SMALL BUSINESS – Staying In Tune

While it isn’t the sort of music that will keep you humming,

Megatrax’s melodies play a role in many big productions.

By CLAUDIA PESCHIUTTA

Staff Reporter

Ron Mendelsohn and J.C. Dwyer do not write oratorios or symphonies, and their music is not played in concert halls. But as co-chief executives of Megatrax Production Music Inc. in North Hollywood, their music has been heard on everything from TV’s “The Drew Carey Show” to the film “Memento.”

The company’s compositions come in the form of “cues” pieces of background music running from five seconds to five minutes that create mood for show scenes, movie trailers and other productions.

While some of the music is produced with synthesizers and outtakes of pre-existing recordings, much of it is created with live musicians. Dwyer and Mendelsohn have composed 10 percent to 20 percent of Megatrax’s music.

“Each piece is like a piece of art,” said Dwyer, who has been playing guitar since he was 13 and has a master’s degree in jazz studies from USC.

“(We) treat it like a real album,” said Mendelsohn, referring to each of the 125 compact discs that Megatrax has produced in its 10-year history.

Some clients pay on a per-use, basis. Others pay an annual licensing fee that gives them unlimited use of all 125 CDs in the library. That fee can range from $1,000 to $50,000 a year, depending on the size of the client’s audience. Megatrax also produces some original compositions, which are owned by the client.

The two musicians met in 1989 at USC, where both studied film scoring. Mendelsohn, a keyboard player, was helping put on campus musicals and needed a guitarist for a production of “Godspell.” Dwyer answered the call and both soon started up a band to play at parties and weddings.

Then, Dwyer became an intern in the music rights department at NBC and the two realized they could make a living by producing cues for television. Working out of Mendelsohn’s apartment, they spent a year on their first CD, “The Promo Collection Vol. 1,” which included more than 150 music cues.

“We knew nothing about the industry or any of the competitors that were out there,” Mendelsohn said. “(But) no one was filling the niche.”

Within a few months, Megatrax had signed up the major networks and Mendelsohn and Dwyer’s short compositions were popping up on TV promos. Using their contacts from USC, the two contracted aspiring film composers to help them out, and they ramped up CD production to three or four a year. Dwyer’s wife, Paula, provided the artwork for the CD covers.

By 1995, Megatrax moved into the North Hollywood studio space it had once rented by the hour. Since then, the company has grown to 19 employees and a 20,000-square-foot facility with three studios and several offices in the same location.

Revenues have grown from less than $100,000 in 1991 to $4.2 million in 2001. About 90 percent of Megatrax’s revenues come from music licensing and royalties. Renting out studio space to third parties generates additional income.

Recession resistance

Growth comes despite the downturn in commercial production because some advertisers see library music as a cost-effective alternative to licensing hit songs or having original custom music composed.

“Music production is as fickle a business and as transient a business as any other part of the entertainment industry,” said Paul Lehrman, Web editor for the professional audio journal Mix. “People with good business plans and deep pockets can ride out recessions.”

Success in the music production industry often depends on how easily producers can find what they need from a given library. To that end, Megatrax offers clients a CD carrying case with its entire library, a catalog and a CD-ROM search system. Clients can also search for music and audition and license it on the company’s Web site.

Mendelsohn and Dwyer want to turn their company into a one-stop shop for producers. Current services include music searches, custom scoring, music clearance and supervision and sound effects libraries. Early this year, Megatrax plans to begin offering digital downloads from its Web site.

There also are plans to link the site to those of four other music libraries, which would allow producers to search each company’s database at once.

Along with growth comes the increasing problem of piracy. Since Megatrax and other such music production companies license their entire libraries to clients world-wide, it is impossible for them to track whether their material is being properly used. “Anyone can rip off a property,” Mendelsohn said. “We try to track it as much as possible.”

PROFILE:


Megatrax Production Music Inc.

Year Founded: 1991

Core Business: Producing and licensing music for film, television, advertising and multi-media.

Revenues in 2000: $3.6 million

Revenues in 2001: $4.2 million

Employees in 2000: 17

Employees in 2001: 19

Goal: To become a one-stop shop for producers.

Driving Force: Producers’ appetite for easy-to-access music for use in TV shows, movies, and promotional trailers.