How Do Royalties Work?
Royalties work differently than the upfront license fee. Royalties are payed for the public performance of music, either live or as a sound recording. This includes music on television, radio, internet, concert halls, clubs, stores, elevators, and more. The royalties rates vary and depend on the type of use of the music.
Artists obviously don’t want to spend their time chasing royalty payments and monitoring all different medias for the use of their music. That’s why they grant the right of collecting their royalties to Performing Rights Organizations (PRO), such as ASCAP, BMI, SESAC and SoundExchange. The PROs monitor all the different public music outlets and collect money for the use of the music. Afterward they distribute the money among their members.
Become a Member
Let’s say you wrote a song and managed to get it placed on the CBS show Survivor. The first thing you want to do is become a member of one of the PROs, it’s recommended to do that ahead of time. Becoming a member is free, but it will take a while to process the paperwork. You can join the PRO as a writer, publisher, or both. These are two different entities, so you’ll have to fill out two different applications.
Register Your Work
Lets assume you are already a member of one of the PROs as a writer and a publisher. You are the sole owner of the song you licensed, you own the publishing and writing rights and you also own the master. As the owner of these rights you will register the song with your PRO organization. This is very easy to do, and again doesn’t cost money.
The music supervisor of Survivor is required to fill out a cue sheet and submit it to the PROs. A cue sheet is a detailed description of the use of music on the show. Even a short 2 second cue has to be listed. Your song will be added to the cue sheet of the show. Every time the episode with your song is aired you will earn royalties. The amount which you will earn on TV royalties depends on the length of the song, and the type of use of the song in the show. For example, a theme for the show will earn you much more than background music for a short scene.
Every quarter your PRO will send you a statement about the performance of your music, and hopefully a nice check.
Collecting The Checks
Back to our example, a year went by and the show Survivor was aired in many parts of the world. You can expect to receive royalties on that as well, though it can take a year or even more for it to process. 10 years has passed, the show has had many reruns and you keep collecting checks. This is a great way of making money off your music, and of course, great exposure for your music.
- Become a member of one of the PROs
- Register your work with your PRO
- Open your mail, it might be a royalty check
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