Making Money from Licensing – How the creators of Ghostbusters and Teenage Mutant Ninja Turtle

If you grew up in the 1980’s, or if you had kids growing up around that time, you may remember that there were actually two different “Ghostbusters” cartoons. One with a gorilla and a couple of guys riding around in a flying car, and another with four guys going around in an ambulance.

So how did the producer of either of these shows not get sued by the producer of the other?

In the 1970’s, there was a short lived television series called “Ghostbusters”. In the early eighties, Columbia Pictures purchased the rights to use the title for their film, “Ghostbusters”, with Bill Murray and Dan Aykroyd. They did not purchase the actual property itself, that is. They only purchased the rights to use the title. Incidentally, they did not actually know that there even was a show called “Ghostbusters” during the early production stages, and only later bought the title to protect themselves from potential legal action.

Kevin Eastman, co-creator of the Teenage Mutant Ninja Turtles, recently sold his entire share of the property to his former partner, Peter Laird. This means that Kevin Eastman cannot go out and make a comic book based on the Ninja Turtles without permission from Peter Laird.

Licensing is when you sell the rights to a property, a title, a character, a story idea, etc., without actually forfeiting any of your own rights.

For example, Universal Pictures has the right to make superhero movies about Ironman and Spiderman, but that doesn’t mean that Marvel comics cannot keep making comic books about these characters.

Licensing is, honestly, a great way to make money. In fact, many artists make more money by licensing their characters, music, or other creations to various companies than they do on the actual work itself.

What makes licensing such a popular option is simply the ability to make money by allowing established companies with higher production budgets to turn a marketable property into a financially successful, well advertised property, and all without giving up ownership. Peter Laird still makes royalty fees every time someone buys another Ninja Turtle, and, because he owns the property, he has veto power. Every toy that the company, Playmates, wants to sell, it doesn’t hit the market until it gets Laird’s stamp of approval.

Licensing can also refer to simply loaning a work itself, rather than just the idea behind the work. For example, you might hear a hit pop song in a movie. The musician, or whoever owned the copyright on that song, had to be paid licensing fees before they could put that song in the movie.

But in order to protect your interests when licensing your work or entering into a licensing arrangement with a licensor (person giving the right to use), you need to have a written contract. Licensing agreements lay down the terms and conditions under which the licensee (person receiving the right to use) can use the work for its benefit. Licensing agreements also lay out the compensation the licensee agrees to pay the licensor, as well as the licensee’s restrictions on the use of licensor’s work.

If you have created something that is protected by copyright or patent or trademark, consult an attorney to determine the best way to license your work.

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