One of the most important concepts in music publishing is how each recorded song has two unique copyrights, or two “halves.” Knowing how these halves co-exist is essential to understanding the unique royalties each side earns for the use of your song.
The Composition and the Recording
Before we dive in, let’s be clear on what we mean by “copyright.” As we’ve written before, a copyright is a bundle of rights granted to an author of an original creative work that has been fixed in a tangible medium, whether it’s written out or recorded in demo form.
Every song is divided into the composition and the recording. The composition is the original idea of the song put in some tangible form. It could be a simple recording you make with your smartphone, or the lyrics and chords of the song written out on paper.
Once you’ve captured or recorded a song — whether on paper or in an audio file — you are considered its rightsholder by default. There are quite a few reasons to register your song with your home copyright office, however. Our Copyright 101 primer has more.
The other type of copyright every song has is the recording. It refers to a specific recording of a song for release. While there can only be one composition, a song can have multiple recordings (e.g., live versions, alternate takes, or covers of your song by other artists) and grant you multiple recording copyrights.
How Each Copyright Earns You Royalties
You’re probably wondering how these two kinds of copyrights generate money from your work. Well, it depends on which copyright you hold.
As the originator of a song, songwriters and their publishers generally hold performance and mechanical publishing rights, referred to collectively as “publishing” or “composition” royalties. Mechanical royalties are generated whenever your song is reproduced in any form, whether it’s a physical format like a CD or LP, a digital download, or an on-demand stream (e.g., Apple Music or Spotify).
Performance royalties are generated anytime your song is performed publicly, including live shows, radio broadcasts, and speakers at a restaurant or retail store. On-demand streaming earns performance and mechanical royalties, as it’s considered both a performance and a reproduction. Performance royalties are collected and paid out by your Performing Rights Organization (PRO) or Collective Management Organization (CMO).
Whoever controls the recording — whether it’s a recording artist self-releasing their work or a proper label — contracts a distributor to get the music into digital stores and services - as well as to collect recording side royalties for streaming and digital downloads. Artists and labels will also be paid for physical copies sold, whether it’s directly through their website, on tour at a merch table, or via a distributor who sells and ships physical copies to retailers.
Another oft-misunderstood royalty is owed to recording rights owners: digital performance royalties (similar to neighbouring rights outside of the U.S.). These royalties are paid to the recording owner and recording artist (not the publisher or songwriter), and are earned whenever it is played on a non-interactive streaming service like Pandora, or streaming or satellite radio. In the U.S., these royalties are collected by SoundExchange; outside of the U.S., many organizations collect and distribute neighbouring rights royalties.
So, now that you know what kind of royalties each kind of copyright grants you, it should be easy to collect them, right?
How to Maximize Your Earnings
While the process itself is quite simple, ensuring you’re covered for global royalty collection becomes more complex when you take on all the administrative responsibilities yourself. Even though you may be legally entitled to all the royalties associated with a given type of copyright, there is still a process that you must follow in order to have your royalties linked to you and your songs.
Unfortunately, due to a lack of knowledge or misunderstanding about the publishing timeline — as well as the difficulty in global registration — it’s not uncommon for these royalties to go uncollected. Ultimately, many songwriters miss out on a lot of long-term revenue.
That’s one of the main reasons we created Songtrust: to help songwriters and creators access all the royalties they’re owed. Our publishing administration service is built upon low fees, transparent and flexible terms, and most of all, the idea that independent songwriters should be empowered to take control of their musical career.
If you have any questions about music publishing or Songtrust, feel free to contact our team anytime.