If your song reaches 1 million streams on Apple Music, you might wonder how much revenue you will generate and how it will be distributed. Let’s break down the process assuming that you are both the artist/performer and the songwriter/composer of the song.
Initial Revenue Calculation
Apple Music typically pays around $0.0064 per stream. So, if your song gets 1 million streams, the initial revenue would be:
1.000 000 streams X $0.0064/stream = $6400
Music Distributor’s Share (What’s Music Distributor)
Music Distributors generally collect 75-80% of the revenue before taking their share. Assuming an average of 78%, about $5,000 would go to your distributor.
$6400 X 78% = $5000
The distributor typically takes a fee of 20-30%. Assuming an average of 25%, the label receives $3,750:
$5000 X 75% = $3,750
The label usually takes 50%, so the artist ends up with $1875:
$3750 X 50% = $1875
Remaining Revenue Music Distribution
After the distributor and label take their shares, $1400 remains:
$6400 – $5000 = $1400
This $1400 is split into Performance Royalties (What’s Performance Royalties) and Mechanical Royalties (What’s Mechanical Royalties).
The split varies by region and type of revenue (streams or downloads).
For digital streams in Europe:
- 75% is Performance Royalties:
$1400 X 75% = $1050
- 25% is Mechanical Royalties:
$1400 X 25% = $350
Performance Royalties Distribution (What’s Performance Royalties)
Performance Royalties are collected by Performing Rights Organizations (PROs) (What’s PRO).
In this case:
- 50% goes directly to songwriters/composers:
$1050 X 50% = $525
- 50% goes to the publisher:
$1050 X 50% = $525
The publisher will take a 30% fee from the $525, and the remaining 70%
$525 x 70% = $367,5
are paid directly from Publisher to songwriters/composers
Mechanical Royalties Distribution (What’s Mechanical Royalties)
Mechanical Royalties are collected by your publisher:
Total Mechanical Royalties = $350
Publishers usually take a 30% fee from the royalties they collect:
$350 X 30% = $105
The remaining 70% goes to the songwriter/composer:
$350 – $105 = $245
Summary of Earnings
Scenario 1: With a PRO membership and with a Publishing deal
You would receive the total amount:
- $1875 from the Label
- $525 from the PRO (Performance Royalties)
- $367,5 from the Publisher (Performance Royalties after the Publisher’s fee)
- $245 from the Publisher (Mechanical Royalties)
In total, you would get
$1875 + $525 + $367,5 + $245 = $3012,50
which is around 47% of the Initial Revenue
Scenario 2: With a PRO membership, without a Publishing deal
$1875 + $525 = $2400
which is around 37,5% of the Initial Revenue
Scenario 3: Without a PRO membership, with a Publishing deal
$1875 + $367,5 + $245 = $2487,5
which is around 37,5% of the Initial Revenue
Scenario 4: Without a PRO membership and without a Publishing deal
$1875
which is around 29,3% of the Initial Revenue
Understanding these details can help you better navigate the music industry and manage your expectations regarding streaming revenue.
Do I Need a Publishing Deal?
Considering the scenario with a PRO membership, you receive $3,012.50 with a publishing deal and $2,400 without one. This translates to a 25.5% increase in your overall revenue.
In reality, the benefit is even greater than this percentage suggests. With a publishing deal, your publisher ensures that your performance and mechanical royalties are properly collected. Without a publisher, you cannot be certain that the PROs will pay you correctly and consistently. Thus, having a publishing deal not only increases your revenue but also provides security and efficiency in royalty collection.
