Royalty Collection for Independent Artists

A Guide to Royalty Collection for Independent Artists

It is not easy to be an artist. If you are a musician, music is part of yourself, and creating it is probably not an option, but a necessity. Nonetheless, for being able to sustain a career in music, and being able to work on it full time, you also need to understand it from an economical perspective. Yet, the path to financial success can be intricate, and the resources for being able to guide your career, are still scarce, especially when it comes to navigating the complex world of royalty collection. This blog post aims to offer basic guidance and tips on effectively getting started in your musical career. Take it as a first step to continue growing.

The Basics of Royalty Collection: Publishing vs Master Royalties:

The very first and most important step to start navigating this world is to know that there are two main streams or royalties coming from your music: the royalties coming from the recording / master side, and the royalties coming from the copyrights of your music, commonly known as publishing rights. Each kind is handled in a totally different way. 

1. The master royalties are normally taken care of by the distribution services you use (Distrokid, TuneCore, CD Baby, etc. Since the digital music is always linked to an ISRC code, it is relatively easy to link them to the original artist and the payment process is efficiently automated.  

2. The Publishing Royalties are royalties derived from your copyrights. They are linked to the composition itself, and not to the master recording (for example,two versions of the same song have different master royalties streams, one per recording, but they should both be linked to the same composition, and thus, the publishing royalties converge).They are divided between the Mechanical and the Performance Royalties, and it is not possible to collect them as an individual artist, because these royalty streams require actively controlling different usages of your music in different territories. Because this supposes an enormous challenge, the job is normally done by specialized entities called CMOs (Copyright Management Organizations) or IMEs (Independent Management Entities, and Unison is part of this group). The difference between them will be explained in a future post.

As explained before, whilst the master royalties are effectively handled by the music distribution companies, for the publishing royalties, being affiliated to a CMO or to an IME is a fundamental step. Each entity, in each country, has different joining procedures and conditions. It is important to check them out and decide which one you prefer. If you are interested in knowing more about how Unison works, check out our website

Best practices to make the most of your Music

As an independent artist, it is important that you understand all the areas in which you can make the most of your music. These are some recommendations to guide you in the right direction.

1. Explore Digital Distribution Platforms: Utilize digital distribution platforms like TuneCore, CD Baby, or DistroKid to distribute your music across various online channels. These platforms not only make your music accessible to a global audience and also are able to handle the master side of the royalty collection on your behalf. It is important to read carefully their different terms and conditions, so you can make the right choice depending on the peace in which you make music and the type of return you are expecting from it. 

2. Register Your Works: It is common that artists worry more about how to put their music in Spotify, YouTube, Deezer and other platforms, than about how to properly register their works to collect the publishing royalties. Nonetheless, besides how to put your music out, you also need to ensure that all your works are properly registered with your chosen CMO or IME. And, for maximizing the collection of your publishing royalties, it is really important that you perform this registration step BEFORE submitting your music to distribution. The recording side of the music moves at a way faster pace than the publishing side of it, and that’s why it is important to start the registration process with your CMO or IME before you start the distribution process. Proper registration facilitates accurate tracking and collection of royalties from the very first steps of your music once it is out. Just as it happens with the affiliation process, the registration process can take longer or shorter time depending on how your CMO or IME works. Some of them are highly digitalized and make it very easy to proceed with the registration, whilst others take longer times and require more paperwork. Be sure you understand how easy it will be for you to register your works before deciding for one CMO/IME or another.

3. Leverage Streaming Services: Embrace the opportunities presented by streaming services like Spotify, Apple Music, and Deezer. While the revenue per stream may be modest, the cumulative impact of a large number of streams can contribute significantly to your overall earnings. Try to find out which playlists would work best for your music, take care of your artist profile descriptions and pictures lyrics, social media links, etc. Everything adds up to maximize the impact of your music. In some platforms, such as YouTube, there are special Partnership Programs that allow you to gain more control about the monetization capabilities of the platform. Try to understand how they work. YouTube has several available resources and courses to help artists to understand how to navigate their content in the platform. You can find some courses and training programs at Google’s Skillshop

4. Understand Licensing Agreements: This might be a further step, if you are just starting out, but you should know that there are other important potential royalty streams for your music. A really interesting one is what is called “Sync”, which means, synchronizing your music with visual formats in films, TV shows, commercials, or other media. Before these usages, it is important to put licensing agreements in place, for both the master side and the publishing side. Before you jump into one, it is important to carefully review and negotiate these agreements. Understanding the terms, including upfront fees, royalty percentages, and duration, is the only way you can ensure a fair compensation for the use of your work. In case one of these opportunities comes in place, we highly recommend you to get in touch with an entertainment lawyer able to properly review the terms and get the best deal for you and your music. We’ll talk in more detail about these types of agreements in a future post.

Stay Informed and engage with the Music Business World… and with your audience!

1. Educate Yourself and get Involved in the Music Ecosystem: Stay informed about industry trends, changes in royalty collection practices, and new revenue streams. Regularly check updates from your CMO/IME and industry publications to stay ahead of developments. Try to network with music industry professionals, or follow their pages over linkedin. There are so many free educational and networking activities, both online and presential, for independent musicians. Make the most of them! Consider going to Music Business Congresses in your country (or abroad, if you like to travel!!), in order to get a better understanding on how the entire music ecosystem works.

2. Build and Engage Your Fanbase: Cultivate a strong online presence and engage with your fanbase through social media and streaming platforms. A loyal fanbase can contribute to increased streaming numbers, merchandise sales, and attendance at live performances, all of which impact your overall earnings. There are so many successful examples of artists using crowdfunding platforms such as Patreon, to engage with their fans, and, after Covid, a lot of artists tasted the benefits of using social media platforms such as Instagram to perform Live Streaming events or simply to engage more directly with their fans. There’s a world of possibilities!

Plan for Long-Term Success:

1. Diversify Your Income Streams: Royalties aren´t the only income an artist can (and should!) see. There are several other ways to monetize your music career. Explore additional income streams such as merchandise sales, crowdfunding, and live performances. Diversification can provide financial stability and sustain your music career in the long term, and all the alternative planning and job you do for your career will help to grow the engagement of your fanbase and leverage its growth.

2. Invest in Your Craft: Try to invest a portion of your earnings back into your music career. This could include making professional recordings or photo-shoots, professionalizing your marketing efforts, going to Music Industry Congresses or establishing collaborations. All of these actions will greatly help to enhance the quality and visibility of your work.

Conclusion: Empowering Independence in Music Business

Collecting royalties as an independent artist requires strategic planning, ongoing education, and an entrepreneurial spirit. By understanding the basics of royalty collection, leveraging digital platforms, and engaging with your audience, you can empower yourself to not only create exceptional music but also build a sustainable and lucrative career in the ever-evolving landscape of the music industry. And, remember… there are so many areas in the music industry, and there are many artists and other professionals around that share a great passion and love for music. You are never alone! Nobody was born knowing how to navigate this world, and chances are high that, if you are serious and motivated about your craft and your career, so many people will be willing to help!

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