A mechanical in music business terminology is a right, license and royalty that comes from distributing physical or digital copies of a song.
When you make a recording of a song and distribute it to the public, you are using the exclusive mechanical right that belongs to the songwriter and music publisher protecting the song.
If you are going to make a recording of a song that you did not write, you need to get permission in writing, which is called a mechanical license.
This mechanical license gives you permission to record the song, and to sell, stream and distribute to the public copies of that song embodied in your recording.
A typical mechanical license gives the recording artist permission to record and distribute a certain number of copies (usually 1000 or more) and then to account quarterly to the publisher / songwriter and pay for any additional copies manufactured.
For digital sales, downloads generate the same amount of royalty income as physical units, currently $0.12 per unit (for a single or one song on an album). This rate just went into effect in 2023, up from $0.091 where it has been holding since ’06.
The royalty amount for digital streaming is far less, and is paid through a new blanket licensing system created by the Music Modernization Act, effective in 2021.
Now, all the mechanical royalty generated by online streaming companies called DSPs (digital service providers) goes to the MLC (The Mechanical Licensing Collective) and flows from there to individual songwriters, music publishers and administrators for distribution.
History –
The word “mechanical” comes from the old days of the music business, when all music was purchased in a physical format.
The mechanical, physical process the music had to go through to become a music product is the origin of the term we still use today.
A mechanical refers to the mechanical recording and pressing process that is seen in the movie “O Brother Where Art Thou.” Recording artists “sang into the can” or microphone, and the music, rendered as electrical signals, flowed through the wire to the machine that cuts grooves corresponding to the electromagnetic vibrations into a listenable format, such as vinyl records.
For a short time in recent history, it began to look like physical formats were being retired for good.
But with the growing discontent of music consumers and music creators rights advocates, there is more money being spent on vinyl records purchases every year, with many predicting a new physical format coming to consumers within the next few years offering more convenience in listening and higher fidelity sonic vibration.
Current mechanical royalty rates for U.S. based songwriters –
Mechanical royalties once made up about half of the income for songwriters.
When the album format was the only way of getting a recording of your favorite song you could count on a sustainable income as a songwriter.
This is because every time someone bought the album with your song on it, every songwriter with songs on the album got paid the same rate. Of course, the song that became the radio single would make far more money in other types of royalty, such as performance or synch if it was used in a movie or commercial advertisement, and it did a service to the other songs’ writers and publishers by being a driver of album sales.
That system went away with the advent of the singles market provided to consumers by Apple Music’s iTunes platform.
Artists like Garth Brooks, who is a famous hold out from most digital music platforms, provide good evidence that the album format is a big factor in an artist team’s economic sustainability long and short term, because the songwriter is the foundation of that system.
Chart of recent mechanical royalty rates for various platforms (from Q4 2022 Statements)–
Direct from independent artist rate – full statutory physical / download unit rate $0.12
Deezer $0.000950
Pandora $0.000115
Securus $0.000242
SoundCloud $0.000124
Spotify $0.000308
Trebel $0.000537
Amazon $0.000705
Apple $0.000454
YouTube Music $0.000151
iHeart Music $0.000463
Gtl $0.000117
The royalty rates here are from MLC payments and do not include performance royalties which are typically paid during a later period from ASCAP, BMI, or SESAC in the United States.
How to use “mechanical” in a sentence –
Mechanical means three different things and can be used correctly in various ways.
Correct usage #1 –
A recording artist needs to get a mechanical license from the songwriter / publisher for permission to record a song and distribute it to the public as a single download or album cut.
In example number one, the word mechanical is used to indicate which license is needed to make and distribute a recording of an original song.
This is especially true when the song has never been released. In the United States there is a thing called “first use” that says that anyone who uses the song the first time has to get specific permission from the songwriter / publisher. If they don’t get advance permission before they release the song, the songwriter and publisher can charge anything they want for the first use rights.
Once the song is released the first time, anyone can use what is called a compulsory license to record and distribute the song as long as they pay the statutory mechanical rates to the rights owners.
Correct usage #2 –
The MLC is the current designated company that processes the mechanicals from digital music service providers.
In example number two, the word “mechanicals” is used to mean the royalty money owed to songwriters / publishers whenever recordings of their original songs are performed digitally online.
This is a little bit confusing when you’re just learning, because digital music royalties are really a hybrid right – part of it is mechanical royalty (related to permission given to record / distribute the song in the first place) and the other part is performance royalty (related to the public performance of the song as it is embodied in the recording).
This matters because in other countries, the same organization collects and distributes all of the royalty money owed for mechanicals and performance royalty and pays it directly to their affiliate members.
In the United States, we have many different organizations collecting our royalty, and our two biggest performing rights organizations (in terms of how many members and compositions they have) are prevented by federal law from handling mechanical royalties. This has the effect of splitting the already nano-penny payments down even further as the types of rights are divided.
Correct usage # 3 –
There are several unique rights to copy employable by songwriters including print, public performance and mechanicals.
In this example number three, the word “mechanicals” is used to designate the exclusive right to make and distribute a sound recording of the original song.
The right to make and distribute recordings of a song is one of the most common areas of activity for music publishers dealing with record labels and independent recording artists.
Use of a songwriter / music publisher’s mechanical right is requested in writing by the record label, and the royalty payable is set by the U.S. government at 12 cents per unit for physical copies / digital downloads and the chart above shows some typical royalty rates for per unit (per song) digital streaming mechanicals (less than $0.001 per unit) which are paid directly from the DSPs to the MLC who then distributes it to songwriters and publishers.
Conclusion
In conclusion, a mechanical is a right, license and royalty for songwriters and music publishers that is employed any time an original song is recorded and distributed to the public.
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