How to Legally Secure the Mechanical Licenses for Your Cover Songs

October 18, 2011{ 17 Comments }

[Loudr helps you obtain the required mechanical licenses for cover songs without expensive lawyers or complicated paperwork.]

Why is licensing necessary?

Just like you need a license to drive a car, fly an airplane, or sell real estate – it’s the law! Copyright Law requires artists and labels to obtain a mechanical license before distributing a recording containing any song/composition they didn’t write.

What’s a mechanical license?

A mechanical license is a broad term that refers to the reproduction – for distribution or sale – of a musical composition in the form of a sound recording. Any time you reproduce and distribute a recording of a composition you do not control – including through physical and digital means – you need a mechanical license. Mechanical licenses are issued by the owner or controller of the composition in question. Typically, these are publishers acting on behalf of songwriters or composers. Some agencies represent many US publishers for mechanical licensing, although there are US publishers who are not represented by agencies and must be licensed directly.

Who gets the money?

There are two fees involved with licensing cover songs through Loudr – the $15 per license service fee (which is discounted if you’re securing licenses for multiple songs), and the publishing royalties. The publishing royalty is a statutory rate set by law at 9.1¢ per unit for all recordings up to 5 minutes, and 1.75¢ per minute if a track is over 5 minutes in length. Loudr pays out all royalty fees to the respective song- writers and/or publishers for the composition(s) for which you are receiving a mechanical license.

How does this work for physical CDs?

For each physical CD manufactured that includes the cover song material, the royalties owed correspond to the statutory rate of 9.1¢ per pressing per song. For instance, if you were to manufacture 1,000 CDs of an album containing two cover songs, the royalties owed would be $182 (1,000 CDs x 2 songs x 9.1¢ per song).

How does this work for digital?

The same statutory rate that applies to physical CDs also applies to digital downloads (also known as DPDs). For digital downloads, the royalties are calculated on the actual amount of downloads. For instance, if your album included 2 cover songs and was downloaded 500 times, the royalties owed would be $91 (500 album downloads x 2 songs x 9.1¢ per song). Additionally, if your cover songs are available as singles, the same rate applies to all downloaded single tracks of the song.

What if we don’t plan to sell the CDs?

If you are giving away CDs, downloads, etc. you will still need a mechanical license and will be required to pay mechanical royalties for all physical units manufactured and all digital units distributed.

What does public domain mean?

The public domain generally includes works that are ineligible for copyright protection or whose copyrights have expired. Songs or musical works first published in 1922 or earlier are in the public domain in the U.S.

How do I figure out if a song needs a license?

PD Info Online is a good starting point to determine if a song falls into the public domain.

Can a mechanical license be withheld? Can a copyright owner decide they don’t want their work available to be recorded by anyone else?

Under Section 115 of the Copyright Act, anyone is entitled to record a song which has already been released publically by another artist, irrespective of a copyright owner’s permission. This type of license is referred to as a compulsory mechanical license, and is obtained by submitting to the copyright owner a Notice of Intent to Obtain a Compulsory License and abiding by Section 115 licensing and accounting regulations.

What constitutes a “copyrighted arrangement” for a song in the public domain?

A copyrighted arrangement consists of a version of a public domain song including changes or alterations with at least a minimum amount of creative musical expression. Sometimes, this can be difficult to determine. An excellent rule of thumb: if you used sheet music to learn it, you can find the copyright information there.

Is it legal to change the lyrics to a popular holiday song (or any song) and record our “revised” version? How would we go about getting permission to do something like that?

Changing the lyrics to a song constitutes a derivative work, which requires direct permission from the music publisher. If you are interested in contacting a particular publisher for permission to record a derivative work, songwriter and publisher contact information can often be found by searching the song databases on ASCAP, BMI, or SESAC’s websites.

Legally secure the mechanical licenses for your cover songs with Loudr.

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  • Larry Killip

    Last time I looked though..only for US artists.

  • Generally, streaming services pay mechanicals on behalf of artists. But I'm no lawyer, so you'd have to check with the publisher or cover song clearance agency that you're working with to be sure for your case.

  • Probably so. But, to be sure, check with the publisher you've already paid royalties to.

  • Jane Allie

    Thanks for this! I found this because I've been wondering about this for cover songs my bands wants to post to YouTube and I want to make sure we're all legal. A lot of people I know in bands don't really do this. I also read that Rightsflow just got bought by Google to help them with songs used on YouTube. This clears up a lot — all this copyright and licensing stuff gets pretty confusing. This article (though it's a little older) also helped a lot, and I figure it might help others looking for this info too:

    • Cool. Glad to help. Thanks for the link to the other article, too.

  • Bob

    what if your going to add the song to face book for free downloads do u need to pay for each time someone downloads the song off it?

    • Yes. You still need mechanical licenses ("DPDs" if you're doing digital) for free giveaways.

  • That's a good one for a legal expert, as I'm not exactly sure what kind of license you need to acquire in order to stream a cover song for free. But I know you do need to get a license or permission of some kind.

  • That would probably differ depending on the type of deal you have with the record company. My suspicion is that the label, if they're funding the project and handling accounting and royalties, would be responsible for dealing with all the mechanical payments too.

  • Hi Amy,

    I'd suggest contacting the folks at Limelight ( and they can guide you through it. They're the experts, so they'll be able to give you the accurate info on international mechanical licensing.


  • kerrileesmith

    What if the derivative work is only for performance, not for a recording? Do you still need a license?

    • That is a great question. I have no idea, legally speaking, but I’m pretty sure you’re safe to perform that kinda thing live.


  • Probably so. Limelight wants to know the time because if it’s over a certain length, the rate goes up. So best to give them the final time count. As far as tracking downloads, you should be able to view download sales per song in your members accounting section. If you have trouble, give us a call. I’d say start with the minimum licenses (if you don’t know how much it will sell) and then just renew when you approach that number.


  • Ha, I wish. They’ve already been purchased by a little-known company called something like… Google.


  • We don’t allow cover songs in our sync licensing program because the catalog of songs needs to be pre-cleared, meaning you have all the rights to grant the sync license. In the case of cover songs, you have the right to license the sound recording, but not the composition itself — which means if someone wanted to license that song, they might get held up trying to get permission from that songwriter/publisher.


  • It is, yes. But if you’re concerned about YouTube monetization, we wouldn’t be able to collect your ad revenue for cover songs anyway, because the rights holder of the composition (songwriter/publisher) will have most likely issued a 3rd party content claim on your cover song videos.


  • The giant gray area here, which makes it difficult to find a scalable solution for 350k artists who record music from all over the world is that cover songs on YouTube aren’t legitimized with a simple mechanical license. Every video (technically) needs a sync license (negotiated between writers, publishers, and the creator of the video). I know the reality is that most artists on YouTube are NOT getting sync licenses before posting cover song video. Lots of publishers/writers are happy to share in ad rev through content ID. However, many are not. And getting flagged for such a violation would be bad news for the future of any service that allowed artists en masse to monetize cover song videos. I totally see the value of what you’re suggesting, and we have been talking about this kind of solution, but it’ll take time, if it happens at all. We’re not like a typical music MCN where the affiliated artists can cover popular songs from a pre-cleared list of tunes without worrying about legal stuff. The size of our catalog (and the international scope of it) makes YouTube cover-song clearance a little trickier.