During my vacation I’ve browsed through a lot of radio channels and every one was playing the new Miley Cyrus Song at some point and very frequently and I asked myself how she or any other artist earn money from the radio stations.
Does the artist really get a certain amount for every time the song gets played on any station on any country or does she like sell the rights to play the song as much as the radio stations want for a certain amount? How does it work?
I’m specifically asking about radio, not Spotify or smth similar.
Thanks!
In: 2
Radio stations pay a licensing fee to performing rights organizations (in the US there are two — BMI and ASCAP). This fee is based on the number of listeners (determined by companies such as Nielsen) and gives the radio station the right to broadcast the entire catalog of the ASCAP and BMI composers. The radio stations typically submit a log of the songs they have played to ASCAP and BMI who then tally the number of plays of each song multiplied by the audience rating and pay a share of the total royalties collected (the fee the radio station paid) to the composer and publisher of the song (but not to the artists performing the song).
This is why Paul McCartney (as both a publisher and composer) is a billionaire but Ringo is not. Note that Paul also controls the publishing of many songs by Buddy Holly, the musicals Grease and The Sound of Music and numerous other popular songs.
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