If you are a serious musician, there will come a day when you choose to join a PerformanceRights Organization. This is the best way to make money as a musician.
If your music is used for anything, say a commercial, you are paid in royalties which are calculated and distributed through the Performance Rights Organization. However, you may not get the money you are due unless you sign up with one of the four major PROs: BMI, ASCAP SESAC, or GMR.
Each organization has its shares of pros and cons. So which one should you go with? Read on to find out.
Let’s start by getting a better understanding of how the process works.
Performing Rights Organizations help musicians in the licensing of their work and management of their rights so they can get consistent income from outlets like radio stations, television, video games and more. The payments are called royalties and they are distributed through PROs. Royalties are always split 50/50 between songwriters and publishers (if you haven’t registered with a publisher, you are recognized as your own publisher and you keep 100%).
Any artist can sign up for a PRO service. Once you’re signed up, all you have to do is register all of your original works to start collecting royalties (minus a service fee). It is very important that you keep your account up to date and register every new work you create with your PRO. Artists miss out on money all the time simply because they forgot to register their newest material with their PRO before performing it.
Royalties may be paid for any of the following:
- Use in a commercial
- Airplay on the television or radio
- A live performance
- Use in a film
- Use in a video game
- Streamed in a public place
Now you may be wondering, how are these royalties collected and distributed? It’s all done through something called a cue sheet.
A cue sheet is a document that outlines what songs were used, how they were used and who used them. It credits the artist for providing the song. It is filled out by the person or organization that used the song and given to the PRO.
It is important to realize that PROs do NOT collect royalties from private streams, nor do they collect your mechanical royalties for physical or digital sales. They also don’t collect fees from master rights, most internet radio streams, or digital cable music. To collect these royalties, you need to go through your distributors or your record label if you have one.
Broadway and musical plays are something of a grey area. While music from plays can be registered through a PRO, it can only be used in specific scenarios. If the song is used in another dramatic work in a similar context as the original production, it is considered a violation of the production’s “grand rights”, even if the work was properly licensed.
Your PRO will collect performance royalties anytime a cover of your song is performed by another artist.
Choosing a PRO
In North America, there are dozens of PRO organizations, but the four main ones are Broadcast Music Inc., (BMI), American Society of Composers, Authors and Publishers (ASCAP), European Stage Authors and Composers (SESAC), and Global Music Rights.
So which one is right for you? There may be no right or wrong answer to this question as each has its share of advantages and disadvantages. However, they may have features that are better suited to your professional and personal situation.
We will review each so you can make an educated decision on which is the best suited to your needs.
BMI stands for Broadcast Music Inc. It is the largest PRO in America. It is a nonprofit organization with one of the largest available catalogues including over 17 million musical works, and 1.1 million songwriters, composers and publishers.
The company formed in 1939 to protect the recorded music and performances of artists in the blues, jazz and country genres. Today, it represents artists across a wide variety of musical styles.
It is free for songwriters to join BMI. However, publishers must pay $150 and companies must pay $250. BMI also collects around 12% of the royalties that their catalogue makes. Famous artists on BMI include Lady Gaga, Kendrick Lamar and Taylor Swift.
BMI focuses on bridging the gap between companies that need music and songwriters that fit the genres they are looking for. Although they are based in the United States, they work internationally helping artists market and sell their music overseas. They are also knowledgeable of how music is used in new technologies and will update their services to accommodate the newest apps and streaming services.
Although business owners can license works individually, most businesses purchase a blanket license to gain unlimited access to the entire BMI catalogue. The cost of this license wildly varies based on a few factors, including the size of the business, which songs are used, and what type of business holds the license (bars and venues have to pay more than retail stores). The average license costs anywhere between $250 and $400 annually, but the price can be as high as $2000 for a large business.
ASCAP stands for American Society of Composers, Authors, and Publishers. ASCAP was launched in 1914 as a non-profit organization dedicated to protecting artist’s copyrights for public performance and live broadcasts. ASCAP is the longest running PRO and the 2nd largest with over 10 million and works and 735,000 musicians and publishers.
Unlike BMI, ASCAP charges a $50 dollar application fee for musicians, publishers, and companies alike. ASCAP also collects 12% of the royalties their catalogue makes. ASCAPs top artists include Ariana Grande, Beyoncè, and Stevie Wonder.
ASCAP is unique in that it is owned by its members. Every two years, a group of 12 writers and 12 artists are nominated to join the ASCAP Board of Directors. As a result, ASCAP is focused on combatting the diminishing profitability of music by ensuring fair rights and fair pay for all their members. ASCAP is more reliable when it comes to claiming international royalties for their members, and they pay more money per use to their artists.
ASCAP also offers a blanket license that grants businesses unlimited access to their catalogue. Much like BMI, the price is variable from business to business, but ASCAP’s license consistently costs more. You can use this calculator to figure out how exactly much each license will cost.
Oftentimes, music does not belong to a single PRO, as multiple people from different PROs may have credits on one song. As such, most businesses purchase licensing with both BMI and ASCAP to avoid conflict, meaning the two services receive roughly equal exposure despite their price differences.
SESAC is unique from its fellow PROs in many ways. First, it is the only PRO that operates for profit. Additionally, to join SESAC, you must receive an invite from the company itself. As a result, their catalogue is relatively small, with only 30,000 artists and around 1 million songs.
SESAC was founded in 1930 as the Society of European Stage Authors and Composers. At the time the company was dedicated to helping European writers collect royalties in America. They have since expanded to represent American and European artists across a multitude of genres.
The company takes pride in their exclusivity and claims that their small size allows them to focus on each of their artists individually. A few of their celebrity clients include Bob Dylan, Adele, and Mumford & Sons.
Once invited, it is free to join SESAC. SESAC does not publicly disclose the percentage of royalties that they collect for themselves, but due to their smaller size and their status as a for-profit business, the organization is able to pay their artists more than BMI or ASCAP.
SESAC also offers monthly royalty payments, unlike other PROs which payout every 3 months. On the flip side, their blanket license is more expensive than BMI or ASCAP and it covers significantly fewer works, making it the least popular option with businesses.
Perhaps the greatest advantage of joining SESAC is the membership perks. Members of SESAC get a multitude of discounts, including but not limited to:
- 10% discount at Sprint
- 15% on your first year at Songtrust
- 33% discount on American Songwriter Magazine
- Discounts for airport parking
- 10% discount at Bertleemusic.com
Global Music Rights is another invite only PRO. The non-profit was founded in 2013, making it the first PRO established in nearly 75 years. Due to its recent establishment and its exclusivity, only 114 songwriters are registered with GMR, covering 58,000 works.
Like ASCAP, GMR’s primary goal is to keep the music business profitable by ensuring fair pay and fair rights for all their members. Some of their most famous artists include Childish Gambino, Post Malone, and Prince.
Unfortunately, due to their relatively recent establishment and high exclusivity, not much information is publicly available about GMR. It is unclear exactly what percentage of the royalties they keep. However, their small scale means less division of profits, making GMR highest paying PRO on a per-play basis.
Another distinct advantage to GMR’s scale is that they are able to provide all of their members with analytics that show how much they are making in specific locations and markets. This data can be extremely valuable for tour planning and marketing. On the downside, the PRO’s size means less opportunities for you and less exposure for your music.
Which One Do I Choose?
Now that you have the facts, you can decide which PRO is right for you. ASCAP offers higher payouts in the long term than BMI, but if you’re just getting your career off the ground, it’s going to take you a while to earn back that $50 membership fee. BMI offers the most accessible license and the most modernized services, but also provides the lowest payout of any PRO.
SESAC is a different beast entirely. Assuming you receive an invite, they offer the highest royalties of any PRO, on top of their slew of perks and more personal relationship with their clients. However, SESAC licensing is the least popular of the three, meaning your music has less potential to receive exposure in commercials, games, retail stores, etc.
At the moment, GMR is still finding its footing and establishing a catalogue. As such, it’s not a great choice for new artists. However, as the PRO continues to grow, their licensing will become more accessible. With a bit of time, GMR has the potential to grow into the most profitable PRO, so keep your eye out
If you decide you’re unhappy with the PRO that you chose, you’re not locked in forever. BMI has minimum term of 2 years, while ASCAP gives you a specific window of time each year to cancel your membership (the exact time frame is relative to when you started your account).
SESAC doesn’t publicly disclose their terms for termination, but you can bet that they’re not letting any of their artists go without a fight.
Keep in mind, if you are a non-performing songwriter, PROs won’t do much for you until you’re ready to bring your music to market. As such, you may want to wait to register until you’re ready to cash in, as you never know how each PRO is going to change over time. However, if you are performing, signing up with a PRO provides guaranteed income, and even if you’re only making a few dollars per performance, every little bit counts.
PROs are one of the main sources of revenue for musicians today. That’s why it’s important to consider both your short-term and long-term goals before choosing which PRO to register your works with.
Your choice could lock you out of certain opportunities, or it could cost you hundreds of dollars in potential profits. Hopefully with this information you will be able to choose the PRO that aligns best with your music and your career goals.