Terms
SONGWRITER (AKA MUSIC PUBLISHING) INCOME STREAMS
In today’s world your songs can generate money and royalties via the traditional “Physical/Analog” music industry or the new “Digital” music industry. There are in fact a minimum of 13 different and specific ways that you as a songwriter can make money off of your songs. Note – each income stream and type of royalty is generated from both the original recording of a song (i.e. the Beatles’ version of Paul McCartney’s song “Yesterday”) or off of a cover of the song (i.e. if multiple artists cover the song, the song becomes an “x” factor multiplier for revenue and royalties). In the case of “Yesterday,” there are over 25,000 covers, and each version of the song can generate money for the songwriter in many different ways. Below, these royalty and income types are broken out into two categories:
• Physical/Analog Songwriter Royalties and Revenue • Digital Songwriter Royalties and Revenue
Simply stated, these are most of the different ways you make money as a songwriter.
PHYSICAL/ANALOG SONGWRITER ROYALTIES AND REVENUE
INCOME TYPE: MECHANICAL ROYALTIES
description:
A royalty generated from the “Reproduction” copyright. This royalty is owed to the songwriter for each and every unit sold and/or manufactured for physical product – i.e.: LP, CD, cassette, USB stick, etc.
who/what generates and pays this royalty:
Record companies or any other entity manufacturing a physical product (i.e. Victoria’s Secret, The Gap, W Hotel, Putamayo, etc.) that contains a songwriter’s song on it (either his/her own recording of the song or someone else’s cover of that song).
amount owed to the songwriter:
• In the United States: $0.091 per reproduction of a song. If it’s over five minutes, a formula rate kicks in. The U.S. Government sets the rate. • Outside of the United States: There is no government-mandated rate, however, the royalty rate is typically 8% - 10% of the list price (varies by country).
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In today’s world your songs can generate money and royalties via the traditional “Physical/Analog” music industry or the new “Digital” music industry. There are in fact a minimum of 13 different and specific ways that you as a songwriter can make money off of your songs. Note – each income stream and type of royalty is generated from both the original recording of a song (i.e. the Beatles’ version of Paul McCartney’s song “Yesterday”) or off of a cover of the song (i.e. if multiple artists cover the song, the song becomes an “x” factor multiplier for revenue and royalties). In the case of “Yesterday,” there are over 25,000 covers, and each version of the song can generate money for the songwriter in many different ways. Below, these royalty and income types are broken out into two categories:
• Physical/Analog Songwriter Royalties and Revenue • Digital Songwriter Royalties and Revenue
Simply stated, these are most of the different ways you make money as a songwriter.
PHYSICAL/ANALOG SONGWRITER ROYALTIES AND REVENUE
INCOME TYPE: MECHANICAL ROYALTIES
description:
A royalty generated from the “Reproduction” copyright. This royalty is owed to the songwriter for each and every unit sold and/or manufactured for physical product – i.e.: LP, CD, cassette, USB stick, etc.
who/what generates and pays this royalty:
Record companies or any other entity manufacturing a physical product (i.e. Victoria’s Secret, The Gap, W Hotel, Putamayo, etc.) that contains a songwriter’s song on it (either his/her own recording of the song or someone else’s cover of that song).
amount owed to the songwriter:
• In the United States: $0.091 per reproduction of a song. If it’s over five minutes, a formula rate kicks in. The U.S. Government sets the rate. • Outside of the United States: There is no government-mandated rate, however, the royalty rate is typically 8% - 10% of the list price (varies by country).
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