how to easily collect and split royalties?
How to easily collect and split royalties? When you release a song, you and the producer are both songwriters on the song. This is referred to as a “split.”
A young rapper named “Desiigner” launched a massive hit song called “Panda” in December of 2015, which went to #1 on the Billboard charts the following year. And when it was revealed that Desiigner only paid $200 for the exclusive rights to the beat to “Panda” from an up-and-coming producer named “Menace,” the internet went berserk.
There were a lot of mixed feelings about “Menace.” Some mocked him, while others felt terrible for him, believing he had been royally screwed over for receiving only $200 for a song that was producing millions of dollars!
But here’s the thing: most people don’t get it. Menace was not cheated in any way; in fact, his wildest desires had just come true! And that’s because, whether you’re leasing a beat or purchasing exclusive rights to a beat, you don’t own the beat when you buy it online. You don’t even have a smidgeon of control over the beat. As long as the instrumental does not contain samples from other songs, the producer retains complete ownership.
When you buy a beat online, you’re paying for the right to utilize the beat within the contact’s agreed-upon guidelines for that specific instrumental. But that’s only the first step. You still need to collect and split royalties.
OWNERSHIP AND LICENSES
The only significant distinction between licenses and exclusive rights is that with exclusive rights, the producer commits not to license the beat to any other artists after you. But here’s the deal: any artists who licensed the beat before you who bought exclusive rights can still use it as long as they follow the terms of their licensing arrangement.
You don’t own 100% of the song when you write lyrics over an instrumental. When you compose lyrics over the instrumental you bought, you’re automatically forging a relationship with the song’s producer. That’s because you and the producer are both songwriters on the song and jointly control half of it. You own all of the lyrics you authored, and the producer owns all of the music they created. This is referred to as a “split.” This information is included into a “split sheet,” which is how everyone who contributes to the writing of a song is paid their appropriate portion of royalties.
WHAT TYPES OF ROYALTIES CAN YOU COLLECT?
To collect and split royalties, you’ll need to know which kind of royalties you are owed in the first place.
#1 Performance Royalties: Music playing in a bar, club, airport, or grocery store, you singing your music live, or someone performing a cover of your song live are all examples of performance royalties. Also, if your song is featured in a film, commercial, TV show, video game, or other media.
#2 Mechanical Royalties: A digital download, copies such as CDs and Vinyl, and streams are all examples of mechanical royalties.
#3 Micro Sync: Earnings from music utilized in YouTube videos, social media posts, podcasts, and other similar media.
So, just as you had to pay the producer for permission to use their beat, people will have to pay you and the producer for permission to use your song once you’ve created one using that beat.
WHERE CAN YOU REGISTER YOUR SONG?
You’ll also need to register your song in four different places to ensure that you get paid for all of the royalties you’re owed. If you fail to do so, any unclaimed royalties will be considered “Black Box Royalties” and handed to the top market share artists, such as Drake and Beyonce, after 2-3 years. Every year, billions of dollars in unclaimed royalties are dubbed as “Black Box Royalties.” When you collect and split royalties, don’t leave any money on the table!
- MUSIC DISTRIBUTORS
You should first register your music with a music distributor such as DistroKid. You can get all of your songs on all of the big platforms, including Spotify and Apple Music, with the help of a firm like DistroKid. DistroKid also includes a feature called “splits” that allows you to enter all of the split sheet information so that everyone who wrote the song receives their fair amount of earnings. And DistroKid will collect your Mechanical Royalties for digital streams and sales from all of the main platforms, then divide the money according to the percentages you specified on the split sheet.
- PERFORMING RIGHTS ORGANIZATIONS
Become a member of a Performing Rights Organization (PRO) in your country. BMI, ASCAP, and SESAC are the most well-known in the United States. If you’re not in the United States, look up “collecting society for (your country)” on Google. Some of your Performance Royalties will be collected by the collection society you choose.
- SOUND EXCHANGE
Register your music with Sound Exchange, which keeps track of Digital Performance Royalties for non-interactive mediums such as Spotify radio, Apple Music 1, and other digital radio stations. To put it another way, they are outlets where the user has no control over the music playing.
Whenever you put out a song, everyone gets a part of the royalties. That’s the split. The percentages are subject to change, because everything can always be negotiated when it comes to contracts. So if you want to collect and split royalties, splitting isn’t hard. The usual split is that 50% goes toward the person or people who made the instrumental and 50% towards the person of people who made the topline, wrote the lyrics and “sang” over them. The biggest issue when you’re starting out is to register everywhere to collect as much of those royalties as you are owed. However, once that’s done, you’re set for life.