SoundExchange and Digital Performance Royalties

SoundExchange collects and distributes a particular kind of U.S. royalty: royalties connected to eligible, noninteractive digital transmissions of sound recordings. That can include certain internet webcasting services and some satellite or subscription digital-audio services. It does not mean that SoundExchange collects every royalty generated by streaming, radio, downloads, or video.

The most important distinction is between an interactive service, where a listener chooses a specific recording on demand, and a noninteractive service, where the service determines the programming within statutory limits. The ordinary Section 114 SoundExchange pathway is designed for eligible noninteractive digital audio transmissions. Interactive on-demand services and downloads generally use negotiated licenses for sound recordings instead. Their musical-work royalties follow separate routes.

If you are a featured artist or own the copyright in a sound recording, registering with SoundExchange can help you claim royalties that may otherwise remain unmatched or unpaid. Registration is free, but it does not guarantee that money exists or that every claim will be accepted. You still need accurate ownership information, recording metadata, payment details, and a service whose use falls within the applicable royalty system. Frequently Asked Questions explains SoundExchange’s collection role and the difference between featured artists, sound-recording copyright owners, and musical-work rightsholders.

Start with the two copyrights

A recorded song normally involves at least two separate copyrights. The musical work is the underlying composition: the melody, lyrics, and other songwriting elements. The sound recording is the particular recorded performance captured in a file or master. These copyrights can have different owners. A songwriter may own or share the composition, while an artist, label, or other party may own the sound recording.

This separation matters because different uses can create different royalties for different rightsholders. SoundExchange’s ordinary role concerns the sound-recording side of eligible statutory digital transmissions. It does not currently collect or distribute the songwriter or publisher royalties attached to the musical work. Licensing 101 describes the two-copyright structure, while the U.S. Copyright Office’s statutory-license overview explains why digital services may need authorization for both musical works and sound recordings. Notice and Recordkeeping for Use of Sound Recordings Under Statutory License provides that regulatory context.

A useful way to think about the system is as two parallel tracks:

• The sound-recording track asks who performed on or owns the master and whether the recording was used in an eligible digital transmission.
• The musical-work track asks who wrote, published, administered, or otherwise controls the composition and what kind of use occurred.

SoundExchange is primarily part of the first track. It should not be treated as a universal registration service for all music income.

What SoundExchange royalties cover

The ordinary Section 114 pathway covers eligible noninteractive webcasting and certain subscription or satellite digital-audio services. A noninteractive service generally provides programming without allowing a listener to select and play any particular recording whenever the listener wants. Statutory eligibility also depends on service definitions, compliance conditions, and reporting requirements. Licensing 101 describes the relevant service categories and explains that different types of services can have different licensing obligations.

The statutory framework is limited. Section 114 establishes a limited public-performance right in sound recordings for certain digital audio transmissions, along with statutory licensing and rate-setting provisions. Chapter 1—Circular 92: Section 114, Scope of Exclusive Rights in Sound Recordings sets out that framework, including the statutory allocation of receipts.

Do not assume that the name of a platform tells you whether a particular use is covered. A company may offer more than one type of product, and the relevant question is the service’s actual functionality and licensing arrangement. The packet does not support treating interactive services such as Spotify, Apple Music, or Tidal as ordinary SoundExchange noninteractive statutory-license services. Avoid estimating your SoundExchange income from a generic stream count, because the packet contains no authoritative support for a claim that 100,000 Spotify streams produce a particular SoundExchange payment or that internet and satellite royalties add a fixed percentage to other income.

What SoundExchange generally does not collect

Several common music uses fall outside the ordinary Section 114 SoundExchange route.

Interactive on-demand streaming is outside the statutory license administered under Section 114. In an interactive service, the listener can choose a specific recording on demand. Such services may pay sound-recording owners under negotiated licenses, but that is a different path from SoundExchange’s ordinary statutory collection route. 2026 Commercial Broadcaster Memo expressly distinguishes eligible noninteractive digital audio transmissions from interactive streaming and downloads.

Downloads are also outside the ordinary Section 114 statutory license. A download is not the same type of transmission as a noninteractive digital broadcast. Sound-recording income from downloads may be governed by negotiated arrangements, while the composition may generate separate royalties.

Terrestrial over-the-air radio is another important exclusion in the current U.S. framework. SoundExchange states that it does not collect or distribute the ordinary U.S. sound-recording performance royalties for traditional terrestrial radio. That does not mean radio creates no value for artists or that every country treats radio the same way. It means that, as of the evidence date, the ordinary U.S. SoundExchange pathway is not the collection route for those over-the-air sound-recording performances. Frequently Asked Questions states this limit.

Podcasts and video are also outside the ordinary Section 114 pathway described here. A podcast may involve separate permissions and royalties, and a video may involve multiple rights, but neither should automatically be treated as a SoundExchange statutory digital-audio transmission. 2026 Commercial Broadcaster Memo identifies podcasts and the relevant excluded uses.

SoundExchange also does not currently collect the musical-work royalties owed to songwriters and publishers. For eligible interactive streaming and download services, The Mechanical Licensing Collective administers the U.S. blanket mechanical license for musical works and distributes those royalties to songwriters, composers, lyricists, and publishers. The MLC does not replace sound-recording-owner or featured-artist collection routes. The MLC FAQ: Mechanical Licensing Collective explains that distinction.

Public-performance royalties for compositions may involve performing-rights organizations, publishers, administrators, or direct licenses, depending on the use. The right organization depends on the copyright and the use—not simply on whether the word “streaming” appears in a report.

Who can receive the statutory allocation

Section 114 statutory receipts are allocated among several categories. The statutory allocation is 50% to sound-recording copyright owners, 45% to featured artists, 2.5% to nonfeatured musicians, and 2.5% to nonfeatured vocalists, subject to statutory provisions and permitted deductions. Chapter 1—Circular 92: Section 114, Scope of Exclusive Rights in Sound Recordings provides the statutory percentages.

These percentages describe the allocation of statutory receipts. They are not a promise that an individual performer will receive a particular amount, and they are not necessarily the same as net contractual income after ownership arrangements, representation, collective costs, or other deductions. A featured artist may have a direct claim as a performer. A label or other sound-recording copyright owner may have a separate claim as the owner of the master. If one person occupies both roles, the collection profile can include both categories.

Nonfeatured musicians and vocalists may have a statutory share as well. Producers, mixers, and engineers may be able to receive Section 114 royalties through a Letter of Direction mechanism rather than automatically registering as featured artists or sound-recording copyright owners. The applicable agreement and a valid Letter of Direction matter. Allocations for Music Producers confirms that this mechanism can allow producers, mixers, and engineers to receive Section 114 royalties.

A practical registration route

Registration is free. SoundExchange’s registration process and SoundExchange Direct tools allow registered creators to search for and claim recordings, manage catalog information, and review payment details. Register with SoundExchange describes those functions.

A practical route looks like this:

1. Identify your role. Decide whether you are registering as a featured artist, a sound-recording copyright owner, or both. If you are a producer, mixer, or engineer, investigate whether a Letter of Direction is the appropriate route for the relevant recordings.

2. Gather ownership information. Confirm who owns or controls each sound recording. Ownership can differ from the person who performed on the track. If a label owns the master, the artist’s performer registration does not automatically make the artist the sound-recording copyright owner.

3. Assemble recording metadata. Search for your recordings and claim the correct versions. Metadata such as International Standard Recording Codes, commonly called ISRCs, can help distinguish recordings and match usage reports. Check titles, featured-artist information, versions, and ownership details carefully.

4. Complete account information. Maintain accurate contact, payment, and tax information. A registration that is incomplete, tied to the wrong role, or missing required payment information can delay collection even when a recording has been used.

5. Review and maintain the catalog. Add new releases, correct mismatches, and monitor the account. Registration is not a one-time substitute for catalog administration. Recordings may appear under alternate titles, versions, or metadata supplied by a service.

6. Understand the reporting and payment conditions. A successful registration does not promise immediate money. Royalties must be reported, matched to the right recording and recipient, and processed under the applicable payment program.

The goal is not to claim every recording indiscriminately. The goal is to create an accurate rights record so that eligible uses can be matched to the correct people and entities.

How payment timing works

SoundExchange states current operational thresholds for payments. As of August 7, 2026, electronic accounts may receive monthly payments at $100 or more, quarterly electronic payments at $10 or more, and quarterly checks at $100 or more. I registered, but I haven’t received any money yet? lists those thresholds.

These are operational thresholds, not a typical first-payment timetable. The evidence packet does not support promising that a new registrant will receive a first payment within six to nine months. Payment also depends on a complete account, accurate claims, reported uses, successful matching, and the absence of holds or other processing issues. Thresholds can change, so check SoundExchange’s current payment information when relying on them.

If you registered and have not received money, that alone does not prove that registration failed. Check whether the service use was eligible, whether the recording was reported, whether the claim identifies the correct recording, whether ownership is documented, and whether your balance and payment method meet the current program requirements.

A simple rights-and-royalty map

For a recording used by a digital service, ask these questions in order:

• Is the use audio, video, download, podcast, terrestrial radio, or digital transmission?
• If it is a digital audio transmission, is the service noninteractive or interactive?
• Does the use fit an eligible Section 114 service category and satisfy its compliance conditions?
• Which party is the featured artist?
• Which party owns the sound recording copyright?
• Who owns or administers the musical work?
• Which collection route applies to each right?

For example, imagine that you are the featured artist on a recording but a label owns the master. If an eligible noninteractive digital service uses the recording, the performer and the sound-recording owner belong to different recipient categories. Your featured-artist claim and the label’s owner claim are not interchangeable. The statutory allocation assigns 45% of receipts to featured artists and 50% to sound-recording copyright owners, with the remaining statutory shares allocated to nonfeatured musicians and vocalists. The composition’s songwriter and publisher royalties are a separate question and do not become SoundExchange royalties merely because the same recording was transmitted.

Now change the example to an interactive on-demand stream. That use is outside the ordinary Section 114 statutory license. Sound-recording compensation may instead arise through a negotiated license, while the musical work may generate mechanical and other composition royalties through separate systems. The correct next step is therefore not to assume that a SoundExchange claim covers the stream, but to identify the relevant sound-recording and composition agreements and collection routes.

U.S. scope and international limits

This article describes the United States federal statutory-license framework. International collections may depend on reciprocal agreements and territory-specific rules. The fact that SoundExchange does not collect a particular U.S. royalty does not establish what happens in another country, and a foreign neighboring-rights organization may operate under different rules.

The same caution applies to negotiated direct licenses. A service can have an arrangement that operates separately from the statutory pathway. The presence or absence of a SoundExchange claim does not, by itself, answer every contractual or international royalty question.

Your next steps

Start by listing your recordings and separating your roles: featured artist, sound-recording copyright owner, songwriter, publisher, producer, mixer, or engineer. Then identify which uses are eligible noninteractive digital audio transmissions and which are interactive, downloaded, terrestrial-radio, podcast, or video uses.

Register free with SoundExchange if you may be a featured artist or sound-recording copyright owner. Search for and claim the correct recordings, using reliable metadata such as ISRCs. Keep ownership, payment, and tax information current. If you are a producer, mixer, or engineer, check whether a Letter of Direction is appropriate for your agreements. Separately review your musical-work collection route, including The MLC for eligible U.S. blanket mechanical royalties connected to interactive streaming and downloads.

The central lesson is simple: SoundExchange is one collection route for one side of a larger rights system. Accurate registration can help eligible noninteractive digital performances reach the right recipients, but it cannot replace songwriter, publisher, negotiated sound-recording, terrestrial-radio, download, podcast, video, or international collection systems.

Open Music Business provides educational information, not individualized legal, financial, tax, contract, or royalty advice. Rules, operational thresholds, service arrangements, and payment practices can change. For a specific recording or agreement, consult the relevant rights organization and a qualified professional.