This is a bit of a read – but sometimes in the music business it’s about learning. If you think you might not understand as much as you should about your royalties I urge you to bite the bullet and read on.
Today I want to try and clear up some of the confusion surrounding royalties and how to ensure that you are getting credited as much as possible when your music is used in public (think radio play, advertisements, film etc). Part of what always confused me was simply the language around this, so I am going to try and simplify it and explain it in plain English. I should include this caveat – I am NOT an expert at any of this, just someone who has spent some time figuring things out. Hopefully, I can help you save some time I spent.
First – basically, there are essentially 4 main ways that you can receive royalties for music you have created:
1) You get direct royalties for sales of your music. The percentage you get from each sale is negotiated in your contract with the label and they should issue you statements (generally quarterly) showing what has sold and what you are entitled to receive.
2) You are the writer of the music and own the songwriters copyright. You are therefore entitled to Writers royalties. As the writer of the music, you are entitled to royalties when your music is used publicly (again think radio, clubs, pubs, tv, film etc).
3) You are the publisher of the music and own the publishing rights. Publishing basically refers to the right to mechanically re-produce and distribute the music (think CDs, vinyl, DVD, even digital download). NOTE – You don’t have to be the writer of music to be entitled to its publishing royalties. In fact, in many cases when you sign something to a label, you entitle them to all or some of the publishing royalties because they are the ones who will manufacture and distribute your music. Most labels will have set themselves up as a music publisher, so in effect when you sign a contract with them you are giving them rights to publish your music (think make it available to other people). The way the publishing rights will be split between you and the label is specified in your contract, and if it is not, you should ask that it be included. Obvioulsy, if you don’t have your own publishing set up, you won’t be able to negotiate a publishing split with the label when you sign a contract.
Now, let’s cover how to get the most out of #2 and #3. Obviously, the best way is to set YOURSELF up as an official music writer, and ALSO set up your own publishing so that you can negotiate a publishing split with the labels you sign your music too (often 50/50). If you are a label, you SHOULD already have your publishing set up so that you can collect publishing for yourself and your artists who may not have their own publishing.
So how do you get this set up? Well, I’ve set up my writer’s account and publishing account through ASCAP but in the UK you are more likely to use MCPS-PRS. Membership to ASCAP is free, and there is a small fee for joining MCPS-PRS. There a quite a few similar agencies worldwide depending on your country of origin – BMI or SESAC also for the USA, Sacem in France, GEMA in Germany, SISAC international etc. Here’s a link to wikidpedia’s list for various countries .
The important thing is that you actually join one of these. They all have mutual agreements with eachother, so for example a Finnish one might collect some money for you from radio play of your music in Finland but it will pass this to your society, which will then pay you. As stated earlier, you can set yourself up for a writer’s account or a publishers account, or preferably BOTH. Criteria for joining these soceities may slightly differ, but here’s a general guide to see if you are eligible to join (in this case MCPS-PRS). Just visit your society of choice and look on their website. The important thing is, if you don’t join you will not be set up to earn royalties when your music is performed, played or reproduced.
OK, so we’ve discussed how to set yourself up to get royalties for use of your music as a writer or publisher of your music.
4) There’s also one more way to get royalties and this is simply for the public performance of your music (again, bars, clubs and the like). To ensure this happens, you want to set yourself up as a performer member, so that your performances (music) are listed in a large database and linked to you. As a performer (artist), this simply means signing up for FREE with PPL.
It’s up to labels to submit all of their material to PPL so that it’s listed in the database – so they and the artists can get royalties for public performance of the music. Each time, for example, your music is played on the radio, you are entitled to royalties for public performance. Radio stations have to follow a strict protocol of submitting playlists so that you are compensated for radio play. If you are a LABEL and you have not submitted your catalogue with associated artist information, you are doing yourself and the artists a disservice. Get paid! In most cases, it’s not going to be a lot of money, but combined with writers royalties and publishing royalties, as your catalog grows as an artist or label, you are going to see increasing returns. Hey every little bit helps.
I hope some of you find this useful and begin the process of getting yourself set up. It may seem like a little more office work than your artistic side wants to stomach, but once you have it set up you are a big step forward in terms of laying the foundations for a more lucrative and professional creative career.
Next time – ISRC codes.