Mechanical Royalties: Understanding Reproduction Rights Income

Mechanical royalties compensate songwriters and publishers when songs are reproduced—whether as physical copies, downloads, or streams. The term derives from historical player piano rolls, but today mechanicals primarily concern digital reproduction. Understanding mechanical royalties ensures musicians collect this important income stream.

How Mechanical Royalties Generate

Reproduction triggers mechanical royalty. Each copy made of a song generates mechanical royalty obligation.

Physical products generate mechanicals. CDs, vinyl, and other physical formats owe mechanical royalties.

Downloads generate mechanicals. Purchased digital downloads trigger mechanical royalties.

Streaming generates mechanicals. Each stream represents a reproduction generating mechanical royalty.

Mechanical Royalty Rates

Statutory rates exist for physical and downloads. Government-set rates determine physical and download mechanical rates.

Streaming mechanical rates differ. Streaming mechanicals are calculated differently, often as percentage of revenue.

Compulsory license enables covers. Anyone can record a cover song by paying statutory mechanical rate.

Collection Mechanisms

Different sources have different collection paths. Physical, download, and streaming mechanicals each have collection particulars.

Mechanical Licensing Collective handles streaming in United States. MLC collects and distributes streaming mechanical royalties.

Harry Fox Agency handles traditional mechanicals. Physical and download licensing often goes through HFA.

Publishers and administrators handle collection. Publishing entities typically manage mechanical royalty collection.

Streaming Mechanical Specifics

Interactive streaming generates mechanicals. On-demand streaming services owe mechanical royalties for each stream.

Rate determination involves complex formula. Streaming mechanical rates depend on service revenue and other factors.

MLC registration is essential. Registration with Mechanical Licensing Collective captures streaming mechanicals in United States.

Metadata matching affects payment. Correct identification information helps match streams to compositions.

Registration for Mechanical Collection

MLC registration captures streaming mechanicals. Without MLC registration, streaming mechanicals go uncollected.

Accurate metadata enables payment. ISRC codes, ISWCs, and other identifiers must be correct.

Publisher or administrator registration may occur. If working with publisher, they may handle mechanical registration.

Self-publishing requires self-registration. Independent artists managing own publishing must handle registration themselves.

International Mechanical Collection

Foreign collection requires representation. Mechanical royalties in other countries need collection mechanisms.

Collection societies vary by country. Different countries have different mechanical collection organizations.

Sub-publishing enables international collection. Publishing relationships or administration services handle foreign mechanicals.

Mechanical Royalties from Physical Products

Physical manufacturing requires licensing. Producing physical products means obtaining mechanical licenses.

Label responsibility for mechanical payment. Labels releasing physical products typically handle mechanical licensing.

Self-releasing requires mechanical consideration. Independent artists pressing vinyl or CDs must address mechanicals.

Cover Songs and Mechanicals

Compulsory license allows covers. Anyone can record previously released songs by paying mechanical royalties.

Licensing services simplify process. Services facilitate obtaining mechanical licenses for cover recordings.

Rate payment to original writers. Cover song mechanicals go to original songwriters, not cover artists.

Common Mechanical Royalty Issues

Unregistered songs lose royalties. Without proper registration, mechanical royalties go uncollected.

Metadata problems cause payment failure. Incorrect or missing information prevents proper royalty distribution.

International royalties often go uncollected. Without global collection arrangement, foreign mechanicals may be lost.

Historical unpaid royalties may exist. The MLC maintains unclaimed royalties database; past royalties may be recoverable.