Music royalties explained: how to get paid for every play
By Matt Mateus
Posted in Guides
If you’re releasing music, you’re already earning royalties, probably more than you realize. The problem is that many artists only collect from one or two sources and leave the rest unclaimed.
Every time your music is streamed, performed, or broadcast, it earns money. But not all royalties come from the same place, and knowing how each one works can be the difference between getting paid a little and getting paid fully.
Here’s a clear look at each type of royalty, what it covers, and how to register so nothing slips through the cracks.
Quick answer
There are four main ways to earn royalties from your music:
Recording royalties – paid for your sound recording (the master).
Performance royalties – paid for the public performance of your song.
Mechanical royalties – paid for the reproduction of your song (streaming, downloads, or physical copies).
Neighboring rights – paid for public plays or broadcasts of your recording (radio, TV, or retail spaces).
It’s important to register with each one that applies to you so you don’t miss out on any income.
1. Recording royalties
Recording royalties come from the use of your sound recording. Whenever your track is streamed, downloaded, or sold, you earn money for the recording itself.
If you release independently, your distributor collects this and sends it to you. If you’re signed, your label collects and pays your share.
Examples:
- A fan streams your track on Spotify or Apple Music.
- Someone buys your album on Bandcamp or iTunes.
- You sell vinyl or CDs at a show.
In each of these, the recording earns money, and the distributor (or label) sends the payment.
Who gets paid:
- The artist, band, or label that owns the master recording
How to get paid:
- Use a distributor such as DistroKid, CD Baby, TuneCore, or United Masters
- Set correct splits if you have bandmates or collaborators
2. Performance royalties
Performance royalties are paid when your songwriting is publicly performed. That includes radio, television, live shows, or streaming.
These are collected by Performance Rights Organizations (PROs) like BMI, ASCAP, or SESAC, which license songs to broadcasters and venues and then pay songwriters and publishers.
If you’re deciding which PRO to join, check out this guide comparing SESAC, ASCAP, and BMI, including how each one works.
Examples:
- A bar or coffee shop plays your song on their playlist.
- A college radio station spins your track.
- You perform your song live at a venue.
- Your track streams on Spotify, which also counts as a public performance.
Who gets paid:
- Songwriters and publishers
How to get paid:
- Join a PRO such as BMI, ASCAP, or SESAC
- Register your songs
- Submit your live setlists to earn performance royalties for your shows
3. Mechanical royalties
Mechanical royalties pay songwriters for the reproduction of their compositions—every time a song is copied, downloaded, streamed, or pressed to vinyl.
They’re called “mechanical” because, historically, they came from physically manufacturing records. Today, they mostly come from digital streaming and downloads.
In the U.S., these are collected by the Mechanical Licensing Collective (MLC).
Examples:
- A listener streams your song on Spotify (it counts as both a performance and a reproduction).
- Someone downloads your track from iTunes.
- A label presses your song to vinyl.
Who gets paid:
- Songwriters and publishers
How to get paid:
- Register at themlc.com
- Add your songs with accurate metadata
- Link your PRO if you have one
- Check the MLC Public Works Database for unclaimed royalties
Neighboring rights
Neighboring rights pay performers and recording owners when their recordings are publicly played or broadcast. They’re sometimes called performers’ rights because they cover the people on the recording, not the writers of the song.
These royalties are often missed, but they can add up fast, especially if your music gets radio or TV play.
In the U.S., neighboring rights come from digital radio platforms like SiriusXM and Pandora and are collected by SoundExchange.
Outside the U.S., they also cover FM radio, TV, and retail plays. These are managed by CMOs such as PPL (UK), GVL (Germany), or SENA (Netherlands).
Examples:
- Your track plays on SiriusXM or Pandora.
- A radio station in another country plays your song.
- Your music is used on TV or in a retail store overseas.
Who gets paid:
- Featured and session performers
- Recording owners (labels or independent artists who own their masters)
How to get paid:
- In the U.S., register with SoundExchange.
- For international royalties, use a neighboring rights agent like the NRG Agency. They can register you with multiple CMOs worldwide and collect your royalties for you.
Even if you already collect from your distributor and PRO, neighboring rights cover a completely different set of uses, mainly broadcast and public performances of your recordings.
How these fit together
Each type of royalty covers a different use of your song or recording.
Type | Who Gets Paid | What It Covers | Example |
Recording royalties | Artists or Labels | The sound recording (master) | Streams or sales |
Performance royalties | Songwriters or Publishers | The public performance of the composition | Live shows, radio, streaming |
Mechanical royalties | Songwriters or Publishers | The reproduction of the composition | Streams, downloads, vinyl |
Neighboring rights | Performers or Recording Owners | Broadcast and public use of the recording | Radio, TV, retail, digital radio |
How to make sure you’re collecting everything
If you own both the recording and the songwriting, you can collect from all four sources:
- Distributor – recording royalties
- PRO – performance royalties
- MLC – mechanical royalties
- SoundExchange or other CMOs – neighboring rights
Once you’re registered with each, you’ll be covered for nearly every major royalty stream generated by your music.
FAQ
Do I need a publisher to collect mechanical royalties?
No. You can register directly with the MLC as a self-administered songwriter and get paid directly.
Can I collect neighboring rights if I already use SoundExchange?
Yes. SoundExchange covers digital radio in the U.S. only. For international airplay, register with foreign CMOs or a neighboring rights admin service.
Do performance and mechanical royalties overlap?
Yes. Streaming generates both because it counts as a performance and a reproduction.
What if I only perform but don’t write songs?
You can still collect recording and neighboring rights royalties for your performances. The songwriting royalties go to the writers.
What about YouTube or TikTok?
Those fall under your distributor’s payouts. They handle licensing and include that income as part of your recording royalties.
