We get lots of music business questions in SongTown and this is a common one, so I thought I’d answer it in a post. The business side of music is not as complicated as it seems. Here are the basics of writer/publisher deals and how money is split.
There are two shares of royalties for each writer when a song is created. Each writer has a “writer’s share” and a “publisher’s” share. So, if there are two writers on a song, there are four shares assigned to that song. Two writer shares and two publisher shares. They way those shares are divided depends on the contracts that the writers have entered into.
In my case, I’m signed to an exclusive publishing agreement with one publisher. And my deal with them is a 50/50 co-pub. That means that for every song I write, I get my writer’s share and 1/2 of my publishing share. My publisher gets the other 1/2 publishing share. Many new writers get publishing deals that are called “straight publishing deals”. That just means that the publisher gets all of the publishing share. Clay and I both started out this way. That’s a common scenario and reduces the risk for the publisher.
Other writers sign single song deals. Those deals only affect one song at a time. That song is split based on the contract, but most single song deals are straight publishing deals as well, with the publisher getting all of the publishing share.
When a song gets recorded and money starts rolling in, the publisher gets to first recoup the money they have paid a writer for advances and demo costs (for all songs, not just the one that got recorded). Then, the money is split according to the contract. Writers without any sort of publishing arrangement own both their writer’s and publisher’s share by default.
The only exception to that rule is that, generally, most writers get their writer share directly from their PRO (ASCAP, BMI, SESAC, SOCAN, etc), even if they haven’t recouped with their publisher. That’s why radio singles are extra nice. You get paid even if you aren’t recouped.
That’s it in a nutshell. You now know the basics of writer/publisher splits.
Happy writing! Marty