What does Performance Royalties mean in the music industry?

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Payments to songwriters and publishers when their composition is publicly performed, broadcast, or streamed. Collected by PROs like ASCAP, BMI, and SESAC and distributed to the writers and publishers who own the underlying composition.

Performance Royalties Definition | Music Industry Glossary

In-Depth Explanation

Performance royalties are payments made to songwriters and music publishers when their musical composition is publicly performed, broadcast, or streamed. These royalties are collected by Performance Rights Organizations (PROs) such as ASCAP, BMI, and SESAC, which license businesses to play music and distribute the fees to the writers and publishers who own the underlying composition.

How Performance Royalties Work

Performance royalties are rooted in copyright law: if a business uses your music to entertain customers or attract an audience, you deserve compensation. A "public performance" covers a broad range of uses:

Terrestrial radio and TV: AM/FM radio stations, network television, and cable broadcasts.
Digital streaming: Interactive platforms (Spotify, Apple Music) and non-interactive platforms (Pandora, SiriusXM).
Live venues: Concerts, festivals, and clubs where songs are performed live (including cover songs).
Public businesses: Restaurants, bars, retail stores, gyms, and hotels playing background music.

It is impossible for a songwriter to track every coffee shop or radio station that plays their song. PROs solve this by issuing Blanket Licenses to businesses. A business pays a flat annual fee for the legal right to play any song in the PRO's catalog. The PRO pools these fees, tracks usage through digital metadata logs and statistical sampling, deducts an administrative fee, and distributes the rest to affiliated songwriters and publishers.

In the US, the major PROs are ASCAP, BMI, SESAC, and GMR. ASCAP reported record-breaking revenue of $1.945 billion in 2025, distributing $1.759 billion to its 1.1 million members. ASCAP operates as a non-profit with a 10% overhead rate. BMI operates as a for-profit with a 15% overhead rate. In the UK, the equivalent organization is PRS for Music.

The Writer's Share vs. The Publisher's Share

When a PRO collects a performance royalty, it splits the money into two equal halves:

Writer's Share (50%): Paid directly to the songwriter(s). This money bypasses any publishing company entirely. Even if you sign the worst publishing deal in history and give away 100% of your copyright, the PRO sends the Writer's Share straight to your bank account.
Publisher's Share (50%): Paid to the entity that owns or administers the Publishing Rights. If you are independent with no publisher, you collect this 50% as well (you are your own publisher). If you signed a co-publishing deal, the publisher takes half of this share (25% of the total) and you keep the other half (25% of the total).

Performance vs. Mechanical Royalties in Streaming

When a user streams a song on Spotify, the platform pays two separate publishing royalties simultaneously:

Performance royalty: Paid because the song is being transmitted (performed) digitally to the public. Collected by your PRO (ASCAP, BMI).
Mechanical Royalty: Paid because a temporary digital copy of the audio file is created on the user's device. Collected by a mechanical society (The MLC in the US).

Many independent songwriters register with a PRO but never set up mechanical royalty collection. They leave money on the table with every stream.

Real-World Example

A songwriter named Elena writes a song that gets 500,000 spins on Spotify in one quarter. She is registered with ASCAP and uses a publishing administration service for mechanicals.

Performance royalty (ASCAP): ASCAP collects the performance share from Spotify and pays Elena the Writer's Share directly. Since she is her own publisher, she also receives the Publisher's Share. Total from ASCAP for this quarter: approximately $180.
Mechanical royalty (The MLC): The MLC collects the mechanical share from Spotify. Elena's publishing admin collects this on her behalf (minus a 10% admin fee). Total from The MLC: approximately $45.

Elena earns $225 total from publishing royalties on 500,000 streams. This is separate from the master recording royalty that her distributor pays her. If she had only registered with ASCAP and not The MLC, she would have forfeited the $45 mechanical portion.

Why It Matters for Independent Artists

If you write your own songs and do not belong to a PRO, you are giving away performance royalties with every stream, every radio play, and every live performance. Joining a PRO is free (ASCAP and BMI) or invitation-based (SESAC). Register every song you release. Submit your live setlists through your PRO's live performance reporting tool (ASCAP OnStage or BMI Live) to claim royalties from your own gigs.

For a full comparison of PRO options, read our PRO comparison guide. For step-by-step registration instructions, see our guide on how to register your music with a PRO. To make sure you are collecting every royalty type you are owed, read our guide on all the music royalties you should be collecting.