Music industry revenue has seen more steady growth over the past decade and experts projected that it will stay on that path for the foreseeable future. The numbers may increase with the growing popularity of streaming among the younger generation. As physical sales declined in late 2010, other means of sale emerged and millions of independent musicians turned to licensing their music in hopes of monetizing their work. The Internet paved the way for more business opportunities, and almost all of them require music content. More music revenue can be raised compared to a decade ago as we have more TV shows, commercials, commercials, campaigns, video games, movies, movies, establishments, and businesses today. Every industry needs music content to operate in order to attract audiences. It is part of their marketing plan and these industries require the services of music licensing companies to facilitate such needs.
In fact, the US music industry revenue for 2015 increased 0.9% to accumulate $ 7 billion USD. The RIAA also announced that streaming has surpassed digital and physical music sales for the first time, going from 27% in 2014 to 34% in 2015. Streaming sales increased just 29% in 2015. Digital sales fell by $ 2.58 billion in 2014 to $ 2.33 billion in 2015, a decrease of 9.6%. With the rise of streaming, physical sales spiraled further down as it only racked up $ 1.9 billion in sales, 10% of sales in the US This was not the case 10 years ago as sales Physical sales dominated the music industry.
Most of them come from performance rights organizations and music licensing companies. These companies license their members’ music and distribute it to different industries across the country. There are three performance rights organizations for musicians in the US and they are ASCAP, SESAC, and BMI.
The American Society of Composers, Authors, and Publishers (ASCAP) is a nonprofit performance rights organization that protects the musical copyrights of its members by monitoring public performances of their music. This organization was launched in 1914, making it the oldest of the three. They compensate their members based on the live and public performances of their music from other sectors.
As of 2015, ASCAP has licensed over 500,000 music composers, songwriters, and publishers. In 2014, it raised more than $ 941 million in license fees and distributed $ 828.7 million in royalties to its members. ASCAP charges a $ 50 fee as a writer and a $ 50 fee as an editor to become a member. To collect your publisher’s portion of royalties as a member of ASCAP, you must have an ASCAP publishing company.
Broadcaster Music, Inc. (BMI) is a performing rights organization in the USA This organization was established in 1939. It collects license fees on behalf of its members and distributes them as royalties to songwriters, songwriters and publishers of music whenever his work is used in live or public performances. In 2015, BMI has raised more than $ 1.013 billion in license fees and distributed more than $ 877 million in royalties to its members. BMI represents 8.5 million musical works created and owned by more than 650,000 members. To become a member, BMI has a fee of $ 150 for publishers. However, they will not charge any fees to the songwriters. You don’t need a publishing company to collect your publisher’s share of royalties at BMI.
The Society of European Stage Authors and Composers, commonly known today as SESAC, is also a performance rights organization in the US SESAC was first operated in 1930, the second oldest of the three. Unlike ASCAP and BMI, SESAC members must be approved or recruited to join your organization. It has no open membership. They represent more than 400,000 songs on behalf of their 30,000 affiliate writers. SESAC also withholds an undisclosed amount of performance royalty income from its members.
These organizations collect royalties from industries that use the work of their members. They distribute the royalties collected to their members. A royalty rate is the payment charged by one party to another for the continued use of a copyrighted asset. For example, if your member’s song is played on TV shows, movies, or advertisements, you will collect the copyright and distribute it to your member, who is the copyright owner of the music used. There are also different types of music royalties to remember.
Mechanical Royalty – Mechanical royalties are royalties paid to a songwriter each time a copy of one of their songs is made. This royalty is paid by record labels or publishers of composers’ albums.
Performance Rights Royalty: The Performance Rights Royalty is a royalty paid to a songwriter for the live performance of a song. Aside from a song used in live performances, such as city events, parades, etc., a live performance can also be a public replay of a recorded song, such as a radio play, TV commercials, commercials, and more. The general license is also used to distribute a large amount of music during an agreed period of time. This usually occurs in cases where individual song licenses would be difficult to manage. Performing rights societies use general licenses to give license applicants access to the entire album or songs of their members.
The usual split between musicians and these companies is 50/50 while others are 60/40. The percentage of the split is normally negotiable to benefit both parties involved.
There are also other means of compensation for the use of music content. These are called sync fees. A sync fee is a license granted by the owner of copyrighted music to allow the licensee to sync the music with the visual media. Visual media is made up of TV shows, movies, movies, commercials, commercials, websites, video games, etc.
Synchronization fees are generally paid in advance and are painstakingly negotiated based on asset usage. For example, if a car company needs music content for an upcoming commercial, it will actively search for songs that possibly fit what they are trying to achieve. The need is immediate and the compensation is also in advance. Synchronization fees can range from a few dollars to thousands, depending on the content. Some packages are one-time rates and others are based on usage or usage times.
There are other parties involved in collecting royalties, such as music publishers. Music publishers are in charge of making deals with songwriters and songwriters. They promote the songs of their songwriters and composers to musicians and anyone else who may need musical content like movies, TV commercials, etc. They also issue licenses for the use of the songs they represent and charge license fees.
Many music publishers are interested in distributing the work done by composers and musicians. Music publishers have extensive experience on what to do and will have a large list of contacts to promote songs to the maximum number of potential licensees and negotiate the payment and use of each asset.
Most have internal connections or subscribe to specific industries and other services that give them advice or early indications if someone is looking for music content for a particular project. They are also aware of the resurgence of the industry and the influx of new or old industries that need music content. Music publishers are always looking for new sources of income in this technology-driven world.
If you are a freelance composer or musician, you must obtain a license for your music. Not only is it important, it also saves you time to focus solely on your passion and let others handle all the complex stuff in music licensing. Some of the music licensing companies also act as advisers and critics, so learning more could really improve your chances of achieving great success locally or nationally.
Now is a great time to monetize and share your work with others so you can’t pass up this opportunity. The music industry is constantly evolving and reaching new heights in terms of revenue. You must evolve with them making quality music and expanding your craft at the same time.
You can learn more about music licensing companies along with my top 50 music licensing companies in the US by viewing my free video training course at http://silverscreenmusician.com. I see you there!