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What are royalties? How do they work, and how can you make money from them?

Alex Thomas avatar
Written by Alex Thomas
Updated over a week ago

What are royalties?

Royalties are the fees that are paid to the rights owner of music content (normally record labels, publishers, writers and performers) for the use of their work. This happens every time music is played, downloaded or streamed.

How does earning through royalties work?

The process of earning money through royalties is a very straightforward one. Essentially, when you make and distribute your music, you have the ability to collect the money that you are rightfully due from anyone who downloads, streams and purchases your song.

For example: When you stream the music of a top artist such as Eminem on a streaming service like Spotify or download his latest track from iTunes, he is generating money from that stream/download.

When a song is downloaded, the real slim shady (if he will please stand up?) gets a percentage of the sale price.

Whenever his songs are streamed, a pre-negotiated “play rate” will be added into the piggy bank Spotify owes him.

To put it plainly, every single time your song is streamed on an online platform such as Spotify, Apple Music or YouTube or downloaded from iTunes or Amazon Music, you are owed royalties.

When you distribute your music with us, we process your royalties and pay you directly.

This process is known as Royalty Licensing, which is basically collecting your fair share of profits from an original piece of music.

With royalty payments, the earning potential is sky-high. This is why we partner up with all the most popular streaming platforms across the globe. You can get your music out there, in front of billions of potential listeners, and start making the big bucks!

To see how we can help you get your music out there, check out our digital distribution services and get in touch with our team using the online chat.

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