Mechanical & DPD
A Mechanical License is required when a label wants to release a song on a CD. If they want to release the song digitally (i.e. iTunes, etc.), a Digital Phonorecord Delivery License (DPD) is required.
The royalty rate for this type of use (better known as the statutory rate) is set by the Library of Congress, and is currently:
- $0.091 per song sold (for songs five minutes and under)
- $0.0175 per minute (for songs over 5 minutes long), rounded to the next minute.
Example: a song timing of 5:01 would round up to 6 minutes, resulting in a rate of $0.105 per song sold (6 x $0.0175)
Streaming Royalties are generated when songs are released to streaming services (Apple Music, Spotify, etc.)
These royalties are paid “per-play” at varying rates (usually less than $0.01 per stream) and is calculated using a percentage of the streaming service’s revenue, divided proportionately amongst the songs streamed on that platform.
A Synchronization License is required when a song is placed onto an audiovisual use (in a TV show, music video, movie, etc.). This is licensed and paid by the production company of the audiovisual use, usually in a lump sum. This payment is negotiable, depending on the songwriter’s bargaining power.
In a synchronization use, both the master copyright & the publishing copyright must be licensed, which means more money for those who self-publish & own their own masters.
When a song is broadcast in a public medium for public consumption (on the radio, in a commercial, at a concert, in a restaurant, etc.), Performance Royalties are generated.
These royalties are licensed & paid to Performance Rights Societies (PROs), who then pay the writers and the publishers. The PROs in the US are:
(NOTE: You can only be affiliated with one of them at a time.)
Whenever your song is sold as in print form (lyrics, sheet music, etc.)