FAQ how do I earn money from copyright on music?
How can you make money from your copyrights? If you write or perform music, you will have to deal with intellectual property rights. Copyright and neighbouring rights are part of that. These can earn you money if your music is played, performed or sold within the Netherlands or abroad. How much also depends of what your contribution was: are you the composer/lyricist, the musician and/or the producer?
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Copyright: for composers and lyricists
Copyright arises as soon as you create work of an original nature. If you want to earn something, you must register these rights. Exploitation right is the right to make works public and reproduce them. This part of the copyright is often assigned to a copyright organisation (collective management organisation), such as Buma/Stemra.
Neighbouring rights: for performing musicians and producers
According to Neighbouring Rights Act, the creators of music are entitled to reasonable compensation when their music is played in public. This concerns the performance of the music and is therefore important for performing musicians and producers. The producer is the party who possibly made the recordings. That could be a label and if you self-publish something, then you are that yourself. Master rights also fall under this Act: this concerns the rights of the specific recording of the music. The master ownership is also important with syncs: if your music is used, for example, in an advert, film or TV series.
Collective management organisations: copyright organisations
These organisations collect copyright money from the users and then distribute this to copyright owners. As a result of this, music users do not have to make agreements with all music makers separately. These organisations also act as representatives. You can only have the exploitation rights managed by Buma/Stemra in the Netherlands. You can let Sena manage the neighbouring rights and the master rights.
Agreements on distribution
Ensure that you make good agreements with people with whom you make the music before you register this with the copyright organisation. It is customary with the exploitation rights (Buma) for one third to go to the composer, one third to the lyricist and one third to the producer/label. If you write together with your band members, agree on who gets which percentage. In the case of neighbouring rights (Sena), half of the proceeds go to the artist /musician(s) and half go to the producer or label.
What does it earn?
Sena has no legal mandate to collect a fee for on-demand music. That right is exclusively for the music company. Buma/Stemra does, however, have license agreements with online services like Spotify, YouTube, iTunes and online radio stations.
- Radio and television
The fee for the exploitation rights and the neighbouring rights are calculated via the distribution point/value per second. You are paid a certain amount per second that your music is played. The amounts per second differ per broadcaster.
Calculation examples 2020: At 3FM, a 3-minute song by Buma/Stemra yields € 8.64: 180 x € 0.048 p/s. At Radio 538 that is € 9.54: 180 x € 0.053 p/s. The fee at RTL4 is € 87.30: 180 x € 0.485 p/s.
A music video that is shown on television is also publication of music. If you wrote the song, you receive a fee from Buma, and you receive a fee from Norma for the ‘performance’ in the video. Norma only handles these fees for the large channels like NPO, RTL and SBS, so not, for example, for MTV.
Live performances are settled on the basis of a percentage of the receipts and/or fees, with the minimum compensation being a surface price. Buma applies a minimum payment of €22 per performance. The fee is determined on the basis of the set list and distributed among the rightholders concerned.
Example: you perform in a party tent and you play repertoire that you have written yourself. The receipt amount is € 15,000, the wage amount is € 5,000 and the surface of the room is 1200 m2. For this performance you will receive € 15,000 x 7% = € 1,050 copyright fee (minus administration costs and SoCu contribution) for distribution among the relevant rightholders.