American Songwriter: Songwriter U - Are You Getting All Your Streaming Money?

As a songwriter myself, I recognize how difficult copyrights, licensing and royalties can be to understand, and I know all too well about the struggles many songwriters have encountered over the years trying to collect all of the royalties owed to them, particularly mechanical royalties. 

Fortunately, New Year’s Day 2021 marked the beginning of a new era in mechanical licensing. That day, The Mechanical Licensing Collective (The MLC) officially began operations, which will significantly impact self-administered (also known as self-published or independent) songwriters and how they receive mechanical royalties moving forward.

Long-standing Issues with Mechanical Royalties
Mechanical royalties (which are separate from performance royalties songwriters may collect through performance rights organizations) have long been a source of frustration for songwriters and other copyright holders because there was no efficient way for them to be collected and distributed. For decades, mechanical royalties were largely a matter for publishers to deal with, while for smaller music publishers and independent songwriters, they often went uncollected entirely.  

The emergence of digital service providers (DSPs) like Apple Music and Spotify offering music online, and their enormous popularity, complicated things even further. Securing the proper mechanical licenses required that DSPs research every single song they wanted to use and identify the copyright holders associated with each one. And in the case of songs with multiple writers, it often meant multiple copyright holders as well.  

With millions of tracks available on multiple platforms and new music being added to them every day, securing that many licenses became essentially impossible. The DSPs struggled to keep up and as a result, songwriters, composers, lyricists and publishers missed out on the money they had rightfully earned. 

The Solution: A New Era Begins 
A solution was badly needed, and one finally came in 2018 when Congress passed the historic Music Modernization Act (MMA). The legislation implemented a more efficient and effective way for DSPs to license the musical works they make available on their platforms and ensure that rightsholders were paid the mechanical royalties they’re owed for that usage. 

The MMA created The MLC, designating it to be the sole administrator of a new blanket mechanical license (also established by the law) and the exclusive distributor of mechanical royalties to rightsholders based on the usage under those licenses. 

As part of its operations, The MLC built both a publicly accessible database of musical works and The MLC Portal, the online tool MLC Members use to register their musical works data and then maintain and update that data. 

Here’s how it works
A fan listens to a song on their favorite music service. The service reports that usage to The MLC, which then matches that song to its database of publishers, composers, lyricists and songwriters. The musical works in the database have been checked for accuracy by songwriters and publishers themselves, making it easier for The MLC to match the usage correctly and compensate the proper rightsholder or rightsholders, which it does through monthly royalty payments. 

As one of several songwriters who sits on The MLC’s Board of Directors, I believe the new blanket license will make the process of collecting mechanical royalties much easier and help The MLC accomplish what I see as one of its most important goals: getting that money into the hands of songwriters. But for that to happen, you must first join The MLC.  

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