Mechanical royalties are payments to composition rights holders when a song is reproduced, downloaded or played through an eligible on-demand stream. They follow a separate collection path from the sound recording royalties an artist may receive through a distributor.
What mechanical royalties cover
A song has separate copyrights for its recorded performance and its composition, which consists of the music and lyrics. A stream on a service such as Spotify or Apple Music may generate recording, mechanical and performance royalties, with each paid through a different system.
Mechanical royalties generally go to the songwriters, publishers or others who own or administer composition rights. Co-writers receive shares based on their agreed splits. When an artist records a cover, the original composition rights holders are generally owed its mechanical royalties, while the artist’s recording may earn separate recording royalties.
The term dates to mechanical reproductions of music, including the perforated rolls used by player pianos in the early 1900s. The U.S. Copyright Act of 1909 introduced a compulsory mechanical license for certain reproductions that met its requirements.
How U.S. digital royalties are collected
In the United States, The Mechanical Licensing Collective (MLC) administers blanket mechanical licenses for eligible streaming and download services. Those services report song usage and pay royalties to the MLC, which distributes payments to registered members.
CD Baby pays artists recording royalties through its distribution service. Its CDB Boost add-on registers music with the MLC to collect mechanical royalties from eligible U.S. streams. The service is available to songwriters worldwide but does not collect mechanical royalties globally; international uses may require other arrangements, such as a publishing administrator like Songtrust.
Accurate titles, writer names, ownership shares and other registration details help collection organizations match usage to the correct works and rights holders. Performance royalties are distinct: public performances, including many radio broadcasts and live shows, can generate payments that U.S. songwriters generally collect through a performing rights organization (PRO) such as ASCAP, BMI or SESAC.
