Mechanical royalties have been around almost as long as recorded music itself, dating back to when the industry was reproducing songs on player-piano rolls. We’ve come a long way from those days, and in today’s digital age, streaming platforms reign supreme.
Understanding Ownership
Before we get into the nitty-gritty of royalties, it’s important to remember how a song is split into two halves: the composition and the master recording. The composition, or publishing, side refers to the lyrics and underlying melody within a piece of music. The master refers to a specific recording of the song.
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While songwriters typically control their composition rights until they sign an agreement with a publisher, master recording rights are often partially or fully owned by their label or distributor.
Publishing is divided further into performance royalties and mechanical royalties. Unlike performance royalties — which generate both a writer and publisher share — mechanical royalties only generate the latter, an important detail that’s described in-depth here.
How Do I Earn “Mechanicals”?
While the term “mechanical royalties” dates back to the early 20th century, it’s evolved quite a bit over the years and now refers to when your music is reproduced and sold through either physical editions or digital files. This means you earn them whether your label just sold a batch of limited vinyl LPs or you just racked up millions of streams on leading platforms like Apple Music and Spotify.
Other oft-overlooked ways you can earn mechanical royalties include ringtones/ringbacks, cover song/karaoke recordings, film soundtracks, and interactive greeting cards.
What Are The Rates For “Mechanicals”?
Mechanical license royalty rates were first established by the Copyright Royalty Tribunal as part of the Copyright Act of 1976. The current statutory rate for physical or download mechanical royalties is 12.4 cents for recordings less than five minutes long and 2.39 cents per minute for songs longer than five minutes. Streaming royalty rates are based on the overall revenue a particular service brings in and how much of that they are legally required to share with songwriters.
However, these rates change often and are determined by a number of factors within the digital streaming platforms themselves. Information Is Beautiful has a helpful infographic exploring the relationship between rates and web traffic here.
Rest assured that if you have your songs distributed to many streaming platforms and you’re effectively marketing your music to earn more streams, you have money coming your way through mechanical royalties.
Who Collects These Royalties For Me?
Artists should be aware that earning royalties is only one step in the monetization process. Actually getting paid is another. Good record-keeping is essential. If you don’t know where your music is being used and played, it will be difficult to know whether you are collecting everything you earned.
Collecting global royalties can also be challenging. It’s nearly impossible for a creator to register their music with every collection society around the world. Utilizing a publishing administrator like Songtrust is the most efficient method of monitoring, managing, and collecting these funds all over the world. We’ll register your songs with mechanical organizations (and other publishing royalty sources) in the U.S. and internationally, and track your funds down, leaving you more time for the art of actually making music.
Join Songtrust to make the most of your mechanical and performance royalties globally.
