In the complex landscape of the music industry, navigating royalty collection and rights management can be a complicated journey. To simplify matters, let's look at the roles of two vital entities: the Mechanical Licensing Collective (The MLC) and the Performing Rights Organization. Here we’ll answer the question: do you, as a songwriter, composer or lyricist, need both?
First, let's shed some light on PROs. These organizations serve songwriters, composers, lyricists and music publishers. Their primary mission? To grant public performance licenses and collect and distribute royalties for public performances of musical works (aka songs). These public performances encompass a broad spectrum, from radio and television airplay to live concerts and digital streaming.
PROs track these performances and ensure that song creators and affiliated rightsholders receive the compensation they deserve. If you're a songwriter, composer, lyricist or music publisher, signing up with a PRO is an important step in receiving compensation for your work. The most widely known PROs in the United States are ASCAP, BMI and SESAC and GMR. A new one called AllTrack recently launched.
Now, let's talk about The MLC, a relatively newer player in the music royalties game. Established as a requirement of the Music Modernization Act (MMA) in the United States, The MLC focuses on a specific type of licensing and royalties: mechanical licensing and royalty collection for digital uses.
What exactly does that entail? The MLC's core mission involves collecting and distributing mechanical royalties derived from interactive streaming services and digital downloads. In essence, The MLC makes sure that publishers and self-administered song creators receive their royalties for the reproduction and distribution of their songs on certain types of digital services.
So, what’s the difference?
Both PROs and The MLC deal with royalties and rights in the music industry. However, they have distinct purposes and responsibilities.
PROs handle performance royalties, ensuring that song rightsholders are compensated when their songs are publicly performed. The MLC, on the other hand, pays song rightsholders their mechanical royalties for the digital reproduction and distribution of their music.
So, the question remains: Do you need both a PRO and The MLC? The answer is YES! Given that The MLC and PROs handle distinct types of royalties for songwriters, it's essential to establish connections with both. If you opt to have a third party, such as a publisher or publishing administrator, manage the collection of your mechanical royalties, they will take care of the royalty collection process with The MLC on your behalf. In the ever-evolving world of music, having these two entities by your side can help ensure that your creative endeavors are not only protected but also rewarded financially.