Music Royalties, Distrokid, BMI, Ascap, Songtrust, Soundexchange, Song Royalties In 4 Easy Steps
Music royalties, what are they? How can you understand them? AHHH, it just gets so complicated, but I’m going try to break this down in four easy steps on how to collect all your royalties as a musician.
Step One:
You guys should be doing this already but, if you’re new to the music industry then you’re probably not and that is distribution. Make sure you get your music onto Spotify, Apple Music, etc. These are the outlets that generate these royalties. Without your music out there, no royalties will be generated so make sure your music is out there. There are a lot of distributors. You can do your research on that, the one I use is DistroKid. I personally have used CD Baby and Tunecore also. It all depends on what exactly is your goal, how big your project is and what you expect you will be making in royalties, oh and yes your budget too. DistroKid is my favorite at only 20 bucks a year and if you CLICK HERE you will receive a discount on your first year. So for 20 bucks a year you get to upload unlimited music and you get to keep 100% of the sales and royalties, everything is yours. There are some other good companies but they take commissions and they charge you per album not per year.
Step Two:
Make sure you guys are signed up with a performance rights organization or as we call them a PRO. The main ones are ASCAP, BMI and SESAC. BMI is Free and ASCAP is like $50. Every song you release you want to register it with your PRO. You register with your PRO and they collect royalties for your compositions. Any public royalty that you generate is collected for your compositions through your PRO.
Now, if you didn’t know, there are two types of royalties, you have the composition and the master recording (the sound recording itself). That’s another topic for another day. PRO’s will collect your composition, make sure you sign up for them and then get your songs registered with them before you even release music.
Step Three:
Make sure you sign up with a publishing administrator, or pub admin. A lot of the distributors have these services like CD Baby has CD Baby Pro, Tunecore has administrative services also. You also have separate companies that are only administrators such as SongTrust and Sentric Music. I’m personally with SongTrust so if you would like a discount code, as a memeber I can offer one by Clicking Here. Pub Admins register your songs with other PRO’s worldwide. Your PRO’s (BMI, ASCAP, etc) only collect in the United States. So combine a PRO with an Admin and you get worldwide royalties. So if you guys are looking into SongTrust you may want to sign up for them first and they’ll create the PRO account for you at BMI.
Step Four:
This is mostly for Artists and sound recording owners, and that is Sound Exchange. Sound Exchange collects royalties for your Non-interactive royalties. A good example of this is Pandora or anywhere where you can’t select the song instead you have the option of stations. You are going to generate royalties as the performer of the song and if you’re not signed with a label then you are also collecting the royalties as the master recording owner or sound recording owner of the Song. Producers can also get paid through Sound Exchange, but that’s a agreement between you and the artist. The artist has to contact Sound Exchange and get a letter of direction or LOD, giving them permission to pay you the percentage in which you have agreed to. That’s a whole other topic in itself, like I said I’m just keeping it simple and to the point.
These are four important outlets that will collect the majority of your royalties. There are a lot of other ways to generate royalties as a musician such as YouTube content ID, etc., but to keep it simple this is a great start.
I hope that helped cleared things up a little. Until next time.
