Music travels faster than ever in our digital age. But for its rights holders, the essential question remains: how are listens, shares, and uses transformed into royalties?
Where do digital royalties come from?
Digital royalties have the potential to be generated every time a musical work is used on online platforms. This includes:
- Audio sources: Internet radio, streaming services like Spotify or Apple Music, and podcasts.
- Audiovisual sources: social media like TikTok, Instagram and Facebook, online films and series, television, video games, online fitness services, karaoke, music learning apps, and even music videos.
In practice, these services pay a license to SOCAN to use the works in its repertoire. SOCAN collects these amounts, analyzes the usage data, and then distributes the royalties to the proper rights holders. When certain platforms offer music for free, SOCAN seeks a minimum licence fee to ensure that music does not lose its value.
Making Sure You Get Paid
To receive your royalties, it’s not enough for your song to be played—it must also be properly identified and registered. Here are some key steps to follow:
- Register with the appropriate collective management society:
Composers, Authors & Publishers
Public Performance & Communication Rights: SOCAN
Reproduction Rights: SOCAN or CMRRA
Performers & Master Rights Owners (labels):
Public Performance & Communication Rights: Re:Sound, Artisti, ACTRA RACS
Reproduction Rights: Panorama (previously known as SOPROQ), CONNECT Music
- Consider fingerprinting or sound ID services like Gracenote or BMAT to help identify your songs when they’re “Shazamed” or used in other digital formats.
Properly fill out your metadata:
- ISRC code (sound recording)
- ISWC code (musical work)
- IPI number (rights holder)
- ISAN code (International Standard Audiovisual Number)
These codes serve as the “ID card” for your works. Organizations like MétaMusique (Québec) or distributors like Amplitude can help you manage them.
Don’t forget: Without accurate and up-to-date metadata, your royalties risk getting lost along the way.
What digital distributors do
A digital distributor acts as an intermediary between your audio file and the public. They are the ones who deliver your songs to platforms like Spotify, Apple Music, and Deezer, but also social media platforms and other digital storefronts where music is used.
Today, distributors do much more than simply distribute your music:
- Some offer “label-like” services (promotion, placement, marketing).
- Others offer music publishing or synchronization opportunities (use of your works in screen productions).
These services can be useful, but it’s essential to read the fine print.
Things to consider:
- Do your homework. When evaluating potential distribution partners, carefully review each company’s operations, confirm their countries of origin, and assess whether their services align with your needs. Remember, you have the authority to determine where your music is distributed and monetized.
- Keep your SOCAN Membership Agreement in mind! SOCAN exclusively administers your public performance and communication rights within Canada. Any organization or business requesting that you waive your performance rights should be approached with caution. Waiving these rights can disrupt the licensing process and may prevent royalties from being generated.
- Are you self-published? Certain distributors may ask that you forfeit your publishing royalties unless you assign your publishing rights to them or a specific publisher. In fact, it is entirely possible to collect your publishing royalties independently, or you may opt to collaborate with a reputable publisher who can best represent your interests.
Simply put, don’t license your rights without knowing what you’re signing.
Digital opportunities
The digital world also offers new avenues for potential revenue:
- TV and Online Films: SOCAN currently seeks licenses for both Communication and Reproduction Rights for these digital uses. SOCAN has a certified AV rate in place for online audiovisual since 2013. With the advent of SMART connected TVs, digital broadcasters can now easily provide content from around the globe. New services emerge regularly, and when Canadians can access these services online, SOCAN can seek licenses from these online platforms.
- Video Games: With the advent of game streaming, new revenue opportunities have emerged. By working closely with our members and clients, we can optimize royalty collection in this area. We encourage members who create works for video games to declare their audiovisual cues and work with SOCAN to enhance data accuracy.
- Fitness, wellness, and music learning: Significant advancements are happening within these emerging digital fields. Large-scale digital platforms can generate comprehensive usage data, resulting in more efficient and effective royalty allocation.
- Virtual worlds: Companies such as Styngr in the metaverse show how music can be integrated and valued within immersive digital environments. https://www.styngr.com/
- Online Concerts: SOCAN applies the same licensing requirements to online concerts as it does to live in-person performances. Members are reminded to declare their online shows if tickets are sold or performers receive compensation for their participation.
In short
Effectively navigating the digital music economy demands vigilance, organization, and strategic planning. Understanding royalty sources, maintaining accurate metadata, selecting reputable distribution partners, and exercising caution during contract negotiations are all essential steps to maximizing your earnings from your music.
While the digital landscape continues to evolve rapidly, it also presents new opportunities. With thorough preparation and the right tools, creators can enhance their visibility and secure fair compensation for their work.