Types of Music Royalties

Types of Music Royalties

When it comes to royalties the recording artist, record company, writer and publisher are all entitled to a slice of the pie whenever their song is played, used or bought by an end user (like me or you buying a CD).

Because a song can be played, used or bought in many different ways, this simple concept gets more complex in its real world application.   Everything from radio, live performances, advertisements, downloads, right through to sheet music may attract a royalty payment.  

So what types of royalties are available?

Mechanical Royalties
These types of royalties are paid to the artist, songwriter and publisher based on the sale of recordings that are reproduced on different types of media such as CDs; tape; ringtones; download tracks; musical toys; DVD; VHS or computer games.

Performance royalties
When a song or composition is played or performed either live on stage, recorded, broadcast or via web transmission, a royalty is owed to the songwriter and publisher.  Royalty payments are also owed if music is played in music cafes, karaoke jukeboxes and television advertisements. Users of music will need to obtain a performing right license from a music society such as APRA, which the composer, publisher and performer have subscribed to.

Print rights
These are royalties paid based on sales of printed sheet music or downloading of lyrics. 

Digital rights
The performer and songwriter are entitled to be paid royalties for music used on the internet or by wireless technologies (mobiles). These include webcasting, streaming, and downloading of music.

Synchronisation royalties 
These types of royalties are paid to the artist when a song is used and adapted into a visual format.  Musical scores can be adapted and used in film, television advertisements, videos or live theatre.  Synch exposure can provide a much needed boost to an artist’s income and profile.  

Foreign publishing royalties
These royalties are paid to the artists when their music is licensed and published outside of Australia.  For example, if Brazil wished to license the rights to play ‘Land Down Under,’ at the Australia v Spain World Cup final (dare to dream!).  

Question? entertainment@mccormicks.com.au 

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