In today’s music industry, where everyone is doing song covers, remixes, and rearrangements on TikTok, there still seems to be a lot of misunderstandings and misconceptions among artists and musicians about how mechanical licensing works. I’m all for creativity, but if you want to actually make money from your renditions (and move beyond doing local gigs with your cover band), you’ll need to know the ins and outs of making income from cover songs.
In this brief Q&A, I will answer some common questions that I’ve fielded from musicians about how to go about posting song covers online and on streaming services like Spotify.
Note: Information provided is for education only and doesn’t constitute legal advice. Just a lot of common law and common sense combined with my own experiences.
I’m in a band and I want to put covers up for streaming (e.g., Spotify and YouTube), but I’m not selling them. Can I do this?
Yes, but not for free. Essentially, it comes down to for-profit use vs. non-profit use. If you’re making money from it, even if it’s $0.000003, it’s considered “for-profit” and you need to get a mechanical license. Non-profit means that you won’t accept any money from the cover song.
For example, uploading a cover song to Spotify is for-profit. Uploading it to SoundCloud (not SoundCloud Next Pro) can be non-profit, but you must ensure you don’t monetize the content in any way.
For streaming, can I upload directly to Spotify without needing any license, given their agreement with the Mechanical Licensing Collective (MLC)?
No. You still need a mechanical license to legally distribute cover songs on streaming services like Spotify.
Doesn’t the MLC collect and pay all song royalties to the original songwriter?
Not “all.” They collect mechanical royalties, which are the amounts paid each time your song gets streamed or you sell a physical copy of your CD. However, they do not collect performance royalties.
Imagine your song was in a jukebox and it was played every time you turn a hand crank. One turn of the handle and you’d get a nickel. That’s basically what a mechanical royalty pays you.
The exact payout from these royalties changes over time, but currently, it’s $0.091 per physical or permanent digital download of the song. For streaming, the rates are more complex and vary based on the service and country.
Does this only work if using a distributor like TuneCore/DistroKid? What is the correct way, and what do you recommend from experience?
Essentially, yes. When you upload your track, you’ll have to specify if it’s a cover, medley, or uses samples from another artist. If yes, this form should give you more options to fill out things like who the original artist is, their publisher, etc. Then you’ll pay something like $12 – $15 for your distributor to secure the license for you.
For YouTube, is We Are The Hits the only legit service to get the licenses needed? Does this video live on my YouTube channel or the original artist’s channel? Any other advice as it relates to YouTube?
We Are The Hits is a legitimate service for licensing cover songs on YouTube, but it’s not the only one. The video will live on your YouTube channel. Another option is to obtain a synchronization license directly from the copyright holder.
Regarding ISRC codes & PROs, for cover songs, do I need ISRC codes and how do I get them?
Yes, ISRC codes are necessary as they are used to uniquely identify recordings. These will typically be created for you by your distributor.
Do I register my cover songs with PROs?
No, you do not register cover songs with Performance Rights Organizations (PROs) for the purpose of collecting royalties. PROs handle performance royalties, which cover songs don’t usually earn unless you significantly change the arrangement.
Do instrumental covers count as cover songs since they do not have lyrics and words?
Yes, instrumental covers still count as cover songs since they use the original composition.
Getting a Mechanical License for Songs through Koshiz Music
As a songwriter and music publisher, I make it super easy for you to browse my music and get a mechanical license. I’m a one stop shop. That means no nonsense, no convoluted spiderweb of songwriters and record labels to deal with. And, because its just you and me, I can offer more favorable terms that are simple easy to understand.
Just browse my song catalog, find a song you like, proceed through checkout and that’s it! I’ll take care of the publishing admin side, you just keep in contact whenever you’re ready to have the song registered with the PRO and MLCthe song’s release.
Hope to hear you around soon!
