The Importance of Music Licensing and Royalties

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By Nicole McCray

The music industry in the United States is growing at an unprecedented rate, and with it, a great number of artists, songwriters, and composers are flooding the music scene. As an artist, if you want to stand out from the crowd and make money while you are at it, you need to consider music licensing and royalties.

The music industry is governed by the rules of music licensing and royalties, without which things could get quite chaotic. For artists, ways of earning are many, but if they are well acquainted with how licensing and royalties work, they can make more considerable earnings. 

In this article, we dive into the brief understanding of both music licensing and royalties and their importance in the music world for new and established artists.

What is Music Licensing?

Music licensing is the process of obtaining permission to use a specific piece of music in a particular context. This can include the use of music in films, TV shows, video games, podcasts, commercials, and other forms of media, as well as the use of music in live performances or in public places.

If you have ever heard a popular song being played in a TV show, how that song ended up in that show is via music licensing. This does not just apply to TV shows but to movies, commercials, video games, and more. 

Through music licensing, the copyright holder of a song allows the public use of their work; in return, they receive a fixed amount or continued royalties as per their agreement. 

To put it in simpler terms, a music license provides authorization to use a song in a certain way for which the owner of the song/music gets paid, and it is applicable to all major streaming and media platforms. 

In today’s digital age, everyone has become quite aware of terms like avoiding a YouTube copyright claim, licensing music for podcasts and events, and getting royalties, but how are they important to the artists, let’s discuss that further.

Importance of Music Licensing for Rock Artists

Rock artists, like all other musicians, can benefit from obtaining appropriate music licenses for the use of their music in various media. Sync licenses, mechanical licenses, and performance licenses are all relevant for rock artists, just as they are for artists in other genres.

Music licensing comes with a lot of benefits for artists; for starters, it helps get them get more exposure. Additionally, through music licensing, it can be made sure that the rightful owner of the song gets all the credit.


As an artist, whether you are making music for the pure love of it or are doing it because you are seeking fame and money, there is no joy compared to when you find someone enjoying your work. In the earlier times, sharing music was a challenge; you had your local music store as the only place that provided new music, and that was it. 

However, recently, thanks to the internet, sharing music has become a lot easier. And with music licensing, you can get even more exposure. 

Getting featured in a movie or a TV show gets your music to be noticed by more people in a short amount of time. This definitely allows you more exposure while also getting paid for it.

Income source:

Music licensing allows your music to be a part of movies, TV shows, music videos, commercials, etc. If your work gets featured in a major movie, chances are you will earn a lot more than when your work is featured in an indie film. 

No matter how much you make, it is necessary to start somewhere, and music licensing gives you that platform. It opens up doors for artists to make more money for their work. 

Residual Income:

Music licensing agreements are signed for a particular period, and artists can still earn through residual payments even when that period is up. In addition, with music licensing, you have the rights to your work which means you can get paid every time someone uses your work. 

Royalties – What Are They?

While music licensing allows someone to gain permission from the copyright owner of a song to use it in a certain way, a royalty is a payment paid to the owner for the licensed use of their work. 

Often, royalties are collected by intermediaries on behalf of the rights holders from various parties that use their work, such as radio stations, streaming sites, broadcasters, and more. 

So, for example, each time a song is streamed or covered, the rights holder gets paid. 

On the surface, music royalties seem simple enough; however, when you take a deeper look at it, it’s much more complicated. 

Between the rights holders and the institution that pays royalties, many middlemen own partial ownership of copyright recordings, and so they, too, collect royalties. 

So how do royalties reach the artists? 

In most cases, artists get royalties every month, but the exact amount varies per their agreement with the distributor. 

Importance of Royalties for Rock Artists

Artists work hard to make music, and for their hard work, they should get paid. Music licensing and royalties are one of the many ways which allow artists to get paid for the use of their work. As the music industry gets bigger, more artists are making their presence felt. 

Technology has made it possible for these new artists to share their music and get paid. 

One of the most important roles royalty plays in an artist’s life is that they get a steady flow of income through it. So even when the artist is gone, their work can still generate income and benefit their family. 

Back in the day, the process of music royalties used to be a lot easier than today. Most work artists used to get paid for was through selling physical records and radio plays. However, everything has become digital today, including how music is created and consumed. 

All this has led to music royalty becoming a somewhat complex process. Even then, we can’t ignore the fact that it is of utmost importance to artists and creators as it provides a significant income source for them.

Making money as an artist in the digital era can be a bit difficult. The process of earning royalty and understanding music licensing is not an easy one, but it is worth getting into its intricacies as these are one of the best ways creators can get paid for their creative work. 

Securing the appropriate music licenses is also vital for artists to ensure that they are fairly compensated for the use of their music and that their rights are protected. 

Nicole McCray is a contributor for and may be reached at

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