How Performance Royalties Are Calculated

Published: Tue, 12/28/10

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Today let's take a look at how performance royalties are calculated when your music is broadcast in television. The following is the formula ASCAP uses to determine how much to pay artists for a single broadcast. BMI and Sesac use very similiar formulas.

Generally, royalties for a single musical work, in any surveyed medium, are the product of this calculation:

Use Weight	X	Licensee Weight	X	"Follow the Dollar" Factor	X	Time of Day Weight	X	General Licensing Allocation
+
Radio Feature Premium Credits (for radio performances only where applicable)
+
TV Premium Credits (for performances in highly rated series, where applicable)
=
Credits

USE WEIGHT

The factor, or value, attached to each type of performance, such as theme, underscoring, promotional.

LICENSEE WEIGHT

This factor reflects the license fee paid by a station (or group of stations) and the number of hours included in the appropriate survey. The licensee weight is also referred to as the "hook-up" weight with respect to network television, reflecting the number of stations carrying a broadcast. Other surveyed media - such as TOP 200, live concerts tours, symphonic and chamber concerts, web sites, background music services, airlines, circuses, and ice shows - are also assigned 'weights' based on license fees paid to ASCAP.

"FOLLOW THE DOLLAR" FACTOR

This factor ensures that the license fees that ASCAP receives from any medium are paid to writers and publishers for performances on that medium. In other words, the money received from radio is paid out for radio performances, etc

TIME OF DAY WEIGHT (if applicable)

On television, the value of a performance can vary depending on the time of day; for example, whether it takes place in prime time or in the middle of the night.

GENERAL LICENSING ALLOCATION

Fees collected from non-broadcast, non-surveyed licensees (bars, hotels, restaurants and the like) are applied to broadcast feature performances on radio and all performances on television, which serve as a proxy for distribution purposes.

RADIO FEATURE PREMIUM CREDITS (for radio performances only, where applicable)

Songs that earn certain threshold numbers of radio feature credits in a quarter receive additional credits in that quarter.

TV PREMIUM CREDITS for TV performances only, where applicable)

Theme, underscore and feature performances in highly rated network and local TV series earn additional credits as TV Premium payments.

CREDITS

CREDITS X SHARE X CREDIT VALUE = $ ROYALTY

When all of these factors are computed, we arrive at the number of total performance CREDITS. After establishing the number of credits generated by a performance, the next step is to allocate these credits among all of the writers and publishers of the work based on the SHARE each should receive. ASCAP is advised of the correct shares to be paid when members submit Title Registrations. For example, if two co-writers of a song share royalties equally, each will receive 50% of the total credits. The final step is to multiply credits by the appropriate CREDIT VALUE to arrive at the ROYALTY payment.

Happy Songwriting!
Aaron Davison