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SONGWRITER INCOME

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Royalties -- SMP Hot Links Supreme Join SMP
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Any income received by a songwriter. Incomes may include wages (e.g., from an employer such as a music publisher where the songwriter is a work for hire employee), flat service fees (e.g., for composing a jingle), or royalty income. A songwriter may receive royalty income by exploiting any of his rights in copyright via charging fees for various licensings. These fees are usually shared with and collected by various agents with whom the songwriter is affiliated.

For example, the songwriter's music publisher would collect and share certain licensing fees defined in his songwriter/publisher contract. Most of these incomes are divided in a 50-50 split of the "gross" that remains after the publisher deducts a 5-20% off-the-top administration fee. These license fees may include merchandising license fees, compulsory license fees, purchase license fees, transcription license fees, mechanical license fees, synchronization license fees, grand rights license fees, advertiser use license fees, print license fees, foreign publishing license fees, and others.

Also, the songwriter's performance rights society would collect and share all performance license fees (usually a 50-50 split of the "gross" after the performance license society/collector/agent deducts a 15-20% off-the-top administration fee).

Other agents will also be involved and take their cut and then pay the songwriter's music publisher who takes an administration off-the-top cut before paying the songwriter who in turn may pay other co-writers according to their split agreement.

As you can see, each right that is assigned via a license involves one or more middlemen taking their cut of the income ahead of the songwriter!

And, to make it even more complicated than just having multiple agents issuing and collecting incomes on multiple licenses, sometimes one agent may do one licensing while another might do multiple licensings, while another agent monitors and audits those agents!

For example, the songwriter's income from mechanical licensings, synchronization licensings, and all foreign licensings, might be handled by the Harry Fox Agency, while his performance licensings are being handled by BMI, while his folio licensings are collected by his music publisher, while his merchandising licenses are handled by his publicity and promotion agent, while his juke box licenses are monitored by the Copyright Office, while his domestic mechanicals and controlled compositions are handled by his label, while his songwriter association audits his music publisher, while his attorney audits his label and other agents, while his CPA audits his attorney and while the IRS smiles down from above auditing everybody under the sun! And so goes the music business.

See Cross-link: SONGWRITER ROYALTIES, MUSIC PUBLISHER, INCOME under "Gross Income," ROYALTY, TAX LAW, CONTRACT-SONGWRITER/PUBLISHER CONTRACT clauses #22, #23, #24, COPYRIGHT LAW under "Compulsory License Fee."

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