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The Best Way to Make Money with Music

"I walked out of the Chinese restaurant with a fat check, a record deal, and a box of shrimp egg foo yung! I was signed to MGM. I was in Vegas for sixteen weeks at the Sands Hotel". - Solomon Burke

The best way to make money in music is to be the writer. Yes the songwriters are the ones collecting the royalties. If you are responsible for writing a song that goes on to sell a million copies, the mechanical royalties alone are $566,250, and then there's performance and residual royalties from other markets.

The only way to make more than a songwriter is to combine that with being the recording and performing artist who makes the song popular. If this is the case, there are almost endless money making opportunities and not just in music. In addition to musical performances and CD sales artists now make money from product lines and endorsements, music and ring tone downloads, personal appearances etc. etc. But this section will focus on how the songwriter makes money.

"I was forced to be an artist and a CEO from the beginning, so I was forced to be like a businessman because when I was trying to get a record deal, it was so hard to get a record deal on my own that it was either give up or create my own company". - Jay Z

The Business of Music

You’ve heard a lot of fairy tales and myths about the music industry but really it’s pretty straightforward. The music business is like any other business, you make a product and sell it and hopefully there is a large demand for your product. You as a songwriter are entitled to a portion or percentage of each product sold that you helped create.

"You get quick money, it's beautiful, there's sunshine, but at the end of the day, you find out it's all a masquerade, baby. It's not what it seems". - Wyclef Jean

The whole music industry is based on percentages of potential earnings. You must retain the rights to your material. You will usually be asked to "split" royalties with your publisher or the record label, and this is normal. But never, under any circumstances give up all your rights to your songs!

"Most artists have contracts directly with the record company, and when they do music, all of their music is owned by the record company. But I did mine through a production company". - Roy Ayers

How songwriters make money
As a songwriter, your path to the money is fairly short. A songwriter makes money when a CD containing their song gets sold. You will also make money if your song is played on the radio, in a TV show, broadcast in a foreign country, or performed in a motion picture or as part of a theatrical production. Each source of revenue has it’s own payment structure and organization, sometime making it difficult to determine where the income is coming from. Let’s take a look at the music business from the songwriter’s point of view.

"A song that sounds simple is just not that easy to write. One of the objectives of this record was to try and write melodies that continue to resonate". - Sheryl Crow

Publishing and Royalties
Mechanical Royalties – sometimes known as reproduction rights. A mechanical royalty is earned for any "phonorecord", including CDs, tapes, vinyl, and digital downloads that is manufactured and distributed with a copyrighted song on it. This also means the right to copy your work, which refers to any mechanical reproduction.

"And you have a record company behind it, this is a key too, you need people to fight for your records, at least a little bit. So if you have a great song, it's catchy, and you've got a little bit of help, I think that's all you need." - Joan Jett

Performing Royalties – also referred to as performing rights. This is the right to perform the work in public. This performance may be a live performance, a recording or any other type of performance. This also includes the right to communicate by telecommunication to the public. (Radio, TV and satellite and Internet retransmissions) A copyright owner automatically owns the performing rights, along with other rights that make up a copyright. A performance royalty should be paid if your song is performed live in public or broadcast.

"I never take on anything that is just for the money or just for, you know. I always have to connect with it in a very personal way because I believe the audience will sense whether I'm into it or not, so I don't take on projects that I'm not really passionate about". - Deborah Cox

Synchronization Rights - A synchronization royalty is paid when the song is synchronized with visual media, like television programs, commercials, and films.

Other rights - The right to assign the work, moral rights to the work and the right to modify the work, are a few of the other various rights covered under copyright law.

by - Jeff Muller, author of Write Hit Songs and Get Paid

If you would like more information about getting your songs published and how to retain your rights so you get the big slice of the money pie, this book can help.

More about Write Hit Songs

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