Show Me the Money!

  I’m often asked by fans what is the best way to purchase or listen to music in order to ensure that the songwriters behind it are being paid fairly. After all, if you love a particular songwriter or artist, it’s the best way to make sure they’ll be able to continue doing what they do so you get to hear more of it!

The music royalty system is complicated, so it’s not surprising that many people have no idea that there are “good ways” and “bad ways” to consume music when it comes to where the dollars go. So I'd like to post an outline of what I know about this subject;  just something to keep in mind when you’re making choices about how to listen.  Here are the rankings, from best to worst, of different ways to consume music when it comes to supporting the creators behind it:

1. ONLINE SUBSCRIPTION-BASED SITES LIKE KO-FI or PATREON

How Much We Earn: Your pledge, minus Paypal and platform fees ($5/mo on Ko-Fi, 5% on Patreon)

These new sites allow fans to pledge a monthly tip to their favorite songwriters in return for exclusive access to content that isn’t available anywhere else. (For example, on my Ko-Fi page, supporters who tip $4 per month have access to unreleased songs, voice memo recordings of the original song ideas, guitar/vocal “worktape” versions captured immediately after the songwriting session, etc.) These pledges generate a monthly income stream for songwriters, helping pay their bills and allowing them to focus on creating future content.

2. CONCERT TICKETS & OFFSTAGE MERCHANDISE SALES FOR PERFORMING SONGWRITERS:

How Much We Earn: The profit, minus any venue and/or management commission

Buying a ticket to a performance or merchandise from a performing songwriter in person ensures that most of your music dollars end up in their pocket. If the songwriter is a performing artist also signed to a label, they generally purchase their own CDs from the label for a few bucks each and mark them up for resale. Indie songwriters will have paid for the recording project out of pocket in the first place, so they’ll put your dollars back towards the debt they incurred in the recording and printing process. (An indie songwriter album generally costs $10,000 to $20,000 to make, which includes studio time, musicians, mixing, mastering, photography, graphic design and printing/distribution costs.)

2. RADIO:

How Much We Earn: depends on chart ranking

Terrestrial and satellite radio royalties are the bread and butter of non-performing professional songwriters. There’s no easy answer to what a hit song earns, because it’s based on a per-capita weighted split of collected radio tariffs each year, but in country music I’ve seen Top 20 country radio hits earn around $30,000-$60,000, Top 10 hits earn around $100,000-$200,000 and Number 1 songs earn as much as $500,000 in total songwriter share (which is split among all the writers and publishers involved in the song). In pop, there’s a lot more of a payout than that. For Canadians reading this, since Canada’s population is 10% of the USA’s, radio hits pay about 10% of the U.S. numbers. And of course earning this money as a songwriter requires having your song selected as a radio single, which only happens to a couple of songs per album released, and even for the luckiest of us this usually only happens a couple times in our entire career!  But listening to the radio, whether it’s your local station, satellite radio, or terrestrial radio stations that stream online (such as iHeart Radio), supports the songwriters behind the music you hear.

3. IN-STORE CD or ONLINE PURCHASED DOWNLOAD (eg. iTunes, Amazon):

How Much We Earn: 9.1 cents per copy sold

Most people have now moved to different ways of consuming music, but if you purchase a CD in a store or online in the USA, that generates 9.1 cents per song as the songwriters’ share. This number is then split between the songwriters and their publishers, so a song written by two professional songwriters with publishing deals would generate each writer 2.27 cents per copy sold. (Having a song on a platinum record – 1 million copies sold – would therefore generate $91,000 in songwriter revenue to be split among writers and publishers…however, records almost never sell that many copies anymore.  And in Canada, record sales are generally 10% of what they are in the USA due to the difference in population.)

4. STREAMING SERVICES:

How Much We Earn: about .00008 of a penny to .05 of a penny per stream

Streaming services are known for their pathetically poor songwriter royalty rates. Each pays a percentage – an unbelievably LOW percentage – of their revenue, and outdated legislation in the USA forbids songwriters’ Performing Rights Organizations to change this rate. This is something songwriters are fighting like crazy to change, and the fact that this has become the main way of consuming music is causing the extinction of songwriting as a career choice, with most of us having to rely on doing other jobs (teaching, touring/performing, waiting tables, driving for Uber, etc.) to keep food on the table. With a revenue percentage, there’s no way to do the math for a specific answer on what a stream pays. But in general, it’s in the vicinity of 0.00008 of a cent to 0.05 of a cent per stream. So a MILLION streams of a song might earn the songwriter somewhere around $500. That means that you can write the biggest hit song in the world - a song that will generate a huge chunk of change for the streaming services, the label, the artist, the producer, and on down the line - but by the time those remaining fractions of pennies reach the person that wrote the song, they won’t add up to a livable income.

But let's face it, streaming is here to stay, and it's convenient.  One way to make yourself feel better about doing it - besides also supporting the songwriters whose music you consume in one of the other ways listed above - is to make sure you're streaming through one of the "good guys".  Here’s how some of the most popular streaming services measure up from a songwriter perspective, according to a performing rights representative I talked to recently. They all pay within the range above, but some more than others:

Good guys: Apple Music, Tidal

Bad guys: Rhapsody, Pandora, Spotify (the most uncooperative when it comes to songwriter rights)

5. FREE DOWNLOADS:

How Much We Earn: nothing!

OK, so as attractive as those free downloads look – you know, the ones you find in a Google search advertising “free MP3s” or “file sharing” or “torrent” files – please think before you click on them. Those not only pay songwriters zip, but they’re also illegal. So basically, they're bad for everybody involved (except the criminals who are using them to benefit from advertising dollars).

I hope this info is helpful to music lovers out there! If you enjoyed this post, please consider buying me a coffee here: