Royalties: What They Are & How To Collect Them

Congratulations! You’ve made the first step towards true artistic independence – understanding your cash flow. In this article, we’ll give you an overview of the different royalty types and the steps that you will need to take to collect them after you have written/produced your hit song!

What are royalties?

Royalties are payments that go to publishers, recording artists, songwriters, producers and any owners of a copyright in exchange for the right to use the intellectual property (IP). There are two main types of royalties, these include: Performance Royalties and Mechanical Royalties. [1]

Performance Royalties

These are royalties paid to the copyright owner (songwriter, producer, artist, etc) whenever music is played publicly. Performance royalties cover music played in a restaurant, bar, over the radio and on streaming services! [2]

Mechanical Royalties

Mechanical royalties are paid to copyright holders when music is licensed (think tangible products like CD or Vinyl) as well as when music is streamed on-demand.

Collecting your mula!

Okay, first thing first, sign up with a Performance Rights Organization (PRO). Here’s a list (not all at all!) of some the PROs around the world:

  • ASCAP (USA)
  • BMI (USA)
  • SESAC (USA)
  • SOCAN (Canada)
  • PRS (UK)
  • COSCAP (Barbados)

Now, you’re ready to collect your performance royalties! It’s as easy as that. Collecting your mechanical royalties is a bit trickier – as they’re typically paid directly to the publisher. However, registering your songs with the Harry Fox Agency will get you paid!

Hope this quick article helped in knowing what are the first steps you should take regarding collecting your royalties as a musician!

Sources

[1] Music Royalties Guide

[2]What Are Performance Royalties? (And How They’re Different From Mechanical Royalties)