(Read Part One)
(Read Part Two)
The right to perform your songs is one of the six copyrights that can get money delivered to your mailbox. Live concerts, radio, television, restaurants, and elevators all count as public performances. Every time you or another performer sings your songs in a live concert, or a recording of your song plays in a restaurant or elevator, or as background in a TV show, you are earning performance royalties. The easiest way to collect mailbox money for your songs is to affiliate with a Performing Rights Organization (PRO) such as ASCAP, BMI, or SESAC. These organizations collect license fees from clubs, arenas, concert halls, universities, restaurants, and more; later they distribute that money to songwriters and publishers. All you have to do is join a PRO, tell them what songs you have written, and wait for your checks to be delivered!
The Best PRO
You can only affiliate with one PRO at a time, so talk to your fellow musicians about their experiences with their PRO before deciding which to join. Although there are many PRO’s worldwide, in the U.S. you can choose from ASCAP, BMI, and SESAC. The two largest PRO’s in the U.S. are ASCAP and BMI, some differences between them include the way that they calculate your performance royalty payments.
The payment formulas are complex and change periodically. ASCAP divides the total licensing fees collected by the number of ASCAP performances during the quarter, with some performances earning a higher royalty. Your portion of the licensing fees will be based on the type of performance (themes vs. background, etc.), and the medium (radio, live performance, network vs. local television, etc.) in proportion to how often your songs are performed. Your royalty payments are based on more than just the quantity of performances, a featured performance on a national hit television show will give you more money than being performed on a local radio station.
BMI’s payment formulas are different, with certain types of performances earning a fixed dollar amount. Like ASCAP the value of each performance varies based on type and medium, but with BMI it may also be affected by factors such as the audience size and time of day. Each quarter BMI also pays voluntary bonus payments to certain types of performance areas, such as when a song achieves hit status on national radio. Here is a detailed account of their royalty payment system.
Leaving Money on the Table
While you consider which PRO to join you also need to make sure to collect all the money owed to you. PRO’s divide the licensing money for a song into two parts known as the writer’s share and the publisher’s share. For example, out of each dollar that your song earns in performance royalties, 50¢ goes to the group of writers and 50¢ goes to the publishers. If you have a publisher they will want to collect their share, and will probably register your songs with a PRO themselves, but if you don’t have a publisher you might be leaving money on the table!
If there is no publisher listed for your songs then ASCAP or BMI will keep the publisher’s share, and you will only be collecting half of the royalties available to you. Working with a publisher can have its benefits, especially if you don’t have the time or connections to effectively promote your songs. A good publisher may be able to get your songs performed or recorded by other bands, and may earn you more licensing fees than they will cost you. However, if you choose to self-publish (aka you don’t work with a publisher) make sure to register yourself as a publisher with your PRO so that you can collect both the writer’s share and the publisher’s share. The registration process for publishers is very similar to registering as a songwriter; fill out an application and pay the fee, and you could potentially double your royalty payments.
Each songwriter in your band will need to affiliate separately, you can choose to joint different PRO’s, when you register the songs the organizations will automatically split the payments up. For example, if you and your bandmate co-author a song your PRO’s will send you each a separate check for your half of the performance royalties. Each writer can only be affiliated with one PRO at a time, but you don’t have to remain with the same PRO for life. You can switch PRO’s when your affiliation contract period ends (although this might mean additional fees and paperwork).
To join ASCAP as a writer you will need to pay a one-time registration fee of $50 via credit card and provide basic identification information including you social security number. If you choose to join as a publisher you must fill out a separate application complete with a social security number or company tax ID, and pay another $50 registration fee. Make a list of all the songs you have written so that you can register them once you join. Visit ASCAP for details.
Songwriters can join BMI for free, however if you choose to self-publish there is a $150 one-time fee ($250 for publishing companies). The BMI application process is similar to ASCAP’s, visit BMI for details.
The smallest of the U.S. PRO’s, SESAC has a selective application process to affiliate. Instead of filling out an online application you must email the SESAC staff directly. SESAC touts exclusivity and personal service among the benefits of joining their roster. Visit SESAC for details.
ASCAP: James Hetfield and Lars Ulrich from Metallica
BMI: Germanotta Stefani (aka Lady Gaga)
SESAC: Bob Dylan
ASCAP also has a great (free) database that allows you to discover the writers (and their PRO affiliations), performers, and publishers of your favorite songs. This information can be vital if you want to do cover songs for your next album, or find out whom you should approach for permission to alter lyrics. Find out who owns the songs you love.