Mechanical Royalty
Payment to songwriters and publishers when their composition is reproduced on physical media or as a digital download.
Definition
Mechanical royalties are payments owed to songwriters and publishers when their musical composition is mechanically reproduced—originally referring to physical formats (CDs, vinyl) but now including digital downloads and interactive streams. The term dates to player piano rolls, the first mechanical music reproduction.
Mechanical rates in the US are set by the Copyright Royalty Board. For physical and downloads, it's currently 9.1 cents per song (or 1.75 cents per minute for songs over 5 minutes). Streaming mechanicals are calculated through complex formulas involving royalty pools and subscriber revenue.
Why It Matters
Mechanical royalties are a significant income stream for songwriters, separate from performance royalties. Understanding mechanical rights ensures proper compensation when songs are released by others, included on compilations, or streamed on interactive platforms.
For artists releasing cover songs, mechanical licenses must be obtained and royalties paid to original songwriters.
Examples in Practice
A songwriter whose composition is covered by a major artist receives mechanical royalties from every album sale and download.
An independent artist uses mechanical licensing services to legally release a cover song, paying statutory rates to the original publishers.
A hit song's mechanical royalties compound across physical sales, downloads, and billions of streams, generating substantial ongoing income.