The Rudiments of Music Business (Every Artists Tutor)

The vibrant energy of the music business industry, particularly in Nigeria, can often feel like a gold rush, where pure talent is all that matters. But let me tell you straight, as someone who’s seen the game from the inside, the dream of stardom is absolutely meaningless if you don’t understand the business. The music industry, for all its creative flair, is a complex, multi-billion naira machine, and without core knowledge, you risk becoming a slave to it.

A deep understanding of the music business is no longer a professional advantage, it is the single most crucial element determining your longevity, your financial security, and ultimately, your ownership of the creative legacy you’re sacrificing everything to build. Trust me, signing that contract or even pushing your music independently without this knowledge can be the first step toward a devastating loss of both control and income.

The Non-Negotiable Core Knowledge You Must Master

Every artist, whether you’re a buzzing newcomer or an established star, must master three fundamental, non-negotiable areas of the music business before you even think about putting ink to paper on any contract.

1. The DNA of Your Income: Understanding Music Rights and Royalties

Music rights are the foundation upon which your entire financial future rests. Misunderstanding these foundational elements is the easiest way for an artist to lose their biggest assets, often in exchange for a meager upfront fee.

Your income stream flows from two halves of a single copyright, and you must protect both:

The Composition, or Publishing Rights: Think of this as the songwriter’s copyright. This is the ownership of the underlying structure of the song, the melody, the lyrics, and the fundamental composition. This half generates money from public performance on radio, in clubs, as background music on streams, mechanical reproduction from every stream play or physical unit sold, and synchronization when your song is used in films, TV, or advertisements.
The Master Recording, or Sound Recording Rights: This is the ownership of the actual recorded audio track, the version that fans listen to. The master generates royalties primarily from digital streams, physical sales, and non-interactive plays.

Crucially, you must use a Split Sheet before the recording session is even over. This legally documents the agreed percentage split of the songwriting and production credits, which directly impacts the publishing royalties that will be paid for the entire life of the copyright.

Finally, you must know your Performance Rights Organizations (PROs). Bodies like Nigeria’s COSON, or global entities like ASCAP and BMI, are responsible for tracking and paying those essential public performance royalties from airplay. If you aren’t registered and tracking your work, you are literally leaving money on the table every time your song is played.

2. Decoding the Contract, Avoiding the Debt Trap

A record label contract is not a graduation certificate; it’s a long-term legal agreement designed to protect the label’s investment. You must understand the fine print to avoid signing away your future creative and financial freedom.

Term and Options: You need to know exactly how long the contract lasts, the term, and more importantly, how many subsequent projects, usually albums, the label has the automatic right to demand, called the options. A carelessly signed contract can easily tie an artist to a label for over a decade, regardless of their own personal satisfaction.
Advance and Recoupment: The label will give you an advance to cover recording costs and sometimes living expenses. But remember this golden rule, you must repay this advance in full, plus any associated costs, from your share of the royalties before you see a single naira of profit. Artists need to know the true recoupment rate, which often includes the label’s marketing and legal fees, a situation that can keep you perpetually in debt.
The Royalty Rate and Cross, Collateralization: While the royalty rate is your percentage of the revenue, watch out for the predator known as Cross, Collateralization. This clause allows a label to use the profits generated from your successful album or venture to pay off any debt or deficit incurred on a failed one. This tactic is the industry’s secret sauce for keeping artists perpetually unprofitably “recouped,” a financial purgatory where you are successful but always broke.

3. Mastering the 360, Degree Deal

The modern industry standard is the 360, degree deal, a business model that is radically different from traditional contracts. This deal allows the label to take a calculated percentage cut from every single aspect of your career, extending far beyond music sales. This includes, but is not limited to, income from:

Live Performances and Tours
Merchandise Sales and Licensing
Endorsements and Sponsorships
Acting roles or other media appearances

Knowing this dynamic beforehand is essential. You must negotiate reasonable percentage cuts, which should logically be lower than what the label takes from music royalties, and absolutely must aim to retain the intellectual property ownership of your non, music assets, such as your merchandise designs. If you don’t own your brand’s merch, you are leaving an enormous revenue stream on the table for the label to sweep up.

The Three Core Branches of the Music Business

The entire music industry is fundamentally divided into three distinct, powerful branches, and every naira you earn flows through one of them. Understanding where each branch starts and ends is the secret to getting paid.

The Recording Industry (Masters): This branch focuses on the production, distribution, and monetization of the actual recorded sound. This is where Record Labels, Distributors (like TuneCore or CD Baby), and Streaming Platforms (like Spotify and Apple Music) operate. They control the Master Recording copyright. If you are signed to a label, this is the branch that funds your album and controls its release strategy.
The Music Publishing Industry (Composition): This branch deals exclusively with the Composition Copyright, the rights to the melody and lyrics. This is where Music Publishers and PROs (like COSON) live. Publishers work to license your composition for use in films, commercials, and cover songs, ensuring you earn royalties every time the song’s underlying structure is exploited creatively. This is often the most overlooked source of long, term income.
The Live Music Industry (Performance): This branch is responsible for connecting the artist with the audience in person, where the real money is often made today. It includes Booking Agents, Promoters (who organize the shows), Venues, and Tour Managers. This is the primary revenue stream in a 360, deal that labels want a cut of because tickets and merchandise sales are high, margin transactions.

The Nigerian Case Studies: Lessons from Shattered Deals

The lack of business literacy has been the undoing of many Nigerian artists, leading to public feuds, financial ruin, and stunted careers.

Mohbad and Marlian Music: The tragic case of Mohbad starkly highlighted the issue of Master Ownership and Contract Term. His dispute was allegedly over who controlled his work and income, issues that persisted long after his passing. A proper exit clause and a clear master transfer agreement are now seen as non, negotiable life preservers.
D’Banj, Don Jazzy, and Mo’Hits Records: The collapse of this empire was a textbook example of poor Partnership Agreements. The split demonstrated how even the most successful, multi, faceted business, when lacking clearly defined partnership structures, equity divisions, and asset separation, can implode, leaving a trail of legal and financial debris.
P, Square (Square Records): The famous split between the brothers was less about a label and more about the failure of a fundamental Internal Business Structure. Their disagreement showed that even family businesses need airtight legal contracts detailing revenue sharing, asset ownership, and the rights to use the brand name.
May D and Square Records: May D’s public claims after his departure highlighted issues of Welfare and Exit Clauses. His account suggested poor working conditions, unmet basic needs, and potentially unfair contract terms that left him disadvantaged despite his contributions to major hits.
Lyta and YBNL: Lyta’s exit was often attributed to disagreements over Label Investment and Recoupment transparency. It showed the desperate need for artists to understand exactly how advances are being spent, what financial records they have a right to audit, and the true cost of the label’s overhead.
Portable, Youngy Dee, and the Malian Records Saga: These smaller scale but equally volatile cases often involve highly informal or non,existent contracts with management or smaller labels. These disputes illustrate the dangers of Informal Contracts and Management Abuse, where a lack of legal paperwork leads to easy exploitation, threats, and financial ruin.

The Nigerian music industry, despite its global explosion, is littered with stories of brilliant artists whose careers stalled or were marred by conflict due to business ignorance.

1. Mohbad & Marlian Music: A Tragedy of Systems

The heartbreaking case of the late Ibrahim “Mohbad” Oladimeji is a stark, modern tragedy underscoring these issues. His public disputes with his former label, Marlian Music, and its head, Naira Marley, involved allegations of intimidation and unfavorable contracts. While the full details remain complex, it highlights a young artist potentially locked in a suffocating system. The subsequent controversies after his death, involving royalty payments, access to his masters, and public disputes, reveal a scenario where business entanglements can create immense personal and professional distress, even beyond an artist’s lifetime. It underscores the life-altering weight of a signature on a contract.

2. May D & PSquare: The Hitmaker’s Dilemma

May D co-wrote and featured on one of Nigeria’s biggest anthems, “Alingo.” Despite this massive success, his career did not sustainably soar to equivalent heights post-Square Records. While many factors are at play, it often points to a common issue: the structure of deals for featured artists or in-house producers/songwriters. Did he retain publishing rights to his composition? Was he on a work-for-hire agreement? Without core knowledge, a career-defining hit might not translate into lifelong, foundational wealth.

The stories of Mohbad, May D, Lyta, and the implosions of Mo’Hits and P, Square serve as painful, multi, million, naira lessons. When an artist lacks core knowledge of music business fundamentals, royalties, copyrights, contract terms, and the branches of the industry, they walk into negotiations blind, often exchanging a short, term thrill of fame for long, term servitude.

Understanding COSON: The Gatekeeper of Music Royalties in Nigeria

The acronym COSON simply stands for the Copyright Society of Nigeria. When we talk about it, we are referring to Nigeria’s primary and most recognized collective management organization, or CMO, which you might also hear called a Performance Rights Organization, or PRO. COSON is set up as a non, profit company, a crucial system officially approved by the Nigerian Copyright Commission, the NCC. Its mission is to manage and enforce the public performance and mechanical reproduction rights for musical works and sound recordings on behalf of its many thousands of members.

If you are an artist in Nigeria and your music is receiving commercial airplay or public use, understanding how COSON operates is the single most important step you can take toward guaranteeing you actually get paid for your work.

The Mechanics: How COSON Operates in Nigeria

COSON’s entire operational model is designed to tackle a fundamental problem within the music economy: the sheer impossibility for any individual composer or publisher to personally monitor every single time their music is played publicly across a country as vast as Nigeria and then negotiate a fee for it. By the same token, it is equally impossible for a single hotel, radio station, or club to track down and pay thousands of individual songwriters every time they press play.

COSON steps into this gap, acting as the essential clearing house that streamlines this massive financial and legal process through a system of collective rights management.

1. The Licensing Process

The first and most critical function of COSON is to authorize and license the use of music for commercial and public consumption. It grants bulk licenses to various commercial music users, essentially allowing them to legally play a vast catalog of copyrighted music. These music users include a wide array of entities:

Broadcasters: This covers all forms of traditional media like radio stations, television networks, and cable operators.
Hospitality: This includes commercial spaces such as hotels, clubs, restaurants, bars, and all types of event venues.
Retail and Corporate: This extends to shopping centers, various transport facilities, airlines, and any large corporations that utilize background music to enhance their business environment.

The fees charged for these licenses are carefully calculated based on various factors, including the precise nature and extent of the music usage, the estimated number of people exposed to the music, and the commercial value the music brings to that business.

2. Collection and Distribution of Royalties

After issuing the necessary licenses, COSON actively collects the stipulated fees from these music users. This incoming money is the essential revenue stream designated as royalties owed directly to the music creators.

Tracking Usage: COSON faces the complex task of monitoring or gathering usage data from all its licensees. Although technically challenging, this data is absolutely vital for ensuring a fair and equitable distribution process.
Distribution: Once the administrative fees necessary to run the organization are deducted, COSON distributes the collected royalties to its large pool of registered members, which includes songwriters, composers, performers, and music publishers. The core principle of distribution is that those whose music was used most frequently and broadly should receive the largest proportion of the collected revenue.

3. Enforcement and Advocacy

Beyond simple collection, COSON serves as the music industry’s legal watchdog, actively and vigorously defending the intellectual property rights of its registered members.

Legal Action: COSON possesses the legal authority to initiate civil proceedings and take defaulters to court. This is directed against any individuals or businesses that are using copyrighted music publicly or commercially without having first secured the necessary and lawful license. This crucial enforcement power is vital in Nigeria where copyright infringement remains a persistent and rampant challenge.
Reciprocal Agreements: COSON has smartly developed and entered into reciprocal agreements with numerous collecting societies across the globe. This means that if your Nigerian song is played in a bar in London or streamed on a foreign platform in the US, the foreign PRO collects the money owed, and COSON ensures that money successfully finds its way back home to the Nigerian rights owner. Conversely, COSON performs the same duty here, collecting fees in Nigeria for the use of international music.

The Current Regulatory Position

The Nigerian Copyright Commission, which has the statutory authority to approve and license CMOs, has been the central figure in resolving this dispute.

COSON’s Suspension: The NCC suspended COSON’s operating license as far back as 2018 following internal governance challenges, leadership tussles, and allegations concerning transparency and failure to comply with regulatory directives. Despite this suspension, COSON continued to operate, often arguing that as an exclusive assignee of performing rights from its members, it retained the proprietary right to enforce those rights in court.
MCSN’s Approval: Conversely, the NCC publicly declared and has affirmed that MCSN is the singular collecting society authorized to license, monitor, and distribute royalties for all genres of music, including both musical works and sound recordings. This declaration followed years of legal maneuvering by MCSN, including directives from the Attorney General of the Federation to the NCC regarding MCSN’s status. MCSN has emphasized that its approval was renewed and it has the sole mandate to engage music users.
The New Act and Regulations: The entire environment is now framed by the Copyright Act of 2022 and the subsequent Collective Management Regulations of 2025, which aim to strengthen the governance and oversight of CMOs. Under this new regulatory regime, the NCC has reiterated that MCSN is the licensed body for musical works.

The Ongoing Conflict and Its Impact

Despite the clear regulatory stance from the NCC, the conflict has not vanished entirely.

Legal Arguments: The fight has been waged in courts, with both societies relying on different interpretations of the Copyright Act and previous court judgments to assert their rights to collect. COSON has in the past relied on rulings that suggest an exclusive assignee of copyright can sue for infringement even without a CMO license.
Artist Movement: The confusion and the allegations of mismanagement leveled against COSON have caused several prominent Nigerian artists, including legendary figures like Onyeka Onwenu, to publicly announce their decision to withdraw their membership from COSON and affiliate with MCSN. These high profile switches underscore the lack of confidence some creators have in COSON’s ability to transparently account for and remit their royalties.
The Single CMO Debate: Historically, Nigerian law and policy, guided by the NCC, favored having only one licensed CMO per class of copyright, like music. While the new law may allow for more competition if existing CMOs fail to adequately protect interests, the current official position maintains MCSN as the singular approved entity for musical rights.

In summary, while COSON remains an entity with a large repertoire and strong historical influence, the Nigerian Copyright Commission currently recognizes the Musical Copyright Society of Nigeria, MCSN, as the sole body legally empowered to manage and collect public performance and mechanical royalties for musical works in Nigeria.

The Nigerian Context

It is important to acknowledge that the collective management landscape in Nigeria has historically been and continues to be subject to continuous controversy and legal disputes. This is particularly true concerning the designation of a single versus multiple authorized CMOs. While COSON has consistently been the leading and most visible body, ongoing debates and legal challenges involving other societies like the Musical Copyright Society Nigeria, MCSN, have led to a certain level of complexity regarding which entity holds the final and official authority to collect specific types of royalties at any given time.

Despite these necessary complexities, the core message for every Nigerian artist remains unchanged: registering your works with an authorized Nigerian CMO is the first concrete, vital step toward successfully claiming the public performance and mechanical royalties that are legally and rightfully owed to you.

A successful artist today is a savvy entrepreneur who understands that their talent is merely the product, but the contract is the business. Before you sign a contract or release a single, your first investment must be in legal counsel and business literacy. This knowledge is the only true master that can guarantee your ownership and freedom. For more information, I recommend Songbux.

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The Rudiments of Music Business (Every Artists Tutor)