Very interesting read.

https://www.reddit.com/r/explainlik...oes_a_composer/

Composers and songwriters are paid by performing rights organizations or PROs for short. There are three in the US and one in every other country. They are ASCAP, BMI, and SESAC. I have included their websites at the end of this post if you want to go directly there to learn more. Basically, radio, tv, restaurants/bar, the web, etc. (Anywhere music is played AND money is made) must pay a fee to each of these companies. A songwriter can only be signed to one of these companies. They gather the money and distribute the royalties. Most songwriters are paid quarterly. They are generally paid three quarters behind so it can take some time to be paid for your songs. Also, songwriters need to register their songs in order to be paid. It is free to join SESAC if you meet with a rep. It is a very small fee ($50) or something close to that for ASCAP or BMI and can be done online. Also, it is hard to say for a #1 - depends on the genre But it will be substantial. Keep in mind, most songs are written by several people and those people often have publishers so it can be quite complicated and that number will be split and split again. You can learn more at www.sesac.com, www.bmi.com, and www.ascap.com.
To answer the other question below. These companies either use their own in house monitoring service to see which and when songs are played. Or they may use Nielsen Soundscan which is pretty much the industry standard. There are also companies that monitor the internet and pay songwriters for plays they find online and then pay songwriters either on their own or through one of the performing right companies mentioned above. One is called TuneSat, but there are others too.

Mechanicals: these are easy. The rate is set by the government and is paid on a per-sale basis at $0.091 per song sold, and that amount is divided up amongst the songwriters (so if there are two writers, each one of them gets $0.0455 for every song sold). They're collected and administered by either the record labels (who receive the gross money for the sale and pay everyone out) or in the case of cover songs, a company called the Harry Fox Agency. These payments are usually semiannual but sometimes quarterly.

Performance: this is a much wider net. Is your song in a TV show? Every time it plays you'll receive SOME money - how much is up to a complex formula based system put in place by the "Performance Rights Organizations" (i.e. ASCAP, BMI, SESAC, GMR, etc). I've made anywhere from 3 cents to over a thousand on a single TV play (depending on how long they use it, what time of day, how many people watch the show, what network, etc). Radio plays are also paid to the writers per play, and can be up to $15 per station per play. So if your song is getting 2000 spins a week (i.e. a hit song), that's $30k per week to split amongst the writers. Not bad. The PRO's all have different pay schedules, but to make things easy let's say they're basically quarterly.

Streaming comes through both lanes depending on if you're published and how the song is released. Spotify/Pandora will usually come through the PRO (sometimes the former through the route of the mechanical). The rub with these services is that the music labels will license the song to them extra cheap in exchange for stock on the company or large non-specific advances that they don't have to pass along to the artists/writers - no bueno. Which is why artists/writers are complaining about streaming while the corporate side is suspiciously silent..

And lastly if you are the artist you'll get an additional artist royalty from the label once you've made back the money they spent on you (or making your album). Producers are entitled to a similar royalty, albeit much smaller. And then there's this thing called "neighboring rights" in other countries where the people who performed on the song (musicians, producers, artists) and the label owners get an additional performance royalty for that - but that is for another day.

Fun fact: Simon Cowell's X Factor/ idol artists (one direction etc) almost all include musical samples played by Cowell (eg a single tambourine hit) on their records, so that Cowell personally receives PRS as a performer.
Source: am in industry and know a writer for Olly Murs/1D

Fun fact 2: while we're on the subject, there is a music production company that specialises in quite literally adding 'the one direction kick drum' to other people's work. They get paid a shocking amount for this.

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