objectives at hand and secure a fantastic production contract. This is what sets you apart from your competitors who are all throwing around loose and poorly qualified guesses into an abyss.
We always ask our customers to summarize and bullet point the info they do have so we can make agreements in principle with the artists about the intended usage. This way, the clients get the best talent at a great price, the audience loves the production and everyone’s a winner!
Caroline Cole voice over actor and writer.
Al Black Voquent.com’s Production Director.
Italian voice talent Giacomo is the Voice Actor featured in the main image.