I've been asked to compose a 20-30 sec piece as a theme for a new series of podcasts by a friend at a national magazine. I've never composed anything for commercial use before, and have no idea about how this bit of the business works.

As far as I understand (which isn't very), my options are:
1. Sell the piece it outright to the company (for how much?). They take complete ownership and I never have anything to do with it again.
2. Charge a fee for my time writing the piece (again, how much?), then collect royalties for every time it is used.

Which option is more normal, and how would I go about setting it up? The PRS website makes my brain hurt...

I hope I've made it all clear - I've been burned by other bits of the business before, and would very much like to avoid it happening again!

Thanks in advance!

Either is 'normal'. Personally I would not do either.
Your third option is this. License the piece to the client. You create a piece and copyright it. You then write up a legal agreement stating that for a fixed fee of £x client X is entitled to use the piece for podcasts of X magazine. You take agreement to an entertainment Lawyer and make sure that it is watertight.

As for how much? Pricing your work is the hardest part about being self employed! Factor in the time taken to compose the piece, any other performers necessitated, studio time (and lawyers fee)etc.. and what you think your piece is worth!

The beauty of this proactive approach is that you are paid for your work but you retain all rights. If you wish to use the theme or hook of the piece at a later date you may do so and unless you state that the client has exclusive use, you can use the piece elsewhere. You can also Put a limit on the time or state for the license must be renewed annually.

Royalties were devised so that when music or film was distributed by a number of outlets (differing radio stations, TV, etc..) the artist would be paid. You are looking at a sole distribution point for a singular piece. Don't overcomplicate things!

Good luck...

Good advice from Ceridwen. Couple of points to expand on: royalties - any royalty income is likely to be very small. As a podcast it's not going to be broadcast through any of the main media outlets, and so is less likely to turn up in any PRS sample. YouTube income is tiny in the first place, so even if it's available there you're still in bag of crisps territory. Maybe get in touch with PRS to find out their policy on podcasts and associated royalties? Which means it'd make sense to bump up your fee as much as possible - but here you're in a bit of a minefield, as it's now so cheap to license music from production music libraries (esp. non-MCPS outfits like AudioNetwork) that your mate may well back off if you wade in with a demand for a fat fee. If I was in your position, and was licensing (and not selling) the track to them for 12 months, I'd be happily surprised to get any more than £3-400 for my efforts.

Obviously there's a number of factors at play in terms of size of fee vs. what the newspaper wants - if they're just looking for any old thing to stick on their podcast, then it's hard to justify inflating your fee. But if they're specifically looking for something that you have composed (you're a name act in the genre they want to be associated with, or only you can come up with the goods in the specific niche you work in, etc), then it's easier to demand a better pay cheque.

Bearing in mind the fee might not be so big, hiring a lawyer to check your contract could well cancel out any profit - so try wording something simple yourself, along the lines of licensing them a track for a specific period (12 months?), attached to a specific podcast (so they don't scatter gun it across all their branding) and clearly stating that the copyright in the composition and sound master belong to you. If you're feeling adventurous you could cherrypick the legalese for all this stuff out of the PACT Composers Agreement - PM me if you want a copy to look at.

Good luck!

Thanks very much both of you! I'm feeling a lot more confident about this whole thing.

Licensing it to them sounds like the best bet, but I think that getting the lawyers involved would be a bit too costly! ex-reid, I've PMed you about PACT.

Thanks again!