One of the most important part of your music journey is your music publishing.This is something that “BIG INDUSTRY” people don’t want to discuss with you. Did you know, when your music is played on the radio, sold on CD, performed live or streamed online you could be earning music royalties? For most musicians, royalty collection is something they know very little about, they miss out on a great deal of additional income.
Royalties are something you earn on top of your usual up-front fees for selling beats, percentages from album sales, YouTube advertising income or whatever you are currently using to monetize your music. However, in order to earn royalties, you need to understand how they work.
Within the music industry there are two main types of royalties: Performance and Mechanical royalties.
• Performance royalties are those that cover a song’s broadcasting. Mostly they include music played in public. These royalties are only collectible for a song’s public performance and not the song’s written material. Common uses include artist performances in a bar, club, concert or other venue and TV and radio play.
• Mechanical royalties are owed each time a written song is made to be sold in CDs, streamed through online services such as YouTube and Spotify and downloaded on digital retail sites. When a song is performed live, broadcast or recorded, fees are paid, and these fees are what go to the songwriters and performers i.e. you! Whether it’s a beat or a vocal track doesn’t matter.
Royalty Collection Societies
In order to be paid royalty fees, it is necessary to sign up to a performance rights organization (PRO) and register your music with them. Note that with the exception of SoundExchange, you can only sign up to one PRO. There are various collection societies for music royalties worldwide. They all follow very similar principles, with little modifications according to the country that they govern. You may wish to sign up to a PRO in your local country, yet many of the big PROs also accept international artists.
In the United States, the biggest PROs are:
• ASCAP (American Society of Composers, Authors and Publishers) They collect licensing fees on behalf of music publishers, songwriters and composers and give them out as royalties.
• BMI (Broadcast Music Inc.)
They collect licensing fees on behalf of music publishers, songwriters and composers and give them out as royalties.
• SESAC (Society of European Stage Authors and Composers)
They deal with all aspects – administration, creation and licensing – of the music business. They don’t offer open membership; members must be approved before they can join.
• SoundExchange In contrast to the three previously mentioned, SoundExchange is an independent company that solely deals with digital performances. They take payments given by service providers like SiriusXM, Pandora and other webcasters for streaming musical content. You can sign up to SoundExchange in addition to your main PRO, if it does not have a system currently in place to collect digital royalties for you.
These royalty collection societies are all established to assist musicians in getting the royalties entitled to them. However, for most members they will not actively track down uses of your music, it will be up to you to register and notify them of any usage or performance.
Registration & Notification Process
It is highly recommended for musicians to register and claim their royalties. If you don’t take advantage of this option, the money will be divided up and given instead to publishing houses and major labels. Musicians can’t be paid until they join and submit their songs. Often registration will require a photo ID and address details for confirmation on where the royalties will be sent, as well as a small registration fee. Subsequently, you can’t get paid royalties unless your song is registered, however you can claim back royalties from performances and broadcasts in the past, usually for a period of at least 2 years. So, if you’ve been performing and selling music without being registered with a performance rights organization, don’t miss out and register!! You can often speed up the process of collecting royalties by ensuring venues you perform at submit accurate cue sheets with your registered artist name on them to royalty collection societies. If you are selling beats, make sure to inform your purchasers (through your sales contract or otherwise) to include your information when registering songs for distribution. Similarly, before licensing music to TV, websites or video games be sure to hash out all the royalty details. Note that if a song has two or more writers (that’s co-producers for you beat makers), there’s no need to have them all register, as long as all
shares are given by the submitter when registering the music with his PRO.
It’s not hard for musicians to complete the process of registering with a performance rights organization. A few hours of your day could buy you a life time of automated royalty checks. So do your musical career a favor and get on top of those royalties!