Music royalties collection & payment organizations US

[3Seas]

Am I correct to understand in the US there are three different organizations (not requiring being invited) to cover the spectrum of Music Royalties collection and payment?
How does each cover a different part of the music royalties spectrum? Is there overlap?
Also am I correct that it's possible to be a member/registered of all three at the same time?

1) PRO (BMI or ASCAP)
2) Sound Exchange
3) Mechanical Licensing Collective (MLC)

Just trying to see the main trees in the forest.

[RPaul]

Am I correct to understand in the US there are three different organizations (not requiring being invited) to cover the spectrum of Music Royalties collection and payment?

More or less. I would call it three categories of organizations, rather than three organizations. For example, in the PROs category, there are 4 organizations (ASCAP, BMI, SESAC, and GMR), albeit only 2 you can join without being invited or at least being approved to join (ASCAP, BMI).

There are also some other organizations that deal with various sorts of royalty collections and payments, some of which you can join without being invited. For example, there is the Harry Fox Agency, Music Reports, and probably others I'm not thinking of at the moment.

How does each cover a different part of the music royalties spectrum? Is there overlap?

The three specific areas you list do not have overlap, but there can be overlap with some others. More thoughts on that below.

Also am I correct that it's possible to be a member/registered of all three at the same time?

Yes.

1) PRO (BMI or ASCAP)

These, along with SESAC and GMR, are performance rights organization and specifically collect performance royalties on behalf of songwriters and publishers (including self-publishing songwriters). A songwriter can only be a member of one PRO, and any publishing entity associated with that songwriter's publishing share must be in the same PRO as that songwriter. An organization-evel publisher can be affiliated with multiple PROs, but will have different named publishing entities for each PRO. Some PROs, such as ASCAP, do require that there be a named publishing entity to collect the publishing share of the royalties, while others (at least BMI) will pay the songwriter the publisher's share if there is no named publisher.

Performing rights include radio play, streaming, other broadcast sources (e.g. TV, satellite radio, etc.), and live music (e.g. in bars, arenas, etc.) -- I may be forgetting some other possibilities.

2) Sound Exchange

SoundExchange is the exclusive organization to collect performance royalties for recordings, which they are collecting on behalf of record companies, recording artists, and certain musicians who may be involved in the recording. If you own both the recording copyright and are the artist on the recording, you may have both copyright owner and artist memberships (and there can also be musician payments through unions for a certain share of the royalties).

These collections are for non-interactive digital performances, which could include satellite radio and non-interactive streaming (e.g. Pandora Radio). Most notably, they do not include terrestrial broadcast radio, as US terrestrial radio stations do not currently pay royalties for the recordings they play (they only pay royalties for the songs behind those recordings).

3) Mechanical Licensing Collective (MLC)

The MLC is a new organization (started collecting last year) that specifically collects mechanical royalties for interactive streaming and downloads for music ISPs that want them to do it (some may cover this in other ways). They collect for songwriters and publishers, but, unlke the PROs, only pay publishers (including self-published songwriters). So, if the publisher and songwriter are separate, the MLC pays the publisher, and the publisher will need to pay the songwriter the writer's share. This can come into play if using an administrative publisher (e.g. CD Baby Pro) since the collections would go down that route.

Besides these three organizations (and I'm a member of ASCAP, SoundExchange, and the MLC), some other organizations that come to mind include Music Reports and the Harry Fox Agency, though I'm sure there are others that aren't coming to mind. HFA historically was one of the main organizations for administering and collecting U.S. mechanical royalties for publishers (and, indirectly, songwriters), and they are still one of the main organizations that collects mechanicals for physical product (e.g. CDs, vinyl), though HFA also covers other territory nowadays, and I believe they have some international relationships, though I'm not clear on what all they do (I'm not a member). If you were using the HFA for your mechanicals, they'd likely be the one getting the payments from the MLC and would pay you your share from those collections.

I'm not 100% clear on all Music Reports does, despite being a member. They license for various types of uses (e.g. karaoke, exercise equipment, etc.), and they've also licensed to the streaming and interactive services. Most of my payments from them have come from Amazon Music (we're typically talking penny levels, but they are weird in that they have sent me checks that have less value than the postage used to mail them), and I've seen TikTok appear in my reports from them, too. Maybe they're overlapping with the territory the MLC now covers for organizations that use them. I think they were a main organization that covered this base prior to the introduction of the MLC as I also used to get payments from them for Groove Music (Microsoft's former music ISP).

In the case of Music Reports, I have no clue how I initially encountered them, but they handle clearance and collections for publishers (including self-published songwriters)

[3Seas]

Thank you RPaul and Telefunkin. you have helped me understand I should just start with a Pro and depending on future happenings additional others, where allowed and beneficial.

I've been digging into this and the terminology used in different ways can be confusing.

So there are Production Music Libraries, Sync Agencies, and Music Publishing Companies. (again more in the spectrum but these I understand are the main ones.)

Of course given the Taxi listings, depending on the specific listing, any one of these may be the relevant business model to that listing.

My initial confusion came in due to Music Production Libraries providing instrumental music and lyrical song for sync to visual productions as TV shows, Commercials, Movies, etc.
Sync Agencies do the same thing but there are differences.

The difference, as I understand it, is Music Production Libraries deal with Composers and Songwriters whereas Sync Agencies deal with Artists and Bands. Not that musical creative talent can't span across these two, but I'm perceiving the difference is the nature of the talent's intent. I suppose saying it's like the difference between "unsung hero" and "limelight hero."

But then there are the Music Publishing Companies who primarily deal in the "Limelight Heros" the artists and bands preferably with a well-defined genre they stick with.

Back to the beginning:
For confusion fun, let's give each business model a non-pure primary color, elementary school style, Red, Blue, and Yellow. Mix them up to get a gray mess, or is that brown? and call it "Production Sync Publishing" <sounds fitting.
For additional confusion fun let's mix in different kinds of, elementary school style, flour to make it contract paste so as to stick together legalese, to get paid.

But at last, I'm now graduated from elementary school. Now in Jr. Highschool.

Now that I know it is possible to be a member of a PRO, Sound Exchange, and MLC at the same time, does or can a contract with a Music Publishing Company have an effect on the usefulness of any of the three memberships?

Edit to add this clip which was just posted to Twitter https://www.youtube.com/watch?v=xc6T0XC ... e=youtu.be The four food groups of Royalties.
So regarding Production Music Libraries, is it performance or sync, or how does this play out?

[RPaul]

If you're just dealing with music libraries, for example composing, or even songwriting, for the libraries, where they represent both the songs/compositions and the recordings, probably the only thing you need to affiliate with is a (songwriting) PRO, in order to collect the writer side of any performance royalties. The library will deal with everything else and give you whatever your share of that may be. The original question didn't mention context, so my answer was more general.

FWIW, I am a songwriter, singer, musician, producer, and "whatever else it takes" to get my music out into the world. That includes publisher, cover art creator, web developer, etc. Prior to starting to put my own recordings out in the mid-to-late 2000s, I was mostly focusing on the songwriting side of things, with other indie artists recording and releasing my songs, so I had to deal with the publisher side of things, issuing mechanical licenses and the like. At least to date, pretty much all my own recordings are self-released. (There are only two exceptions, one through a library-based label from the late 2000s and another that was on a charity CD alongside some better-known artists.) Thus, I also need to directly deal with the recording side of things myself. The MLC now makes things easier for the mechanicals on recordings by myself and other artists who have my songs out on streaming sites, but that is a new thing.

At this point, I really don't do much on the side of instrumentals or writing for libraries.

[3Seas]

RPaul, I added/edited-in a Taxi Video clip before I saw your reply to my previous comment.

Thank you for your reply,

I'm now watching the two-part Taxi TV the clip is a small part of and have ordered the book "Introduction to Music Publishing for Musicians" mentioned.
I think the book will more than fill in what additional level of understanding I'm seeking.

[Merryband1]

I just watched a short webinar from the MLC which mentioned SoundExchange. I'm over on their page right now, and wondering, since I don't have my publishing company set up on BMI yet (no $$ atm for the setup fee), should I join SoundExchange as my artist name(s) or my Label or my Publishing Company? I want to release music, not just strive for sync, although that's my main focus right now. Still, I have a few songs out there, and I want (AKA need) my royalties. Thanks for your input!

Still Merry but somewhat confused (and postponing joining SoundExchange until I know more)
Merryband/Marion

[RPaul]

I just watched a short webinar from the MLC which mentioned SoundExchange. I'm over on their page right now, and wondering, since I don't have my publishing company set up on BMI yet (no $$ atm for the setup fee), should I join SoundExchange as my artist name(s) or my Label or my Publishing Company? I want to release music, not just strive for sync, although that's my main focus right now. Still, I have a few songs out there, and I want (AKA need) my royalties. Thanks for your input!

SoundExchange is for the recordings, not the songs, so there is no need to have your publishing or BMI set up to join SoundExchange. You will join SoundExchange two ways, one being as the owner of the recording and the other as being the performer, and you do have to claim your recordings (via the ISRC number) on both sides. Typically, the owner would be the record company (which might just be you or maybe the name of your company if you have a formal one -- I just use my name here).

One note on the claiming of recordings that sometimes recordings don't show up in their database, and you can't claim them (at least I'm not aware of how to do that if there is a way) until they do. The quickest way to find a recording to claim is searching its ISRC number (since those are unique). I'm not sure if maybe recordings don't show up until they get some specific action (e.g. a play on one of the digital radio stations SoundExchange covers) or what the reason for some things not to show up is, but I do know there are currently about 5 or 6 of my recordings I haven't yet been able to claim. Three were relatively new (released early December), but the others were older (and there is one recording I released in late November that did already show up).