WHAT ARE ROYALTIES & HOW DO I GET THE MONEY?
This is a very large and complex topic and this is just a very basic guide. I have had a lot of questions from bands, songwriters & media composers. This is based on my experience in the UK as a composer, so it may or may not be completely accurate for other parts of the world.
Two Basic Types of Royalty
There are two basic types of royalty that are paid to the composer of a work. (“Work” covers everything that is an original composition of yours from songs to library music and full film scores.)
Performance Royalties
These are based on each performance or broadcast of a performance. As technology advances and new media are invented the definitions become more complex, but traditionally this usually means:
- Live performance at a venue
- Performance broadcast on television or radio (live or recorded)
- Broadcast of a recorded work on CD/vinyl etc.
- Broadcast of a work as a soundtrack or part of a soundtrack to a TV/radio or film programme
Broadcasters must keep a log of what tracks are played on the radio. Film and TV production companies supply a cuesheet showing what music is used in a film or programme. The smaller broadcasters are allowed to just give “samples” of airplay, e.g. one or two days out of a month. No, it isn’t fair very often.
Mechanical Royalties
These are based on the mechanical reproduction of a work, and is payable on each item (CD, vinyl, video, DVD etc) as it is manufactured or sold to the public.
Performance royalties are collected from broadcasters in the UK by the Performing Rights Society (PRS), mechanical royalties are collected from record companies etc. by the Mechanical-Copyright Protection Society (MCPS). These two societies now work together under the umbrella of “The Music Alliance”. All countries in which copyright has any meaning have their own equivalents.
You need to become a member of these societies in order to get paid your royalties. They do, of course, take a commission to pay for administration.
Publishers
Traditionally a publisher is someone who “publishes” your works (via sheetmusic) and actively exploits them (e.g. getting singers or bands to record your songs). These days more often than not a publisher is someone who just collects your royalties and takes a percentage of them. In pop music many publishers are only interested in bands who are signed to a label and recording their own material.
A publishing contract can be for just one song or for all of your work composed during the period of the contract. Typical publisher percentages vary from as much as 50% (hopefully when the publisher really is actively exploiting your work or has given you a substantial advance on your share) to 5-15% for purely collecting your money from the various collection societies round the world.
50% is the maximum publisher share allowed by the PRS., although larger shares or 100% “buyouts” are possible for mechanical royalties.
The various agents who represent media composers normally take 40 to 50% as they are (or should be!) doing a lot of work to get your music used.
PRS pays the publisher’s share direct to the publisher and your share direct to you if you are a member. If you are not then the publisher can collect your share and pass it on to you. (You hope).
Do I Need a Publisher?
If you are a member of PRS and MCPS then theoretically the answer is no. Any performance royalties from around the world will eventually pass from the foreign collection societies to the PRS, however a publisher can often get these more quickly as they have affiliates, branches or agents in all relevant territories who can monitor and collect performance and mechanical royalties directly from the collection societies in that country. Until your works are being played or reproduced mechanically throughout the world you do not need a publisher unless they are exploiting your compositions.
What About Live Performances?
Music venues and events (even quite small ones) have to pay a licence fee to PRS. The manager or promoter can (but often doesn’t) fill out a form which notifies PRS of song titles, composers and publishers. If you are performing your own material, then you can either supply them with the details, or else do this yourself. In very small venues the administration compared with the revenue often appears to make this not worth the bother, but you can now fill out the form online which can be worth doing for a composer/performer. If you play the same set every gig the work involved is less and you may even get a pleasant surprise when your PRS statement comes through even for small gigs. Medium to large venues can pay quite considerably.
Should a Film Production Company Insist I Sign a Publishing Contract?
No, but they often do. However if it means the difference between you getting the commission and not getting the commission, then you probably can’t afford not to until you become very established. This is becoming more common and is often merely a way for the film company to get some of your money. In most cases a small TV production company and/or their affiliate publishing company can not and will not actively exploit your work so so they are really just taking a slice of your pie. They should not be getting more than a 20% share, but often they do. It may be different in the case of a large feature film if your music becomes part of various spinoffs, e.g. soundtrack album, merchandising, games, internet media etc. but even then it is arguable that this is not exploiting your music beyond it’s role in that production.
