Types of Music Royalties
6 Types of Music Royalties
- Performance rights Royalties – These rights deal with live performances or broadcasts. The licensee pays a set fee to a PRO and is generally able to play the entire collection (or in some instances and individual property) covered. Performance royalties are paid to the songwriters and publishers when the song/s are performed live or on radio.
- Mechanical licenses Royalties – These refer to mechanically reproduced music (i.e. CD, Cassette etc.) for public distribution. The publisher grants an allowance for the composition to be reproduced and in turn a royalty is paid to the artist, songwriter and publisher on a per/recording sold basis. For digital streaming and downloads in the U.S., these are collected and paid by the Mechanical Licensing Collective (MLC), created under the 2018 Music Modernization Act.
- Synchronization rights Royalties – These licenses are needed for compositions to be reproduced and used in other forms of media such as television, film, video, games, etc… The synchronization royalty is paid to the songwriters and publishers for use as “background music.”
- Print rights Royalties – These are paid to publishers and songwriters based on sales of their printed musical compositions and sheets.
- International Royalties – For global distribution, royalties are collected by international collection societies and PROs. U.S. artists should register with international affiliates of ASCAP/BMI to ensure overseas performances are tracked and paid.
- Smart Contract Royalties – Smart contract royalties are automated blockchain payments that instantly compensate creators when their work is used or sold. Found on platforms like Sound.xyz and Royal.io, they offer artists direct control, transparent earnings, and auto-split revenue, without intermediaries. As Web3 expands, these royalties are becoming central to how artists monetize their work.
These types of music royalties listed above are the main types in the United States and there may be others in other countries and jurisdictions.
2025 Royalty Trends and Legal Changes – Updated June 2025
AI-Generated Music & Royalty Disruption
In 2024–2025, major record labels, including Universal, Warner, and Sony, began negotiating licensing deals with AI music platforms like Suno and Udio. These platforms generate music using large training datasets, often pulled from label-owned catalogs. The challenge? Artists may not directly benefit unless contracts explicitly address AI licensing rights.
See reporting via:
Without fair licensing agreements, AI-generated tracks may mimic styles or voices without triggering traditional royalties, raising concerns about compensation and ownership.
Proposed U.S. Streaming Royalties Law: New York’s Push
In a landmark 2024 development, the New York City Council passed Resolution 368, supporting the federal Living Wage for Musicians Act, which proposes:
- A 50% surcharge on streaming subscriptions
- Funds paid directly to artists, bypassing labels and publishers
This effort could transform royalty distribution for streaming-era musicians.
Read more:
The Bottom Line: Royalty Protection in the Age of AI
Whether you’re a songwriter, recording artist, or independent label, understanding the types of music royalties in 2025 means more than knowing the basics; it means staying current with industry disruptions. With AI-generated content and legislative reforms reshaping how royalties are earned and shared, artists must actively review contracts, register with the right agencies, and stay informed.
As with all issues in law, there is generally no one clear answer to certain issues, and the circumstances are always of vital importance.
Need help navigating the different types of music royalties?
Book a consultation with Zamani Thomas Legal to ensure you understand the types of music royalties available and how to structure your rights, payments, and contracts to protect your work in today’s creative economy.