Emily Clarke

How Do Music Royalties Work?

Working as a composer or musician can be a fun way to use your talents to make a good living while giving the gift of music to others. Although most people only think of famous rock, pop and hip-hop stars when they think of big money in the music business, the truth is that virtually all professional recording artists get paid fairly well.

Even if you don't have a smash hit on your hands, you still get paid royalties for published music. Of course, how much you get paid depends on how popular your music is, but receiving royalties can mean a steady stream of income from your music for years or even decades to come.

The Standard Arrangement

Although there are several different ways to get paid as a musician, the standard arrangement (no pun intended) is for the publisher of a piece of music to issue royalty payments for each use or sale of a song or album. This means that each time your song gets played on the radio, TV, in a movie, on a commercial, on YouTube or elsewhere, you and the other people involved in creating the recording receive a payment. This payment is known as a royalty.

Music royalties payouts are usually issued once per quarter. To track when and where licensed music was used to determine music royalties payouts, groups like the American Society of Composers, Authors and Publishers (ASCAP) and BMI track royalties and pay them out for publishers.

Entities that use music, including radio stations and sports venues, register with these groups and log when a piece of music is played. This is the information that helps ASCAP and BMI to determine how much to pay each artist and associated personnel responsible for creating a song.

How Much Do Artists Make From Royalties?

The amount each artist receives in royalties for albums sold can vary, but for many, the standard is between 10% and 20% of the total album price. With streaming services, the amount paid per stream is often lower, sometimes closer to a few cents per stream. The actual dollar amount an artist receives from royalties depends on the contract they have with the publisher and how often the artist's music is played or purchased.

Author Resource:-

Emily Clarke writes about multiple payment platforms, payouts API, marketplace payouts and more. You can find her thoughts at API services blog.