Glossary · Economics

Mechanical royalty

also filed under: mechanicals, mechanical licence

A mechanical royalty is money owed to the owner of a composition when a recording of that composition is reproduced or streamed.

The mechanism

It attaches to the composition rather than the recording, and for digital services in the United States it is administered collectively. Rates are set by regulation rather than negotiated per use.

A worked example

When a song is streamed, the recording generates money for the master owner and the composition separately generates a mechanical for the writer and publisher.

What it is confused with

Why it matters

It is the payment most often lost to registration failure, which is why it dominates the black box.

Sources: The MLC · US Copyright Office
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Related: Recoupment · Black box royalties · 360 deal