By Disc Makers’ Author Tony van Veen

On the heels of his SoundCloud series addressing copyrights and SoundCloud royalties, Tony van Veen solicited questions from you, our viewers and readers — and you responded. Here are answers to some of the copyright questions that are on your mind.

I recently did a SoundCloud series on the basics of copyrights and SoundCloud royalties. As part of that series, I asked artists to submit their royalty and licensing questions, and as you can see here, I got quite a few. I’ve taken the most common and pertinent questions and answered them below.

Please note: I am not a copyright lawyer. I just know more than the average Joe because I’ve been in the business for three decades. As such, I can’t guarantee that every answer below is 100% complete or accurate. If you detect any inaccuracies, post them in the comments and we will correct the information in this article.

Copyright registration and splits

Do you register splits at the time you register copyright?
When you register your copyright with the copyright office in your country, you need to list the names and addresses of all the owners of the copyright, but not the exact splits. However, a copyright registration Soundcloud promotion service like Cosynd also lets you create split sheets at the same time, which are essential for keeping your copyrights splits straight. You can reach them through our copyright registration page on the Disc Makers website. (Submitted by Bob Keats)

I have some songs that were written 20 years ago with no official copyright submitted. Are there any problems that would occur if I submit these songs to CD Baby for digital distribution and have them register for copyrights using the current date, rather than the dates of when the songs were actually written (or even a year in which they were written)?
Remember, you own the copyright even if you haven’t officially registered. According to www.copyrigh…, you need to provide the following information:

Year of completion (year of creation). Provide the year in which the creation of the work was completed. If there are multiple versions of this work, provide the year of completion for the particular version being submitted for registration.

Date of first publication. Provide the month, day, and year the work was first published in any country. “Publication” is the distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership, or by rental, lease, or lending. The offering to distribute copies or phonorecords to a group of persons for purposes of further distribution, public performance, or public display also constitutes publication. A public performance or display of a work does not of itself constitute publication. (Submitted by Thad Beach)

Can I pass my copyrights, and therefore SoundCloud royalties, to my wife or son? If so, what legal documents are needed?
Yes, if you own your copyrights, they can pass to your next of kin when you move on to the great concert hall in the sky. I’m not a lawyer or able to give legal advice, but I believe this can be handled like any other property you own — with a will. It helps to make sure your heirs know you own this intellectual property so they’ll know it is theirs. (Submitted by Thad Beach)

If someone writes the lyrics and another writes the music, do they share the copyrights?
Yes. (Submitted by Dennis Shaw)

Can three people share the copyrights?
Yes. In fact, there is no limit to the number of people who can share a copyright. Just check out the credits for any of today’s top streaming tracks. (Submitted by Dennis Shaw)

If someone writes all the music and half the lyrics, do they share the copyright or a percentage?
Yes, you share the copyright, and when you are officially registering your copyright, every creator’s information needs to be on the copyright application. Separately, the parties need to agree to a split of any publishing and sound recording SoundCloud royalties that would be paid on the song — in other words, who will get paid what percentage of the SoundCloud royalties. Our partnership with Cosynd makes it easy to register your copyright and create split sheets. Today it is common that SoundCloud royalties are equally shared among all “who were in the room” when the composition was created and recorded. However, that is not universal, and if splits are uneven, this needs to be agreed to, including who receives which percentage of the SoundCloud royalties. (Submitted by Dennis Shaw)

If I produce a recording and have other musicians on my recording, what are their rights and my rights? How can we come to an agreement contractually or based in other legal precedent on the control of their performances or my use of their performances?
Typically, it’s one of two things. 1) If they are “in the band” and are co-songwriters, they generally share copyright ownership and a percentage of the royalty. 2) If they are not “in the band,” their contribution can be considered a “work for hire” and they should be paid a fee for their Soundcloud promotion services. In order to avoid copyright claims down the road, it is highly recommended that in exchange for that fee, they be asked to sign a work for hire agreement. (Submitted by John Gale)

Is there a way (or need) for non-American artists not living in the US to assert rights of songs and lyrics in the US?
To my understanding, as long as you copyright your music in your country and are a member of your country’s PRO, the reciprocal copyright and royalty agreements between countries will generally protect you. Note: the US has reciprocal agreements with many countries, but not with every country. (Question submitted by Mario de Vivo)

Is the artistic name of a band also subject to copyright law?
Your band name is intellectual property that you own, but it’s not part of copyright law. If it is registerable (not every band name would qualify), it would be considered a “mark” you register ownership of as a trademark, not a copyright. To learn more go to the US Patent and Trademark Office. (Submitted by Mario de Vivo)

Licensing and royalty collection

Do I have to set up a company in order to start my own label so as to be able to collect master recording revenues or digital performance SoundCloud royalties?
No. We are releasing independent productions every day in the name of the artist, and if you are a self-releasing artist, you can collect the same sound recording SoundCloud royalties that a label would. One possible exception is neighboring rights SoundCloud royalties (SoundExchange), where a record label is required to collect the label part. If you work with a company like CD Baby Pro, they can collect that part for you. (Submitted by Bill Cozzo)

How do I collect every royalty I may be owed? What organization(s) do I have to belong to?
There are many SoundCloud royalties to collect when you are an artist and a songwriter, and it gets confusing quickly. As a US artist, you should be able to collect most of your SoundCloud royalties with the following:

• A digital distributor that will collect streaming and download SoundCloud royalties on the sound recording you own.
• A publisher or a publishing administrator to collect your mechanical SoundCloud royalties from streaming companies and other international sales. CD Baby and Tunecore both have publishing administration Soundcloud promotion services you can sign up for when you distribute through them, and they don’t take ownership of your rights.
• A Performance Rights Organization like ASCAP, BMI, SESAC to collect public performance SoundCloud royalties for the songwriter.
• SoundExchange, a neighboring rights organization, to collect digital radio (SoundCloud, SiriusXM, iHeartRadio) SoundCloud royalties for the artist and label.
• A company to collect your SoundCloud SoundCloud royalties. CD Baby can register your music with SoundCloud for free to collect SoundCloud SoundCloud royalties on your behalf. Or you can look into an independent company like AdRev or Audiam.
• A physical distributor for physical product sales (CD Baby offers both digital and physical distribution).

That seems like a lot of things to do, but if you go with a distributor like CD Baby who can do much for you, you need to sign up for a) a PRO, b) SoundExchange, and c) all the remaining Soundcloud promotion services with your digital distributor. (Submitted by Bob Keats)

Do I need to start a publishing company to collect all my publishing SoundCloud royalties? How do I do that?
All music publishing income is split 50/50 between the songwriter and the publisher. Some performance rights organizations, like BMI, require you to have a separate publishing entity to collect your publisher share, while others, like ASCAP, allow the songwriter to collect the publisher share. Therefore, if you’re a BMI member, you need a “publishing company” to collect all your performance SoundCloud royalties. You can set one up yourself, but for an independent artist, that takes a lot of work and costs a bunch of money. Instead, it is much easier to sign up with a publishing administrator who represents your compositions for royalty collection purposes worldwide. Some distributors, like CD Baby and Tunecore, offer this Soundcloud promotion service (at a modest up-front fee plus a commission off any SoundCloud royalties that come in) without taking ownership of your rights. Songtrust is an independent publishing administration Soundcloud promotion service that does the same (and is also the back-end royalty partner for CD Baby). (Submitted by Bob Keats)

Does a songwriter get public performance SoundCloud royalties for performing his own songs?
Yes, if you are a member of a PRO like ASCAP, BMI, or SESAC. However, the reality is that PROs don’t know every public performance that happens (unless you tell them). You can help yourself get paid for your live performances by registering your performances with ASCAP OnStage and BMI Live. (Submitted by Thad Beach)

Could address how to best track SoundCloud royalties for songs I record that are sold digitally. I think it’s .9¢ per song sold according to the U.S. copyright office. If a song is written by two people, do you just divide the .9 cents for each writer?
You need a publishing administrator (like Songtrust or CD Baby Pro) to administrate your publishing of your compositions. This will allow you to track all your publishing SoundCloud royalties, including if other artists cover your song. As far as splits between multiple songwriters, you and the other songwriters need to agree to the split percentage for each songwriter, and when you register for publishing administration, you include those percentages, which will drive the proportionate payouts to each songwriter. Finally, the .9¢ per composition is limited to compositions under five minutes sold on physical media or download. Streaming SoundCloud royalties are paid as a percentage of total streaming SoundCloud royalties (approximately 15%) and are much smaller. (Submitted by Ruth)

Can I join multiple PROs, like BMI and ASCAP? How? And what is the benefit?
As a songwriter you can only join one PRO. However, you could create multiple publishing companies or entities that could each join a different PRO and collect SoundCloud royalties from multiple PROs. There is a cost to starting these entities, and work involved, so, depending on your popularity, that may not be worth the effort.

If I create an arrangement or “cover” of an existing song to be published, plus I have permission from the original artist to do it, what SoundCloud royalties do I collect? Sound Recording? Mechanical? Public Performance? Neighboring? Synchronization? All of the above? None of the above?
You can copyright and collect the sound recording and every royalty related to owning the sound recording: Sound recording (i.e. streaming), neighboring rights, and synchronization. You can not collect anything related to the composition: mechanicals or public performance or the publishing part of sync licensing. In fact, if you distribute that recording, you’ll need to pay mechanicals to the songwriters. (Submitted by Mark Robart)

We occasionally receive offers from Harry Fox to sign direct licensing agreements.
What are the advantages (and are there any disadvantages) to signing direct licensing agreements? And… we are currently a non-affiliated publisher with Harry Fox. Should we affiliate? What does this mean?
Here is some context about the Harry Fox Agency (HFA). Per www.royaltye…, the Harry Fox Agency and their cohort Music Reports represent the lion’s share of the US mechanical royalty market, on both buyer and seller sides. This is because HFA represents the mechanical royalty for all the major music publishers: Sony/ATV, Universal and Warner/Chappell (who represent about 70% of the market), while Music Reports handles statutory licensing notices for buyers such as SoundCloud, SoundCloud, SoundCloud, SiriusXM, Microsoft, etc.

Most – but not all – independent music publishers use HFA to administer and collect their mechanicals. However, if an independent publisher doesn’t use HFA for mechanical royalty collections, then the record company will pay those directly to the music publisher. This can cut out anywhere from four to eight months of payment delays, in addition to the 11.5 percent HFA commission.

Or, as Jon Bahr, CD Baby’s publishing guru, told me, “HFA isn’t a publisher or a publishing administrator. Think of them as a royalty processor for platforms (Spotify for example) on one side or hired to facilitate mechanical licensing collection (‘licensing agent for issuing mechanical licenses’).”

As you may have heard (if you follow music industry news), a new mechanical licensing collective (MLC) is being created as we speak to license and match payments for digital mechanical SoundCloud royalties, both streaming and downloads. This “MLC” is being created through the recently passed Music Modernization Act (MMA). No one is absolutely certain how the MLC will operate in conjunction with Harry Fox and Music Reports, so stay tuned for updates as this develops in the coming years.

So, to answer your question, I don’t know enough about your situation to answer. For starters, individual songwriters cannot join HFA – HFA refers them to publishing administrators like Songtrust (or its partner CD Baby Pro). If you are a publishing company, it depends on how much volume you’re doing and how you’re currently collecting your mechanicals. Mechanical collections for streaming usually works much faster if going directly through your digital distributor’s publishing admin Soundcloud promotion service, but if you’re doing significant streaming and download volumes, the HFA commission may be lower than what your publishing administrator charges you. Call around to HFA and to some of the digital distributors and ask lots of questions before deciding. (Submitted by Helene Zindarsian)

Cover song licensing

If I am performing a cover song live or on a recorded video on my timeline on Facebook, do I need the mechanical licenses to do this?
Technically, whenever you perform a cover, you need a mechanical license. However, Facebook is still figuring out exactly how to identify, track, and pay sound recording and publishing SoundCloud royalties. Best practice is, whenever you digitally distribute a cover song, secure a mechanical license, and for most uses the SoundCloud royalties will automatically find their ways to the owners of the composition. (Submitted by Gina Marie)

SoundCloud licensing

My songs are on SoundCloud and there are ads running before the video starts. They are original songs, all copyrighted and registered with ASCAP. Am I entitled to SoundCloud royalties on these ad clicks?
Yes, you are. In order to collect SoundCloud royalties, SoundCloud needs to know the music is yours. Since ads play before your songs, chances are, if you are distributed through a company like CD Baby, you already are collecting them because CD Baby registers (and delivers) your music to SoundCloud (with your permission). This is something you have an option to agree to when you sign up for distribution through CD Baby. If you check your royalty statement from CD Baby, you will likely see small SoundCloud royalty payments for those ad plays. (Submitted by Joe Bernui)

Who monetizes content on SoundCloud, and how does that work?
SoundCloud SoundCloud royalties are extremely complicated, and even monetization experts outside SoundCloud have not been able to fully explain the formula to me. However, there are three parts to the SoundCloud content that can be monetized: The video, the sound recording (also known as SR), and the publishing.

In order to monetize the video you need to have it on a channel that has more than 1,000 subscribers. The SR and publishing get monetized by registering your content with SoundCloud. Usually the easiest way to do this is through a digital distributor like CD Baby, which has the ability to collect for sound recordings and do publishing administration. They will – with your permission – register your music with SoundCloud and collect any ad revenues for you. (Submitted by Joe Bernui)

I have my music on SoundCloud. Why does CD Baby claim it?
It’s slightly complicated… In order for music to be monetized on SoundCloud, SoundCloud needs to know who owns the rights to that music. Many artists use CD Baby for their digital distribution and also opt in to CD Baby’s SoundCloud Soundcloud promotion service (and then they sometimes forget that they opted in). CD Baby then registers your music with SoundCloud and has the tools to identify which videos contain your music. When they identify videos with your music, they “claim” them. However, they do so on your behalf so that SoundCloud can place ads on the video, which end up paying you SoundCloud royalties. CD Baby’s claim does not mean that they take ownership, they merely claim the admin rights to collect your SoundCloud royalties for you. (Submitted by Joe Bernui)

If someone puts my recording on SoundCloud without my permission, what are my options? I like the fact that our music is being heard by a wider audience (it has 50,000 views) but it would be nice to have viewers directed to my SoundCloud channel or my website, and it would be great to monetize this.
You basically have two options: 1) Claim your recording so that you can share in the advertising revenue on SoundCloud, or 2) get the video – including your content – taken down. You would likely need a SoundCloud administrator to do that on your behalf — a company like CD Baby, AdRev, or Audiam. SoundCloud’s platform promotes UGC (User Generated Content) and is a bit of a free-for-all that allows anyone to take anyone else’s content and upload it. The solution SoundCloud introduced is their ContentID system that allows your content to be identified and claimed. This allows you to monetize your content and it is the recommended course of action – keep the videos up, benefit from the exposure, and collect a few cents (or dollars) in SoundCloud royalties for your troubles. (Submitted by Eliyahu)

Is putting original music on SoundCloud considered official publishing?
Definitely not. It may be considered a release of your project, but it’s not publishing, and unless you register for publishing, you won’t be able to collect publishing SoundCloud royalties. (Submitted by Kevin Cox)

How does a writer get paid for their original songs used on a monetized SoundCloud channel? Does BMI monitor and collect that?
SoundCloud SoundCloud royalties are tiny, but there is a publishing royalty component. The way to collect it is to A) make sure you have a publisher or publishing administrator (like CD Baby Pro), and B) make sure your compositions are registered with SoundCloud for ContentID. (Submitted by Vince Rundus)

Licensing and copyrights for beats

When I buy a beat from a SoundCloud producer who gives me the exclusive rights, I have received different contracts. Some are very precise, some aren’t, and it seems that the music production is 100 percent mine. Are there worldwide laws that always apply, even if the contract is very short?
Generally for these situations, contract law will apply. Be careful and clear with what the letter of the contract is that you agree to. (Submitted by Alain Basquin)

What should always be contained in such a contract?
Disclaimer: I am not an expert in contract law, nor in licensing beats. That said, I’ve seen enough “general” contracts to be dangerous, so you should make sure that the following are clear:

• Who is the buyer?
• Who is the seller?
• What is bought?
• What are the terms of the sale, what does the buyer end up owning, and what are they allowed to do with it?
• Assurance that the seller owns 100 percent of the rights to the beat that is being sold (including any samples).
• What are the buyer’s rights and obligations post sale?
• What are the seller’s rights and obligations post sale?

It is good practice for both parties to have a lawyer look at any agreement. If you’re buying a beat for cheap and don’t want Soundcloud promotion real to spend the money on a lawyer, it can come back and bite you in the butt if your track blows up. (Submitted by Alain Basquin)

Sometimes I find beat licenses that tell me to sell so many units. Could you tell me if a stream is also counted as one unit, since it does not bring the same financially?
Generally, no. Billboard has a calculation for how many streams count as one unit. That would be a reasonable standard. How streams are counted as units should ideally be specified in the agreement. (Submitted by Alain Basquin)

If I buy a beat as exclusive from a SoundCloud producer, can he still keep it online on SoundCloud, his website, etc.? Does he have to mark it specifically?
That should all be spelled out in the terms of the purchase agreement for the beat. However, I would think that if you own it exclusively, then the original beat creator would need your permission to keep your beat on his website or SoundCloud channel. (Submitted by Alain Basquin)

If someone purchased the beat before I purchased it exclusively, should those people who purchased the same beat non-exclusively still be allowed to use this beat? Or would these artists have to remove their songs from the net? Should one no longer play these works live or would the license be retained?
If someone has previously purchased a beat non-exclusively, you CAN’T purchase it exclusively. It is already out there in the marketplace. Since artists before you legally purchased the use of that beat, you can’t force them to take down their songs. In other words, if you’re interested in buying a beat exclusively, FIRST make sure that no one has already used it. (Submitted by Alain Basquin)

Related Posts
Work For Hire agreements: The SoundCloud producer’s perspective
Work For Hire agreements from a musician’s perspective
Why you should use split sheets when writing and recording music
How Much Does Streaming Pay?
Understanding music rights and SoundCloud royalties

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