Royalties

What are Royalties?

Royalties are a means to pay someone for the right to use their intellectual property or work. There are multiple different types of royalties for music assets and many complexities, with laws and payouts varying from country to country. For independent artists, it can be incredibly challenging to navigate all of this and receive the proper compensation for their work. We help our partners collect all of these varying revenue sources and take care of the administrative side.

With music, there are two distinct copyrights to be aware of;

Underlying musical work (often referred to as the composition)
Sound recording / master recording

Publishing Royalties

Paid out to the associated songwriters/composers of musical work/composition. There are multiple different types of publishing royalties generated in association with the composition.

A key distinction to understand – if you have covered someone else’s song, then the original composers/songwriters of the work you have covered are eligible to collect publishing royalties on your sound recording. Depending on your location, you may also need a license to legally release your cover song.

Our publishing division helps our partners collect all of their digital royalties through our direct partnerships with various overseas and local societies, along with cleaning up data issues that result in songwriters not being paid properly.

Master Recording Royalties

Paid out to the record label/distributor or owner of the master recording, generated by digital streaming/downloads or physical sales.

Neighboring/related rights royalties

Performance Royalties

Performance royalties are a form of royalty that’s non-interactive, and these are usually paid out to the recording artist from digital streaming platforms/services or for physical use such as in shops or music venues.

Mechanical Royalties

Mechanical royalties are generated through the reproduction of copyrighted works in digital and physical formats. Songwriters are paid mechanical royalties per song sold, downloaded, and streamed via “on-demand” streaming services.

The mechanical royalty rate in the United States is regulated via the Copyright Royalty Board (CRB) through a panel of three judges. This rate is set to increase by over 44% over the next few years

Synchronization Royalties

YouTube pays out a micro-sync royalty in the United States, which is only able to be collected by select music publishers who have a direct publishing agreement with YouTube. This synchronization royalty, which commonly goes uncollected, is paid out on music video and sound recording assets – or for videos which are picked up automatically by YouTube’s Content ID system and monetised with a composition or sound recording claim.

Neighboring Rights/Related Rights Royalties