Some producers sell lease and exclusive license for the same beat, but how is that even possible?

It can seem confusing at first, but it is possible to sell both a lease and an exclusive license for the same beat, depending on how the terms are structured. Let’s break down how this works.

1. Lease (Non-Exclusive License):

A lease typically refers to a non-exclusive license. This means that the producer retains ownership of the beat and is free to sell the beat to multiple artists under a leasing agreement. Here are the key elements of a lease:

• Non-exclusive: Multiple artists can use the same beat simultaneously.
• Limited rights: The artist buying the lease doesn’t own the beat; they can use it under specific conditions (like for a certain number of sales, streams, or performances).
• Limited duration: Often, leases have a time limit (e.g., 1 year, 5 years, etc.).
• Affordable price: Leases are generally cheaper because the artist is not getting full ownership or exclusive rights.

2. Exclusive License:

An exclusive license is different because it usually means the beat can only be used by one artist moving forward. The key features of an exclusive license are:

• Exclusive rights: Only the buyer can use the beat once the exclusive license is sold. No one else can purchase or use it after that point.
• Higher price: Since the buyer gets full ownership of the beat’s rights (subject to some contractual terms), the price is higher than a lease.
• Permanent: There are no time limits or restrictions on how the artist can use the beat (within the terms of the agreement).

How It’s Possible to Sell Both:

Here’s how some producers sell both lease and exclusive rights for the same beat:

1. Leases before the exclusive license is sold:

• Producers sell the beat under non-exclusive leases to multiple buyers.
• These buyers can use the beat under limited terms (for a set period, number of streams, or performances).
• However, since these are non-exclusive rights, the producer still owns the beat and can continue selling or licensing it.

1. Exclusive rights are sold later:

• If a buyer comes along who wants exclusive rights, they can purchase an exclusive license for the beat.
• The producer usually stops leasing the beat to others after the exclusive license is sold. The exclusive buyer then has the right to be the sole user of the beat going forward.
• Importantly, the previous buyers who leased the beat before the exclusive sale typically retain the right to continue using it based on the terms of their lease, but no new leases will be sold.

1. Existing leases still apply:

• Even after an exclusive sale, those who previously purchased a non-exclusive lease may still legally use the beat until their lease terms expire (depending on the terms of the lease agreement). The exclusive buyer would be the only one who could use the beat from that point forward in any new projects.

Example Scenario:

• A producer creates a beat and offers leases for $30. Five artists buy non-exclusive leases and use the beat in their songs.
• Later, an artist approaches the producer and offers $500 for an exclusive license to the beat. The producer sells it to that artist.
• After the exclusive sale, the producer no longer offers the beat for lease. The exclusive buyer now has exclusive rights to the beat for future use.
• The five artists who previously bought the lease can still use the beat in accordance with their leasing terms (e.g., until their licenses expire or they reach a sales limit).

Important to Note:

• Producers and buyers need to have clear, written agreements that specify the rights involved in both leases and exclusive licenses.
• If you’re an artist buying a beat, make sure you understand whether you’re getting a lease (non-exclusive, limited use) or an exclusive license (sole use, full rights).