--- title: The music business glossary publisher: RapCanon canonical: https://rapcanon.com/glossary/ license: CC-BY-4.0 retrieved: 2026-08-12 --- > What the industry's own terms actually mean and what each one does to the money. 30 entries, each with the mechanism, a worked example and a primary source. Published as an open CC-BY dataset. Lexicon # The terms the industry uses, and what each one does to the money. Most of these words are explained badly on purpose. A term nobody understands is a term nobody negotiates. Every entry gives the definition, the mechanism, a worked example and a primary source, and the whole set publishes as an open dataset. 30 entries CC-BY 4.0 as_of 2026-08-12 Credits Credits ### Interpolation An interpolation is the re-recording of a melody, lyric or other element of an existing composition, rather than the use of the original recording itself. Credits ### ISRC An ISRC is a unique identifier for a specific sound RECORDING, used to track that recording across platforms and reporting systems. Credits ### ISWC An ISWC is a unique identifier for a musical WORK, meaning the underlying composition rather than any particular recording of it. Credits ### Split sheet A split sheet is a written record of what percentage of a composition each contributor owns, agreed at the time the song is made. Economics Economics ### 360 deal A 360 deal is a recording agreement in which the label takes a percentage of income streams beyond recorded music, such as touring, merchandise, endorsements and publishing. Economics ### Advance An advance is money paid to an artist up front against future earnings, charged to the artist's account and repaid out of their share of revenue. Economics ### Audit clause An audit clause is the contractual right for an artist to examine a label's or distributor's books to verify that royalties were calculated and paid correctly. Economics ### Breakage Breakage is money a label receives from a digital service that is not attributable to any specific artist's usage, such as advances, minimum guarantees and equity. Economics ### Controlled composition clause A controlled composition clause reduces the mechanical royalty a label pays a songwriter-artist on songs that artist wrote or controls, and typically caps how many songs per album are paid at all. Economics ### Cross-collateralisation Cross-collateralisation is a contractual term allowing a label to recover the unrecouped balance of one project out of the earnings of another. Economics ### Distribution fee A distribution fee is the percentage a distributor takes for delivering recordings to streaming services and stores and collecting the resulting revenue. Economics ### Escalator An escalator is a contract term that increases an artist's royalty rate once defined sales or streaming thresholds are reached. Economics ### Mechanical royalty A mechanical royalty is money owed to the owner of a composition when a recording of that composition is reproduced or streamed. Economics ### Per-stream rate A per-stream rate is not a fixed price paid per play; it is an average derived after the fact by dividing a service's payable revenue pool among rights holders by share of total streams. Economics ### Playlist placement Playlist placement is the inclusion of a track on a streaming service's editorial or algorithmic playlist, which raises stream volume and therefore payout. Economics ### Points A point is one percentage point of the artist royalty on a recording, most often used to describe a producer's participation. Economics ### Pro-rata versus user-centric Pro-rata and user-centric are two ways of dividing a streaming service's subscription revenue among rights holders. Economics ### Recoupment Recoupment is the process by which a record label recovers money it advanced to an artist out of the artist's share of revenue only, rather than out of total revenue. Economics ### Streaming fraud Streaming fraud is the generation of plays that do not correspond to genuine listening, whether bought by the artist, arranged by a third party, or run against a catalogue without its owner's knowledge. Economics ### Sync licence A sync licence is permission to synchronise a piece of music with visual media such as a film, television programme, advertisement or game. Ownership Ownership ### Administration deal An administration deal is an agreement in which a publisher registers, collects and licenses a writer's catalogue for a percentage fee, without taking ownership of the copyrights. Ownership ### Black box royalties Black box royalties are royalties that were successfully collected but could not be matched to the person or company entitled to them. Ownership ### Co-publishing deal A co-publishing deal is an agreement in which a writer keeps their writer's share and gives up part of the publisher's share in exchange for an advance and publishing services. Ownership ### Master versus composition Every piece of recorded music contains two separate copyrights: the composition, which is the underlying song, and the master, which is the specific recording of it. Ownership ### Neighbouring rights Neighbouring rights are performance royalties paid for the use of a sound RECORDING, as distinct from the performance royalties paid for the underlying composition. Ownership ### Performing rights organisation A performing rights organisation licenses the public performance of compositions on behalf of writers and publishers, collects the resulting money, and distributes it to its members. Ownership ### Publishing Publishing is the business of owning, administering and exploiting the composition, which is the song itself, as distinct from any particular recording of it. Ownership ### Reversion Reversion is the return of rights to their original owner, either because a contract term provided for it or because a statutory right allows a transfer to be terminated after a defined period. Ownership ### The MLC The Mechanical Licensing Collective is the body created by the Music Modernization Act to administer the blanket mechanical licence for digital services in the United States and to pay the resulting royalties to rights holders. Ownership ### Work for hire A work for hire is a work whose legal author, from the moment of creation, is the party who commissioned or employed the creator rather than the creator themselves. --- ## How to cite this page **APA** RapCanon. (2026). The music business glossary. Retrieved from https://rapcanon.com/glossary/ **BibTeX** ```bibtex @misc{rapcanon-the-music-business-glossary, title = {The music business glossary}, author = {{RapCanon}}, year = {2026}, url = {https://rapcanon.com/glossary/}, note = {Accessed: 2026-08-12} } ``` **Wikipedia** ``` {{cite web |title=The music business glossary |url=https://rapcanon.com/glossary/ |publisher=RapCanon |access-date=2026-08-12}} ``` Licensed CC-BY 4.0. Reuse it, including commercially, with attribution and a link back. Canonical HTML: https://rapcanon.com/glossary/