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Earning Royalties For Your Music

What the heck are they, anyway?

· Music Business

This article is an excerpt from How To Get Started As A Singer-Songwriter, which is available on Amazon (paperback and Kindle).

What are royalties?

Royalties are fees that are paid to the composer (that’s you!) every time a song is played anywhere: radio, live venues, TV, satellite radio, internet radio, streaming services, etc.

In most cases, royalties only go to the writer of the song, not the artist or performers. The exception is the category of non-interactive digital transmissions (aka satellite and internet radio), which also gives royalties to featured artists.

Performing Rights Organizations

There are three main Performing Rights Organizations. Basically, the government has granted these companies the right to collect royalties on behalf of performers. Venues, radio stations, TV shows, and anywhere that profits from music has to pay fees to these organizations.

ASCAP and BMI, and SESAC are the three P.R.O.s in the U.S.

I’d suggest doing a little a little research before joining one, because you can only be a member of one.

Songwriter vs. Publisher

Royalties are split 50/50 between the songwriter and the publisher. There’s no way around it, that’s just the way it’s done. But guess what? If you don’t have a deal with a publishing company, you are your own publisher. So you need to set up both a songwriter account and a publisher account with your P.R.O. If you don’t register as your own publisher, you’ll be missing out on 50% of the royalties.

For ASCAP, there is a one-time fee of $50 to set up a songwriter account and $50 to set up a publisher account.

For BMI, there’s no fee to set up an account as a songwriter, but it costs $150 to set up a publisher account.

Getting paid royalties for gigs

Did you know you can get royalties from your P.R.O. for performing live show at almost any venue? You may not realize this, but every venue that provides live music has to pay licensing fees to the P.R.O.s. (Some of them try to get around it by demanding that their musicians play only originals.)

 

All you need to do is submit the set list/venue after your shows, and you’ll get paid in your next royalty check!

Sound Exchange

Sound Exchange is completely separate from the main P.R.O.s (aka you should join one of the three AND Sound Exchange). It collects royalties for satellite and internet radio. So if you get your music on Pandora or any other internet radio station, you’ll get paid for each stream of your song through Sound Exchange.

There are no fees to join.

Publishing administration

You may have noticed both CD Baby and Tunecore offer publishing administration for an additional fee/percentage of royalties. They are essentially offering to collect your royalties for you. BUT if you’re smart, you’ll know that you can do this yourself through your P.R.O.

 

Publishing administration CAN help you get additional international royalties that the P.R.O.s don’t collect for you, but that amount is going to be minuscule for most indie artists, and not worth the fee.

 

So if you haven't already, go join a P.R.O.! You could be missing out on additional revenue you didn't even know what was there.

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