I was always wondering how much money do artists make from the radio. I’ve heard a lot of opinions, some ridiculous and other valid. Eventually, I took matters into my own hands. I decided to research this topic thoroughly and once and for all solve the mystery of how much do artists make on the radio from their songs.
Artists make on the radio between $0 and $0.12 per radio play. This is because FM/AM radio stations only pay royalties to songwriters and publishers, not the artist. An artist can earn money from radio plays only if they wrote the song themselves or if they have their own publishing company.
I just gave you the short answer, but there is more it. Stick around to find out exactly why artists make what they make from radio plays but also how Internet radio and streaming services significantly differ from traditional AM/FM radio.
Disclaimer: The following information is not meant to be taken as legal advice. I highly recommend that you consult the appropriate authorities and licensing bodies in your country. This article is solely a starting point to make things easier for you.
Do Songwriters Get Paid More Than Artists
This Is How Radio Stations Pay Royalties
In the US, large radio stations pay about $0.12 (12 cents) per radio play, and College Station’s pay about half of that. From the 12 cents, half of the money goes to the songwriter(s), and the other half goes to the publisher, the artist themselves get paid only if they helped to write the song.
Furthermore, if the artist owns their own publishing company and also writes their own songs, they will earn a full $0.12 each time their songs are played on a major radio station.
This Is Who Gets Paid When We Hear a Song on the Radio
Songwriters and publishers and not artists/performers get paid from “radio royalties.” That is because the ones that write the songs are not the ones performing them. Artists don’t receive public performance royalties.
But wait a minute. Isn’t it true that music artists write all their songs themselves?… Well, not exactly.
I will shed light on this mystery, I will talk about the differences between songwriters and artists, and then we will explore together what public performance royalties are.
Ready? Let’s begin!
Do Artists Write Their Own Songs?
Okay, are you ready for the revelation? (drum roll please)!
This is the picture most people have about the music industry:
Artist X is playing at home on his favorite instrument when he suddenly gets a burst of inspiration for a new song. He/she finds the right chords, starts singing, and comes up with the ideal lyrics. Next, they record the whole thing on their phone and head the following day to the studio to create their next hit.
While this story is undoubtedly beautiful and inspiring, unfortunately, (for the most part) it is also just a fairytale.
The truth is that most artists don’t write their own songs (or they only write a small part of it) and they don’t write their own lyrics.
This Is What Happens with 90% of the Pop Songs
There is a team of songwriters (ranging between one and four writers) that are responsible for the whole process, which includes creating the chords, melody, and lyrics.
The next step is to send the song to a music producer who creates on the computer the sounds, the Fx’s, and records the necessary instruments. Now its time for the artist to come into place, and only then will they are summoned in the studio to record their vocals. Finally, the mixing and mastering engineer will add the final touches and make sure that the new “smashing hit” can be played on all radio and streaming services.
I told you the story to illustrate that there is more than one person involved in the whole process, and not all of them will get paid from radio plays!
What Are Public Performance Royalties
Public performance happens when a song is transmitted, sung, or played: live on TV, at live concerts, or on the radio, on the internet, in bars, and in restaurants.
More specifically, songs played on traditional radio are considered a public performance, and public performances generate performance royalties. In the US ASCAP, BMI and SESAC collect these performance royalties. These companies are known as PRO companies (Performing Rights Organization).
Who Gets Paid From Public Performance Royalties?
Songwriters. Its the songwriters and publishers but not the artist who get paid from public performance royalties.
Of course, if the songwriter also helps to write the song, they will get their appropriate cut.
If you are an artist, and you think radio is a lost cause, don’t get discouraged just yet! Bellow, I have some great news for you. Just keep reading 🙂 .
Artist Do Get Digital Performance Royalties (Internet Radio and Streaming Services)
This is where it might become a bit confusing. As we mentioned, the way copyright regulation stands, songs that are played on the radio (FM/AM) pay public performance royalties only to songwriters and publishers and not to the performer/artist.
However, both artists and songwriters receive digital performance royalties from internet radio and streaming services such as Spotify, Tidal or Pandora.
Lastly, the amount per play for digital performance royalties is not set at a fixed rate. Instead, each streaming service has its own payment rate, which dramatically varies from service to service. But wouldn’t it be better if there was a fixed rate set for all.
The Fair Play Fair Pay Act and Why It Matters
Back in 2017, a group of lawmakers introduced the Fair Play Fair Pay act. They intended to make sure that artists and the rest of the rights owners get their fair share for their work no matter how it’s used. This, of course, includes royalties derived by traditional and internet radio stations.
The FPFP act demanded that there should be a fixed amount to be paid by traditional and internet radio stations (such as Pandora or Spotify) to the artists and rights owners. The amount they decided upon was $0.70 per hundred plays for the ones who listen to stations with advertising and $0.22 per hundred plays for the ones who pay a subscription to the service.
Trying to set uniform statutory rates is a noble cause. Unfortunately, we have seen a significant improvement in rates just yet. Hopefully, we will experience significant improvement in the near future.
If Artists Don’t Earn Public Performance Royalties, Why Are They so Interested in Getting on the radio?
With one word? Exposure. Record labels and artists use traditional radio as a promotional tool to get more exposure and more fans. They hope this exposure will give them all sorts of benefits such as collaborations with famous artists, new gigs, and appearances on TV and shows. They also aim to sell more merchandise, CDs and generate more streaming plays.
Do This and Get Your “Radio Money.”
- Songwriters and music creators get their royalties from performing rights organizations (PRO’s).
- PRO’s are companies that collect Performance royalties on behalf of the music creators. They don’t collect synchronization, mechanical, or digital performance royalties.
- Public performance royalties are royalties that are paid whenever a song is played in public. This, of course, includes radio, TV, commercials, bars, and restaurants.
- After the PRO has collected the royalties, it is their job to distribute them to the right people; typically, those are songwriters and publishers.
At this point, its good to know that there are four major performing rights organizations in the US.
- ASCAP (American Society of Composers, Authors, and Publishers)
- SESAC (Society of European Stage Authors and Composers)
- BMI (Broadcast Music, Inc.)
Follow These Steps to Ensure You Get Paid Your Radio Royalties: The SLOW DIY Way
Step one- make sure you become a member of ASCAP, BMI, or SESAC. It doesn’t really matter which company you will choose the price is about the same and what they offer is about the same. However, SESAC is a bit difficult to get in since it’s by invitation only.
I would choose BMI, which is free for all songwriters. Music publishers, however, have to pay $150.
Step two- get an ISRC code for each track you want to send to the radio. You certainly need this code to help radio stations recognize you as a legitimate owner of the track.
Here is a quote from Wikipedia about the ISRC code:
“The International Standard Recording Code (ISRC) is an international standard code for uniquely identifying sound recordings and music video recordings.”
Step three- if you’re planning on releasing CDs and permanent digital downloads (think of iTunes), then you need to encode the ISRC codes on CDs and MP3’s. The CD manufacturer or the mastering engineer can help you instill the ISRC code for physical releases. And for permanent digital downloads, you can use software such as KID3 to insert the ISRC code.
The QUICK Way: Use a Music Distributor
If you don’t wish to go through this process manually, you can simply register with a distributor that arranges the whole process for you.I recommend either CD Baby or Distrokid.
Here is what these companies had to say about the ISRC code:
1) Talking about the ISRC Code: CD Baby
“When you order with CD Baby, we will assign individual ISRC codes to each track of your AUDIO CD (unless you provided your own codes or asked us not to). You can view the ISRC Codes we assigned to your tracks through your online account.”
2) Talking about the ISRC Code: Distrokid
“An ISRC code is a unique code assigned to each song you upload. DistroKid will automatically generate new DistroKid ISRC codes and associate them with every song you upload. It’s free and automatic and you don’t have to worry about it.”
I hope you found this article helpful and informative! 🙂