Performance Rights Organizations: Who, What, When, How, Why

Here at HillTop Records, we’ve been getting a lot of letters from our songwriters asking about Performance Rights Organizations. Who are they? What do they do? Who can join? Should I join? Which one should I join? We understand that this can be a confusing part of the music industry, and we’d like to help clarify as much as we can. So in the same way that we explained royalties in a previous post, we will attempt to break down the PROs.

Who
In the United States, there are three performance rights organizations: ASCAP, BMI and SESAC. Of these, SESAC is by far the most difficult to join—unless, of course, you are already enjoying great success in your songwriting and publishing career. Until that happens, your options are most likely limited to BMI and ASCAP. ASCAP was founded by composers, authors and music publishers—and these are the people who still run the organization today. BMI is, on the other hand, run by broadcasters. Many songwriters ask which of the two PRO’s they should join, but the answer really lies in your own personal preference. Both ASCAP and BMI are highly competitive entities, and both are well respected in the music industry.

What
All three U.S. PRO’s perform the same functions: They license public performances of their members’ music (including on TV, radio, in nightclubs, on web/podcasts, in stores and restaurants, and in other public venues) and collect performing rights royalties on behalf of members. They distribute those royalties to their members, minus any administration costs. PRO’s only deal with non-dramatic (ie. not musical theater) performing rights, and they do not handle other types of royalties (like mechanical or synchronization royalties.)

When
As it is the PRO’s job to collect and distribute royalties, the organization must also monitor its members’ music. Whenever a song is played on the radio, the PRO to which the owner of the song belongs is in charge of obtaining the royalty fee. The same goes for whenever a song is played on a TV show or in a film (typically on the soundtrack.) In these instances, the PRO uses what is called a “cue sheet” (a form or electronic file that details when and how loudly a song is played during a program) to track when members’ music is used in a production. The film or TV producer must fill out the cue sheet and submit it to each PRO who has a member represented. The fees are then paid by the broadcaster. Of course, it is much easier to track the music being played on the radio and in film/TV than it is to monitor music being played in “unmonitored” arenas, like bars and boutiques. In reality, a lot of performances can slip through the cracks. However, it is technically still the PRO’s job to collect performing royalties whenever a song is played. If you are ever in a public place and hear your song being played, you should tell your PRO so that they can collect the royalties for you.

How
The application process for BMI and ASCAP is fairly straightforward. You can visit their respective websites (either http://www.bmi.com/ or http://www.ascap.com) and apply for membership online. All of the paperwork is there, and you can even pay your one-time entry fee (this varies; contact the PRO directly for more info) online.

The PRO’s are most likely to accept you if there is a reasonable chance that your music will be played in the media or in a public setting (as either constitutes a “performance”) in the near future. If your songs are available to download online (like, for example, on the HillTop Records homepage) or if you have your own personal website and are promoting yourself, there is a pretty good chance that you will be accepted. If you are not accepted, don’t worry—that does not mean that your music is not good! It just means that the PRO in question does not believe that you as yet need their services.

Please note that in the case of a band or musical group, only the songwriter need apply for PRO membership. PRO’s represent songwriters and publishers. As a songwriter, you are only allowed to belong to one of the three organizations (BMI, ASCAP or SESAC.) However, as a publisher, you can belong to all three—and many publishers do, for an important reason: A publisher can only publish songs written by a member of the same organization to which he/she belongs. Therefore, if you wish to publish another writer’s works, you must join the same PRO. If you are planning to self publish, you must join as a writer and publisher—and provide a name for your publishing company. In this case, you would receive payment for both being the writer and the publisher (so yes, you would get paid twice.).

If you happen to be the co-writer of a song, you can join one PRO and your writing partner can join the other with the same song, as long as your song percentages (say, 50/50) are cross-registered to match. This would actually be a great way to compare the pros and cons of each PRO, as it is otherwise difficult to say whether one is better than the other.

Why
The reason for joining a PRO is simple: to make sure that you are paid the appropriate performance royalties. Songwriters often ask why they should choose ASCAP over BMI, or vice versa. And, like we said before, it’s really a matter of personal preference. Both organizations claim to be the best in the business, and it is difficult to fairly compare the two. The “better” one would, in theory, be the one that pays more—but which one is that? The amount of money you make can vary drastically per song. There are so many factors in play, from where a song is on the charts to how the competition is doing. No two songs are ever doing the exact same thing on the charts while at the same time getting the most cover recordings and other performing rights, so it is nearly impossible to track how the royalty rates vary by PRO. The best way to do this would be the example we mentioned above—splitting the rights to a song 50/50, and comparing the checks sent by both PRO’s. In the meantime we recommend checking out both organizations’ websites or calling to speak with a representative directly. Get a feel for each PRO, and then decide which is the better fit for you.