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How Do Streaming Royalties Work?

Understand the two types of royalties your music earns on streaming platforms and how to make sure you're getting paid for both.

By Leonardo OrtegonJanuary 11, 2025

When your music is streamed on platforms like Spotify, Apple Music, Amazon Music, or Deezer, it generates two types of royalties: one for the sound recording and one for the composition. These royalties are paid to different rights holders and flow through separate systems.

1. Sound Recording Royalties

The sound recording royalty is tied to the actual audio file—the recorded version of the song. These royalties go to the owner of the master recording, which is typically a record label or the artist themselves if they’re independent.

Streaming platforms pay out these royalties via digital distributors such as:

  • DistroKid
  • TuneCore
  • CD Baby
  • Amuse
  • AWAL

These services collect the earnings from platforms and then forward them to the artist or whoever owns the master. The payout is not based on a fixed per-stream rate, but rather a share of the platform’s total revenue, which is divided among all streamed content. Factors like country, subscription type, and platform market share can all affect the final amount earned per stream.

2. Composition Royalties (Publishing Royalties)

The second type of royalty is based on the composition—the underlying song, including its melody, lyrics, and structure. These are called publishing royalties, and they are split into two major categories:

  • Performance royalties – collected by Performance Rights Organizations (PROs) such as ASCAP, BMI, or PRS. These are paid when your song is streamed, performed live, broadcast on TV, or played in public.

  • Mechanical royalties – collected by organizations like The MLC (in the U.S.) or MCPS (in the UK). These are paid when your song is reproduced digitally, including every time it’s streamed.

Publishing royalties are paid to the songwriter(s) and publisher(s). If you haven’t signed a publishing deal, you can still receive both the writer and publisher shares by registering as your own publisher.

Why Many Artists Miss Out on Publishing Royalties

While most independent artists are aware of and successfully collect their recording royalties, many miss out on publishing royalties simply because their compositions haven’t been properly registered. Just because a song is on Spotify doesn’t mean you’re collecting all the money it generates.

If you don’t register your works with a PRO and a mechanical rights organization, the royalties are still being generated—but they remain unclaimed. This is especially common among self-managed artists, producers, and songwriters who handle distribution on their own without a publishing partner.

The Role of a Publisher

A music publisher or publishing administrator helps ensure that your songs are registered with the necessary organizations around the world. They also:

  • Claim unpaid royalties from various territories
  • Monitor usage across streaming and media platforms
  • Provide royalty reports and accounting
  • Help resolve metadata and rights conflicts

In short, they help you collect what you’re owed.

Unlocking the Full Value of Your Music

If you've already released music to streaming platforms, you're likely earning master royalties. But unless your compositions are registered and monitored, your publishing royalties may still be sitting in the system, unpaid.

Taking the time to register properly—or partnering with a publisher who can do it for you—is the key to unlocking 100% of your streaming income. Publishing is not just an optional add-on to your career—it’s an essential part of maximizing the value of your music.