What does Neighboring Rights Society mean in the music industry?

Neighboring Rights Society Definition | Music Industry Glossary

In-Depth Explanation

A Neighboring Rights Society is a Collective Management Organization (CMO) that collects and distributes royalties to recording artists and record labels when their master recordings are broadcast on radio, television, or digital platforms. These organizations function like PROs but serve the owners of sound recordings rather than songwriters.

How a Neighboring Rights Society Works

A PRO like ASCAP or BMI collects performance royalties for songwriters and publishers when a composition is broadcast. A Neighboring Rights Society does the same job but for a different group of rights holders: the recording artists and record labels who own the Master Recording.

When a radio station, television broadcaster, nightclub, or digital service plays a recorded song, they must pay for the right to use that specific recording. The neighboring rights society issues blanket licenses to broadcasters, collects the fees, tracks which recordings were played, and distributes the money to the rightful owners.

By international convention, the collected money is typically split 50/50:

50% to the copyright owner of the sound recording: Usually the Record Label that funded the recording session.
50% to the performers: Paid directly to the featured artist and non-featured musicians (session players, backup singers) who performed on the track.

The performer's share is paid directly to the artist by the collection society, bypassing the record label entirely. The label cannot use this money to recoup an Advance.

Major Neighboring Rights Societies

Almost every developed country has a designated neighboring rights society, often government-mandated:

United States: SoundExchange collects only for digital non-interactive broadcasts (SiriusXM, Pandora, internet radio). The US does not pay neighboring rights for terrestrial AM/FM radio.
United Kingdom: PPL (Phonographic Performance Limited).
Canada: Re:Sound (works with CONNECT and MROC).
France: SCPP (for labels) and SPEDIDAM/ADAMI (for performers).
Germany: GVL.
Australia: PPCA.

SoundExchange is the largest neighboring rights collective in the world. As of March 2026, it has distributed over $13 billion to recording artists and rights owners since its founding in 2003. In 2025 alone, SoundExchange distributed approximately $991.5 million. The organization also maintains collection agreements with counterpart organizations covering roughly 91% of the global neighboring rights market, having signed 17 new agreements with CMOs in 2025 alone.

Real-World Example

An independent artist self-releases an album and registers it with SoundExchange. The album gets airplay on SiriusXM and Pandora in the US, generating $1,200 in neighboring rights royalties. SoundExchange collects the money, splits it 50/50, and pays $600 to the artist as the master owner and $600 to the artist as the featured performer. The artist receives the full $1,200 because they own both rights.

The same album also gets played on BBC Radio 1 in the UK, generating 200 GBP in royalties held by PPL. And it gets played on German radio, generating 500 EUR held by GVL. If the artist is only registered with SoundExchange, they will never see the money sitting in the UK or Germany unless they also register directly with PPL and GVL, or use a neighboring rights administrator who handles global registration on their behalf.

Why It Matters for Independent Artists

If your music is played on any non-interactive digital service (SiriusXM, Pandora, internet radio) or broadcast internationally, neighboring rights royalties are being generated right now. If you are not registered with the appropriate society, that money sits unclaimed and eventually escheats to the government or gets absorbed by the society.

Three steps to collect what you are owed:

Register with SoundExchange if you are a US artist. It is free, and it is the only way to collect digital performance royalties from SiriusXM, Pandora, and similar services. See our guide on SoundExchange royalties and how to collect them.
Register internationally. If your music has global reach, sign up with a neighboring rights administrator who will register your catalog with PPL, GVL, PPCA, and other societies worldwide. They typically charge 15-20% of collected royalties.
Register before your music gets played. Most societies hold unclaimed royalties for a limited time (often three to five years). After that, the money is gone permanently.

Read our full breakdown on neighboring rights and international royalties you may be missing and our guide to the best royalty collection services for independent artists in 2026.