All the revenue streams for musicians

Two copyrights in a song
Songwriters
Publishers
Sound recording
copyright owner
Recording artist
notes and lyrics make up
a musical composition
sound recording
is a recorded performance
of a musical composition
Background
musicians
and singers

In most cases,
composition royalties
are separate and distinct from
sound recording royalties.

Even if you are both
the songwriter and the
recording artist,
you need to think about
these roles separately.

Based on the contours of copyright
law and business practice, this list
includes all the possible ways that
US-based musicians can make
money off their compositions,
sound recordings, performances,
brand, or knowledge of their craft.

42 Revenue Streams Revenue Streams: Existing, Expanded, New
money.futureofmusic.org/40-revenue-streams/ money.futureofmusic.org/revenue-streams-existing-expanded-new/

Compositions/being a composer
1. Publishing advance
2. Mechanical royalties
3. Commissions
4. Public performance royalties
5. Streaming mechanical royalties
6. Composing original works for
broadcast
7. Synch licenses
8. Sheet music licensing/sales
9. Lyric display
10. Ringtones
11. Songwriter awards programs
12. Publisher settlements
money.futureofmusic.org/40-revenue-streams/
C

1. Publishing advance
The rate: No standard rate
What it’s for: Advance on publishing earnings, as part of
a publishing deal
Who pays it: Publishing company
Who gets the money: Songwriter/composer
C

2. Mechanical royalties
The rate: 9.1¢ per manufactured track
What it’s for: Reproductions of recordings of your songs/
compositions – either physical or digital
Who pays it: Record labels, publishers or aggregators
Who gets the money: Songwriters/composers
C

3. Commissions
What it’s for: Payment for creating an original musical
composition
Who pays it: Ensemble, presenter, orchestra, dance
company or other entity
C

4. Public performance royalties
The rate: Varies according to performance/venue/
licensee
What it’s for: Generated when your songs are played
publicly on radio, TV, in clubs and restaurants
Who pays it: Broadcasters, venues, TV networks,
restaurants, webcasters, streaming music services
Who gets the money: Collected by ASCAP, BMI and
SESAC and split 50/50 between publisher and composer
C

5. Streaming mechanical royalty
The rate: 10.5% of revenue minus payments to PROs
What it’s for: Revenue generated when your
compositions are streamed on on-demand services
(Rhapsody, Spotify, Rdio)
Who pays it: Service pays publisher or mechanical
licensing agent
Who gets the money: Composer and publisher
C

6. Composing original works
for broadcast
What it’s for: Typically a commercial request to compose
an original jingle, soundtrack, score, or other musical
work
Who pays it: Film producer, TV or cable show, ad agency
C

7. Synch licenses
What it’s for: Typically licensing an existing work for use
in a movie, documentary, TV, video games, internet or a
commercial
Who pays it: Movie studio, ad agency, game company, etc.
Who gets the money: Songwriters/composers and
publishers share publishing money. (Recording artists and
labels get a separate fee for master use of sound recording)
C

8. Sheet music licenses or sales
What it’s for: Sale or licensed use of sheet music
Who pays it: Ensembles, schools, students, musicians.
Sometimes your fans if you’re selling sheet music directly
Who gets the money: Composer, sometimes via
publisher
C

9. Lyric display
The rate: A fee for term, or percent of gross revenue from
site (subscriptions or advertising revenue).
What it’s for: Revenue generated by the licensed display
of song lyrics.
Who pays it: Online lyric sites pay publishers.
publisher
C

10. Ringtones
What it’s for: Generated from licensing your songs/
compositions for use as ringtones
Who pays it: Sprint, Verizon, AT&T, etc.
publisher, label or Harry Fox
C

11. Songwriter awards programs
The rate: $100 and up
What it’s for: Awarded to writer members of any genre
whose performances are primarily in venues outside of
broadcast media
Who pays it: Both ASCAP and BMI Foundation have
programs
Who is eligible to apply: Composers/songwriters who
earn less than $25,000 in annual domestic performance
royalties money.futureofmusic.org/40-revenue-streams/
C

12. Publisher settlements
The rate: Varies by lawsuit
What it’s for: Payments from publishers to writers for
litigation settlements
Who pays it: Entities that lost the lawsuit pay a fee to
publishers, which should pass it along to writers and
composers whose work was infringed
Who gets the money: Publishers and writers
C

Sound recordings/recording artist
13. Record label advance
14. Record label support
15. Retail sales
16. Digital sales
17. Sales at shows
18. Interactive service payments
19. Digital performance royalties
20. Master use synch license
21. AARC royalties
22. Neighboring rights royalties
23. Film and Secondary Market
Fund royalties
24. Sound Recording Special
Payments Fund royalties
25. AFTRA Contingent Scale
payments
26. Label settlements
RA

13. Record label advance
What it’s for: Paid to artist as part of signing a record
deal, usually an advance on future record sales
Who pays it: Record label
Who gets the money: Recording artist
RA

14. Record label support
What it’s for: Money from label for recording or tour
support. Usually recoupable against album sales
Who pays it: Record label
RA

15. Retail sales
The rate: Varies based on record label deal. Usually
10-15% of wholesale price, but some labels pay 50%.
What it’s for: Revenue generated from selling physical
music (CDs/vinyl) in retail stores or via mailorder
Who pays it: Retail stores pay distributor which pays
label, CD Baby for mailorder, or direct from mailorder
customers at your own website
RA

16. Digital sales
The rate: Varies. Artists on label may get 10-15% of
wholesale price, but some labels pay 50%. Self-released
artists get a bigger percentage.
What it’s for: Revenue generated from selling music
digitally/online (iTunes, Amazon, Bandcamp, your own
site)
Who pays it: Retailers pay labels and aggregators like
CD Baby or TuneCore, or direct from customers at your
own website
RA

17. Sales at shows
The rate: Varies.
What it’s for: Revenue generated from selling recorded
music (CDs/vinyl/cassettes) at shows/live performances
Who pays it: Fans
RA

18. Interactive service payments
The rate: About half a penny per play
What it’s for: Revenue generated when your sound
recordings are streamed on on-demand services
(Rhapsody, Spotify, Rdio)
Who pays it: Service pays label, or digital aggregator like
CD Baby/TuneCore
RA

19. Digital performance royalties
The rate: Varies by platform, but rates are published
What it’s for: Revenue generated when your sound
recordings are played on internet radio, Sirius XM,
Pandora
Who pays it: Webcasters pay SoundExchange, which
then pays labels 50%, featured performers 45%,
background musicians and singers 5%
RA

20. Master use synch license fees
What it’s for: Typically licensing an existing sound
recording for use in a movie, documentary, TV, video
games, internet or a commercial
Who pays it: Movie studio, ad agency, game company, etc.
Who gets the money: Recording artists and labels share a
fee for licensed use of sound recording
RA

21. AARC royalties
The rate: It’s complicated
What it’s for: Collected for digital recording of your
songs, foreign private copying levies, and foreign record
rental royalties
Who pays it: Audio hardware and blank CD
manufacturers pay AARC, which then pays performers
and record labels
Who gets the money: Recording artists and labels
RA

22. Neighboring rights royalties
The rate: Varies from country to country
What it’s for: Collected for the foreign performance of
your sound recordings
Who pays it: Foreign broadcasters pay this money to
foreign collection societies
Who gets the money: Recording artists and labels. Note
that collecting this money is very difficult because US
does not have reciprocal rights
RA

23. Film Musicians
Secondary Markets Fund
What it’s for: Paid to performers on recordings made for,
or used in, film or TV
Who is eligible: Performers who have worked on
recording done under AFM collective bargaining
agreement
Who pays it: AFM collects these funds and distributes it
to performers who have credits on recording
RA

24. AFM/Sound Recording
Special Payments Fund
What it’s for: Paid to performers on recordings based on
the sales of recorded music
Who is eligible: Performers who have worked on recording
done under AFM collective bargaining agreement
Who pays it: Record labels pay portion of sales revenues
to SPF, which then distributes it to performers who have
credits on recordings
RA

25. SAG-AFTRA contingent scale
What it’s for: Payments paid to non-royalty artists when a
recording hits certain sales plateaus
Who is eligible: Non-royalty artists appearing on
recordings that reach certain sales levels in the US
Who pays it: Record labels pay portion of sales revenues
to SAG-AFTRA, which then distributes it to non-royalty
artists who have credits on recordings
RA

26. Label settlements
The rate: Varies by lawsuit
What it’s for: Payments from labels to recording artists
for litigation settlements (MP3.com, Limewire)
Who pays it: Entities that lost the lawsuit pay a fee to
record labels, which should pass it along to recording
artists whose work was infringed
Who gets the money: Recording artists and labels
RA

Live performance/being a performer
27. Salary as part of an orchestra, ensemble or band
28. Live performance fee/guarantee
P
Session or sideman work
29. Session work/freelancer in studio
30. Session work/freelancer on tour
31. AFM/AFTRA Fund
P

27. Salary as member of orchestra,
band or ensemble
The rate: No standard rate, but consistent paycheck
What it’s for: Income earned as a salaried member of an
orchestra, band or ensemble
Who pays it: Orchestra, band or ensemble
Who gets the money: Performer
P

28. Show or performance fees
The rate: No standard rate, but either a guaranteed fee
and/or a percent of ticket sales
What it’s for: Revenue generated from playing in a live
setting (for non-salaried players).
Who pays it: Concert promoter, presenter or venue
Who gets the money: Performer
P

29. Session musician/studio fees
The rate: AFM scale, or rate set by freelancer and
producer
What it’s for: Payments to studio musicians/freelancers/
sideman for work in recording studio
Who pays it: Studio, producer, featured artist or record
label, depending on situation
Who gets the money: Session player
P

30. Session musician/live fees
The rate: AFM scale, or rate set by freelancer and
producer
What it’s for: Payments to studio musicians/freelancers/
sideman for work in a live setting/on tour
Who pays it: Featured artist, presenter, promoter or
record label, depending on situation
Who gets the money: Session player
P

31. AFM/SAG-AFTRA payments
What it’s for: AFM/SAG-AFTRA Intellectual Property
Rights Distribution Fund distributes recording and
performance royalties to non-featured artists
Who pays it: Primarily, this is the 5% that
SoundExchange collects from digital broacasters that is
then paid to non-featured performers.
Who gets the money: Non-featured performers
P

Knowledge of the craft
32. Teacher
33. Producer
34. Honoraria/speaker fees
KC

32. Music teacher
The rate: Varies/set by teacher
What it’s for: Payment for teaching your musical craft
Who pays it: Students, schools, conservatories,
foundations
Who gets the money: Music teacher or performer
KC

33. Producer
The rate: Varies. Could be a flat fee or “points” on a
project
What it’s for: Payment for producing another artist’s
work in the studio or in a live setting. Sometimes
producers also get writing credits for work in studio
Who pays it: Labels, featured artists, studios, presenters,
foundations, depending on situation
Who gets the money: Musician or producer
KC

34. Honoraria or speaker fees
The rate: Set by musician and host organization
What it’s for: Payment for conducting a lecture,
workshop or master class
Who pays it: School, conservatory, presenting
organization
Who gets the money: Musician
KC

Your brand
35. Merchandise sales
36. Fan club subscriptions
37. YouTube partner program
38. Ad revenue
39. Persona licensing
40. Product endorsements
41. Acting
42. Fan funding
43. Sponsorship
44. Grants
KC B

35. Merchandise sales
The rate: Varies by item
What it’s for: Revenue generated from selling branded
merchandise (t-shirts, hoodies, posters, etc.)
Who pays it: Fans, sometimes retailers
Who gets the money: Musician or performer
B

36. Fan club
The rate: No standard rate, but usually an annual fee
What it’s for: Money directly from fans who are
subscribing to your fan club
Who pays it: Fans and supporters
Who gets the money: Musician or performer
B

37. YouTube partner program
The rate: Not disclosed
What it’s for: Shared advertising revenue generated by
plays on YouTube. Can also include plays of user-generated
content that uses your music, as identified by
YouTube’s Content ID program
Who pays it: Advertisers pay YouTube, which passes
along money to rightsholders
Who gets the money: Rightsholders: record labels,
artists money.futureofmusic.org/40-revenue-streams/
B

38. Ad revenue
The rate: Varies
What it’s for: Miscellaneous income generated by your
website properties (click-thrus, commissions on Amazon
sales, etc.)
Who pays it: Advertisers, services that offer
commissions
Who gets the money: Musicians
B

39. Persona licensing
The rate: Varies
What it’s for: Payments from a brand that is licensing
your name or likeness (video games, comic books, etc)
Who pays it: Advertisers, video games, lifestyle brand
companies
B

40. Product endorsement
The rate: No standard. Sometimes payment is free
product instead of cash
What it’s for: Payments from a brand for you endorsing
or using their product
Who pays it: Music instrument manufacturers, beverage
companies, other companies
B

41. Acting
What it’s for: Payments for appearances in TV,
commercials, movies
Who pays it: Movie and TV producers
B

42. Fan funding
What it’s for: Money raised directly from fans to support
or pre-sell an upcoming recording project or tour
(Kickstarter, IndieGogo, Pledge Music)
Who pays it: Fans and supporters
B

43. Sponsorship
What it’s for: Corporate support for a tour, or for your
band/ensemble
Who pays it: Companies/corporations
B

44. Grants
What it’s for: Foundation or public arts grants to support
your work/project
Who pays it: Foundations, arts councils, endowments,
state or federal agencies
Who gets the money: Performers, composers,
ensembles, collaborations
B

Producer and songwriter: gross income 2010-11
Songwriter/producer/
arranger fees
50%
PRO royalties
Synch licensing fees
Mechanical royalties
5%
Sheet music licensing
5%
10%
25%
Ringtone licensing
5%
Years active: 1994-present
Roles: Songwriter, producer,
arranger
Percent of time: 100%
Percent of income: 95%
Genres: R&B, hip hop and pop
2010 Activity: wrote about 450
songs to pitch to artists, participated
in 50 writing sessions, worked with
25 different recording artists
money.futureofmusic.org/case-studies/

Recording artist: gross income 2010-11
Publisher support
25%
Merchandise sales
10%
Live performance fees
25%
Record royalties
10%
Record label support
30%
Roles: Recording artist, composer,
performer, producer
Genres: indie rock, pop
2010-11 Activity: One recording,
50-100 live performances

Jazz manager: gross income 2010-11
Teaching
10%
Composer commission
7%
CD sales on the road
6%
Live performance fees
62%
Record label advance
7%
PRO royalties
5%
Session musician
2%
Years active: clients range from
fewer than 10 years, 10-20 years,
30-40 years
Roles: Recording artist, composer/
arranger, performer, band leader,
producer, side musician, educator
Genres: jazz
Typical 2010 Activity: One
recording, 40 live performances

Nashville session player: gross income 2010-11
Roles: Performer, session musician,
producer, bandleader, songwriter,
journalist, label owner
Genres: country, bluegrass, rock,
jazz
2010-11 Activity: 1 album as leader,
produced 2 albums, 30-40 recording
sessions, 40 live performances
Record sales
11%
Session player: studio
30%
Mechanicals and
PRO royalties 3%
AFM/AFTRA Fund
4%
SR Special Payments Fund
AFM Secondary Markets Fund
4%
6%
Producer
22%
Live performances
17%
Digital performance
royalties 3%

Classical performer: gross income 2010-11
Live performance fees:
City Opera salary
46%
AFM/AFTRA Fund
1%
Live performance fees:
City Ballet sub
Freelance performance fees
AFM Secondary
Markets Fund
7%
14%
28%
Session player: studio
fees for film music
3%
Teaching
1%
Roles: Performer, session musician,
teacher
Genres: classical
2010 Activity: 5-10 recording
sessions, 150-200 live performances

Freelance violinist: gross income 2012
Sideman:
live, in studio, on TV
71%
Administrator/Curator
25%
TV Residuals
1%
Live performance
(Leader)
1%
1%
Sound Recordings
Special Payments Fund
1%
Roles: Performer, producer, session
musician/freelancer, composer
Genres: contemporary classical,
jazz, indie, americana
2012 Activity: 6 recordings,
75 shows with 12 different groups

Retired indie rocker: gross income 2012
Recording
sales royalties
52%
Digital
performance
royalties
48%
Years active: 1990-1997
Roles: Performer, recording artist,
songwriter
Percent of time (now): 5%
Genres: indie rock
2012 Activity: collected royalties on
4 albums

Indie rock composer/performer: gross income
Live
Performance
30.5%
Salary
29.8%
CD Sales on
the Road
12.1%
Publishing
Royalties
9.4%
PRO
Royalties
6.2%
Publishing
Advance
5.6%
Record
Sales
3.5%
TV
Royalties
0.4%
Producer
0.7%
Session
Musician
1.5%
Roles: Performer, composer,
session/sideman work
Genres: rock, world, avant, folk rock

Chamber music ensemble: gross income 2002-10
Years active: 1997- present
Roles: Performer, session/sideman
work
Genres: classical, new music,
contemporary jazz

Jazz bandleader: gross income 2001-11
Live
Performance
77.8%
Grants and
Awards
7.5%
Record Label
Advance
5.0%
Commission
2.6%
Sideman
Record Sales 1.8%
1.7%
PRO Royalties
0.8%
Other
2.8%
Roles: Composer, performer,
bandleader, session/sideman work,
teacher
Genres: jazz, classical, hip hop

Salaried orchestra player: gross income 2001-11
Roles: Performer, session/sideman
work
Genres: classical
Salary:
orchestra
64.8%
Freelance: live
27.3%
Knowledge of
Craft
3.1%
Freelance:
studio
Prize Money 1.9%
1.8%
Recording
Income
0.8%
Radio
Royalties
0.3%

Sideman:
Performance
32.4%
Live Performance
15.0%
Administrator
14.9%
Grant
11.6%
Teaching
CD Sales on
the Road
0.4%
Recording
0.9%
PRO Royalties
Sideman: 10.5%
Performance +
Organizer
8.0%
2.1%
Sideman:
Recording
4.3%
Jazz sideman: gross income 2004-10
Roles: Performer, composer,
bandleader, session/sideman work,
administrator, consultant, teacher
Genres: jazz, contemporary
classical, world music

Revenue streams have
become atomized.
More important than ever
that creators understand
how the money flows back
to them as songwriters and
recording artists.
Streaming mechanicals
Mechanicals for cloud storage, lockers
Commissions
Composing original works for broadcast
Sheet music
Lyric display
Retail sales
Sales at shows
Digital downloads
Cloud storage payments
Digital performance royalties
Interactive service payments
YouTube partner program
Synchs
Performances
Session work
Merchandise
Persona licensing
Fan funding
Sponsorships
Grants

Resources
Artist Revenue Streams
Research
money.futureofmusic.org
42 Revenue Streams
Revenue Streams: Existing,
Expanded, New
money.futureofmusic.org/40-revenue-streams/ money.futureofmusic.org/revenue-streams-existing-
expanded-new/

Resources
Music and How the Money
Flows infographic
HOW THE MONEY
FLOWS BACK TO
songwriters, artists,
publishers & labels
How are musicians and songwriters compensated when
their music is played on the radio, sold on digital platforms,
broadcast radio terrestrial broadcast of any AM or FM station
webcast, or streamed on interactive services?
C PROs ASCAP, BMI, SESAC
songwriter
publisher
performance of composition
In the US, terrestrial broadcasters
do not pay performers or
sound recording copyright owners
performance of sound recording
For digital stores and on-demand streams,
* At the end of 2012, Universal Music
Publishing Group and Sony/ATV-EMI
pulled their digital rights from ASCAP
and BMI, seeking to get a higher rate
by negotiating directly with webcasters.
how the money flows depends on what entity negotiated the license.
For record labels that have a direct deal with services:
digital sale
iTunes • Amazon
Google Play • eMusic
SR record label
publisher songwriter
mechanical reproduction of composition
artist/band*
sale of sound recording
9.1¢
/track
10-50%
* Rate of payment from label to artist/band
depends on terms of contract, and whether
digital sale is classified as a sale or a license.
0.5% Sound Recording
Special Payments Fund #
musicians
# Labels contribute a small percent of
sound recording sales income. If
recording was made under the AFM’s
recording agreement, payments are
disbursed to musicians who were paid
scale wages during the recording session.
C PROs ASCAP, BMI, SESAC
futureofmusic.C UMPG and Sony ATV-EMI* org/moneyflow
* At the end of 2012, Universal Music
For record labels that are represented by a digital aggregator/distributor:
SR aggregator
mechanical reproduction of composition
artist/band*
sale of sound recording
publisher songwriter
IODA/The Orchard
record label
9.1¢
/track
@50%
85%
AFM & SAG-AFTRA Fund
webcast
or digital performance
Pandora • Sirius XM • NPR streaming
any webcast stations
C PROs ASCAP, BMI, SESAC*
SR SoundExchange
songwriter
publisher
record label
performer(s)
50%
45%
5%
digital performance of sound recording background singers
and musicians
UMPG and Sony ATV-EMI* UMPG and Sony ATV-EMI
C songwriters
songwriter
songwriter
on-demand
stream
Spotify • Rdio • Rhapsody
SR record label
artist/band*
streaming mechanical royalty
licensed use of sound recording 10-50%
10.5%
minus payment
to PROs
publisher
publishers
Publishing Group and Sony/ATV-EMI
pulled their digital rights from ASCAP
and BMI, seeking to get a higher rate
by negotiating directly with services.
UMPG and Sony ATV-EMI
songwriters
PROs ASCAP, BMI, SESAC
songwriter
publisher
on-demand
C
* Rate of payment from label to
artist/band depends on terms of
contract, and whether digital sale
is classified as a sale or a license.
* Rate of payment from label to
artist/band depends on terms of
contract, and whether digital sale
is classified as a sale or a license.
big labels
indie labels
For radio and radio-like services,
blanket licenses determine who gets paid, and how much.
digital sale
iTunes • Amazon
Google Play • eMusic
New Business Models Digital Distribution
and how to participate
futureofmusic.org/nbm futureofmusic.org/dd

For composers and publishers
www.ascap.com www.bmi.com
www.sesac.com www.harryfox.com

For performers and sound recording
copyright owners
www.soundexchange.com

For performers
www.raroyalties.org www.fmsmf.org

For performers
www.aarcroyalties.com www.sound-recording.org

Future of Music Coalition
@future_of_music
www.futureofmusic.org
money.futureofmusic.org
Kristin Thomson
@kristinthomson
kristin@futureofmusic.org

All the revenue streams for musicians

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