These are really advancing on royalties that have to be repaid out of incoming royalties. Once your catalog is recouped, the publisher pays you semi-annual royalty checks for money they have collected. This part can be taken as the “bonus” in business world. Basically, the more you write, the bigger your catalog would be, and the bigger your catalog is, the more semi-annual royalties will come to you.
Sync Royalties. These are fees paid by TV and radio stations, movie studios and advertisement agencies to use your song. There are a million different ways these would work, and they can be very small ($50) or huge (hundreds of thousands). It’s totally depending on where your music is placed. If it’s in a Coca-Cola advertisement in national TV, you can expect something around one million dollars. And if it’s on a cheesy advertisement for a mobile application to be posted on YouTube, you can expect around $50. I personally know people who only and only write background music in a typical genre that is being used in most of television advertisement and they are solely relying on that. It seems like a small amount of money but in a long run, it’s pretty decent and the chances for this is not bad because the competition there is not as big as the rest of the music industry, simply because nobody would become a “star” writing instrumental music for background of an advertisement.
Mechanical Royalties. Generally, these are royalties on something that someone purchased. We can call it the writer’s share of the sales from the product. A downloaded song, a CD, a Vinyl Record, etc. Same as any other products, when someone invent it and someone else produce it for the mass market, the inventor will earn a certain percentage for each time that product is being sold. In our case, the inventor is the songwriter, the manufacturer is the publisher and the percentages are the mechanical royalties. The mechanical royalties in fact is not limited to the sales alone. For each time the song is being played on streaming platforms like Spotify or Apple Music, there is a mechanical royalty fee going to the songwriter or even if the song is being reproduced by another artist – which must be done with legal permission of the writer or the publisher or whoever owns the rights – there will be some more mechanical royalties for the original writer for each time the new version of the song is being sold or played on streaming platforms. Same goes even to when someone records a cover version of the song.
Performance Royalties. These are royalties from radio and TV airplay and any other sort of public performance of the specific songs, including concerts. The sync fee is a licensing fee to use the song and the performance royalty is fee for the song per play or per time played on radio, TV, or concerts. The amount of these royalties is depending on the audience scale of the public performance. For example, when your song is being played in a national TV or radio channel, you get paid much more than a local channel with more limited audience. Or if your song is being performed by any performer – even including yourself – in a concert, let’s say in a arena concert, the Performance Royalties are much higher than the same song being played in a high school prom! Even if your songs are being played in airplanes, hotels or malls as background music, it is considered as public performance and you will get paid for it. In fact, for me, I can say one of my biggest sources of fixed income is from my solo piano albums being placed in the playlists of some hotels. They play it in their lounges, and I get paid for it. Also, a lot of songs I have written for pop artists are constantly being played in bars and pubs and my PRO is paying me for each time each of my songs are being played in each of these venues. All the Performance Royalties are supposed to be collected by PRO’s and to be sent to you or your publisher on a semi-annual basis.
PRO’s – (ASCAP, BMI, COMPASS and SESAC). All of performing rights organizations collect performance royalties and pay you quarterly, in COMPASS’s case semi-annually and in SESAC’s case, monthly. All you need to do is to keep your PRO updated when you have a new song and register your songs with them. They will have forms for your registration which you have to indicate the details of the song and the credits. When you register the song with PRO’s, it will be in their database and all PRO’s around the world are connected to each other. So, let’s say you are in United States and you have registered your song with ASCAP. When your song is being played in Singaporean radio, Singapore’s PRO, named COMPASS will collect the royalties from the Singaporean radio station and pass it to ASCAP and ASCAP will process your payment. Same goes when your song is being played in a concert in Hong Kong, then CASH will collect the fees and send it to ASCAP. You got the idea!
This was some of the regular sources of income for a songwriter in a nutshell. So, for conclusion, as a writer, you would get a regular monthly cheque from your publishing advance. You will get quarterly or semi-annual cheque from your PRO. You will get semi-annual checks from the publisher which your catalogs with them that have recouped. It’s a crazy system and very unpredictable, but that is how it works. Basically, the only stable income for a writer is the publishing draw. That’s the only one you can predict from check to check. Hope the next time someone gets confused on “How songwriting is a real job” you can answer them!