Licensing is transferring the rights to a piece of music - sometimes one song, sometimes a snippet of a song, sometimes an entire album - to another party for a set period of time for a fee. There are a few different ways music licensing takes place:
A label may license an album for which they own the rights to a label or distribution company in another territory for that second company to market and sell in their area.
A musician may license an album to a label rather than signing a traditional record deal.
A company may license a piece of music to use in media/advertising/an event.
Music licensing deals can take many different forms, but all deals dictate a licensing fee, the time for which the licensing agreement will last and where/how the licensee can use the music.
