Are You Getting Paid Everything You’re Owed from Spotify?

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Am I getting paid everything I'm owed from Spotify?Have you collected all the royalties you’re owed from streaming services like Spotify and Rdio?

If you don’t have a publishing administrator working on your behalf, the answer is probably NO. But I should make it clear upfront that this isn’t Spotify’s fault. It’s not like they’re holding out on you! It’s just one of those crazy things about how the world of music publishing works (or doesn’t) for indie artists. But don’t despair — CD Baby Pro offers a simple solution to this problem! (More on that later).

So which monies have you been missing out on? Read on to find out…

Four ways you can make money through Spotify

1. The regular ‘ole payment for the stream —

Some folks call this a “master use royalty;” others call it the “artist royalty;” technically, it’s a payment for streaming your licensed sound recording. If you’re distributing your music through CD Baby, it’s the money you’re paid by Spotify each time your music is streamed. You’ll see a complete report of streams and payments in the accounting section of your CD Baby member’s account.

2. Mechanical royalties —

Services like Spotify, Rdio, even YouTube, owe you a mechanical royalty every time music you’ve written is streamed. Sadly, mechanical royalties generally aren’t paid directly to independent songwriters — but to agencies like HFA (in the US). If you have a lot of plays on Spotify, those royalties are adding up AND going uncollected — unless you have a publishing administrator working on your behalf.

With CD Baby Pro, we’ll act as your publishing administrator and make sure you get paid all the publishing royalties you’re owed — both mechanical royalties for global streams and international downloads, as well as performance royalties for the usage of your music on radio, TV,films, in live venues, etc.

For more info about what mechanical royalties are, click HERE.

3. Performance royalties — 

If you’re registered as both a songwriter and publisher with a performing rights organization such as ASCAP or BMI, then you’ll receive these royalties through them for any Spotify plays.

If you’re not already registered with a performing rights organization, check out CD Baby Pro. We’ll affiliate you as a songwriter with ASCAP or BMI, register your songs with collection societies around the world, and make sure you’re set up to collect all your publishing royalties.

For more information about what performance royalties are, click HERE.

Publishing Guide: Get Paid the Money You Are Owed

4. Performance royalties for the master recording — 

Traditional music publishing deals with the song itself (on behalf of the songwriter and music publisher) — NOT any particular recording of that song. So what about the people who own the sound recording that is actually getting played? That’s where a company called SoundExchange comes in.

SoundExchange is now authorized to collect performance royalties on behalf of the people who helped create a particular sound recording – including session players, record labels, etc. Spotify pays these kinds of performance royalties to SoundExchange for “non-interactive” plays via Spotify Radio (though NOT for on-demand streams).

To collect them, register with SoundExchange today.

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If you’re more of a visual learner, check out our infographic, “How CD Baby Pro Collects Publishing Royalties from Spotify.”

How CD Baby Pro Collects Music Publishing Royalties from Spotify

To make sure you’re getting paid all the publishing royalties you’re owed from streaming services like Spotify, Rdio, and YouTube, sign up for CD Baby Pro today.

Publishing Guide: Get Paid the Money You Are Owed

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  • Yes, we're working now on making CD Baby Pro an international program. Not exactly sure how long it'll take. But hopefully "soon."

    @ChrisRobley

  • Great to hear that, Chris.. I look forward to it 🙂

  • Any plans to roll this out for UK artists anytime soon? (CD Baby Pro that is)

  • Pingback: How CD Baby Pro Collects Music Publishing Royalties from Spotify DIY Musician Blog()

  • Thanks for posting this clear diagram. It's nice to visualize this instead of just reading about it!

  • If you want performance royalties from streaming services, yes — but not all the royalties are covered by PROs. Are you currently set up to collect mechanical royalties? (Because Spotify pays those too).

    Check out our infographic for more details: http://diymusician.cdbaby.com/2013/06/how-cd-baby

    @ChrisRobley

  • Giuliano Vangelis-ta

    Hi! So, in simple terms, if I want the streaming cash I must subscribe to the national Performance Right Organization, so if I’m Italian I have to subscribe to SIAE, do I get it?

  • 3 Theory

    What happens to the money HFA collects if the artist/songwriter isn’t signed to a major publisher? I just looked on HFA’s website and in order become affiliated with them you have to meet a bunch of criteria which excludes all self-published artists (they specifically exclude CDbaby as being a qualified “commercial release”).

    Quoting a response from them via email:

    “One of your songs must be commercially distributed within the past year by a US record label other than your own. Songs released on your own record label do not qualify. Self released recordings through online services such as Tunecore, CD Baby, Musicadium, Nimbit, ReverbNation and Songcast do not qualify.”

    How is it legal that a company can collect mechanical royalties on behalf of an artist and then outright refuse to pay them directly? And if HFA doesn’t collect mechanical royalties for artists they aren’t affiliated with then who does Spotify pay?

  • So, if you’re signed up for CD Baby Pro, we’d be able to collect that money for you. The issue is, HFA doesn’t want to deal with individual musicians, so they work with big labels, big publishers, and publishing rights administrators (like CD Baby Pro). But I will say their response is a little bit [put adjective here] as far as their stance on what constitutes a qualified “commercial release.” We’ve been in the age of the indie for over a decade now.
    Anyway, long answer short: this problem is solved by CD Baby Pro!

    @ChrisRobley

    • 3 Theory

      Hey Chris,
      Thanks for your quick reply. I am a indie artist, have my own label with a few other artists on the roster. CD Baby Pro definitely has benefits but I’d still like to know where Spotify sends their mechanical royalties if HFA isn’t affiliated with that artist?

      Does Spotify then keep the mechnical royality monies or do they send it somewhere else or does HFA just collect it all and hold on to it until every artist in the world gets a major record/publishing deal?

      I’m just not understanding why there has to be two middle men (Spotify > HFA > CBP > Artist) between content consumer (Spotify) and content creator (Artist).

  • iamthegif

    Ok, just trying to get something clear here. If I’m the performing artist and the writer and I release the song through CDbaby myself, Spotify owes me mechanical royalties in addition to what I’m paid by CDBaby per stream? I said “in addition to” because I’d like to know if that money comes from my per stream payout & I’m effectively paying myself for the right to use my own music. Thanks.

  • No. The mechanicals are not wrapped up in your per-stream payout (what we call the streaming license fee). The mechanical royalty is a separate payment, which we can collect for you if you’re signed up with CD Baby Pro. Spotify pays that to Harry Fox Agency; then we’d go to HFA to collect on your behalf, representing you as a publishing rights administrator (since HFA doesn’t work directly with artists).

    @ChrisRobley

  • They send mechanicals to HFA. But you’re correct; HFA won’t pay them directly to indie artists, which is why you need either a 1) major label, 2) giant publisher, or 3) a publishing rights administrator to act on your behalf. CD Baby Pro, as a rights administrator, can collect those royalties for you.

    As for the need for middlemen, it pretty much comes down to HFA not wanting to work with individual artists. So CD Baby Pro has a kind of “power in numbers” ability to collect royalties for artists.

    @ChrisRobley

  • Jesse Cochran

    So let me get this straight…I don’t know if I’m reading right, but if I don’t have CD Baby Pro, then I get NONE of the money?!!!

    • With CD Baby Standard you’d receive the normal revenue from CD and download sales, as well as streaming activity, YouTube ad revenue, and sync money (for the master recording).

      CD Baby Pro helps you collect publishing royalties, including mechanical royalties for international downloads and global streaming (royalties which you would not be able to collect without a publishing rights administrator working on your behalf).

      Does that make sense? Let me know if you have any other questions.

      @ChrisRobley

  • Ozzed

    How often does spotify report to CD-Baby? It’s now a new month and I know I’ve had streams in May but yet my balance says ZERO now (on June 2nd).

  • Spotify reports to us monthly, BUT the report you receive in June will likely not have May streams on it. Many of our digital partners report 1.5 months after the close of the month in which the download or streaming activity took place. For instance, if you sold a track on iTunes on April 2nd, you wouldn’t see the report until June. Feel free to write cdbaby@cdbaby.com if you have any accounting questions.

    @ChrisRobley

    @ChrisRobley

    • Ozzed

      Thanks for your reply 🙂 I’ve had my music online on spotify since April 10th, but when I click on “DD Sales (By Partner)” it says “There is no data available for your request.”. Is it that the report isn’t generated exactly June 1st? Because if I understand you correctly I should at least be seeing April streams in the report for June, but I see no report at all.

  • No, it’s about 45 days after the close of the month in which the sale/stream took place. So a stream from April 2nd would most likely be accounted for in the June report (which we’d get in mid-June).

    @ChrisRobley

    • Ozzed

      Awesome, thanks 🙂 Now it makes sense.

  • If you were to let your SoundExchange royalties go uncollected because you hadn’t signed up directly, CD Baby would collect them for you and take a small cut. But I would recommend just signing up directly with SoundExchange. That way the artist share of those royalties will go right to you.

    Please follow me on Twitter, Instagram, Facebook, YouTube, or Spotify.

  • Danielle

    Thanks for the info, Chris!

  • Danielle

    Thanks for the info, Chris!