The different types of music licenses: a complete overview

If you're a DIY artist or independent musician, just writing a great song isn't enough — you also have to know how to go about licensing it. Music licensing protects you and makes sure you get paid when your work is used commercially. It also gives you control over how it's shared.

In this detailed guide, we'll cover the different types of licenses and explain what they mean for you as an independent artist.

Licensing isn't just bureaucratic busywork, although it can feel that way if you're unfamiliar with the process. For that reason, we've created this guide to help walk you through the process as well as help you get started with related services that can truly take your work to the next level.

Think of licensing as a way to:

1. Protect your work from unauthorized use
2. Earn every dollar you deserve
3. Maintain complete creative control (you decide when, where, and how your music is used)
4. Build professional credibility with studios, supervisors, and venues

Too often, indie artists share clips without owning rights, only to get blocked or owe back royalties. Think of licensing as your roadmap. Here's how to turn legal tangles into brilliant opportunities.

Who owns what with copyright?

Music copyright comes in two flavors:

1. Composition copyright ("PA") which is made up of the lyrics and melody
2. Sound recording copyright ("SR") which is the actual audio capture

Once you create and record your song, you automatically own both. Registering with the U.S. Copyright Office gives you full legal protection, so it's a good idea to do that officially. By registering, you are eligible for statutory damages which can add up to anywhere from $30k-$150k per infringement. You also get a public record that makes it clear who owns the intellectual property (IP). Plus, copyright registration is required if you ever take legal action.

At Disc Makers, we strongly recommend that you file for both SR and PA copyrights if you're writing and recording.

Now that you understand the basics of how copyright works, let's move onto the different types of music licenses themselves.

Mechanical licenses

You'll need a mechanical license if you record a cover of someone else's song or if you distribute your own musical composition as a physical CD, download, or ringtone. In the U.S., mechanical licenses are compulsory — that means that anyone can cover your song as long as they pay the statutory rate.

At Disc Makers, we've partnered with Easy Song Licensing - a one-stop platform that makes it easy to file and pay for mechanical clearance.

1. First, you'll file the NOI (notice of intent) before release
2. Next, you calculate royalties (number of copies x rate)
3. Finally, you secure a license for each format (CD, digital, ringtone, vinyl)

Full details and templates can be found on our copyrights and licensing page.

Master use license

You'll need a master use license for every time you sample another artist's audio. Yes, even a five-second snippet. That's because the master recording is separate from the composition itself. Even if you want to use someone else's recording briefly, you'll need to have this license.

Should you choose to have Disc Makers manufacture your vinyl records and/or CDs, you'll need to submit proof of the master-use license regardless of how long the sample length is. You'll also need to complete the intellectual property rights (IPR) form.

Synchronization (sync) license

A synchronization (sync) license gives someone permission to use your composition in digital media — like syncing a lyric to a video. This is separate from the master-use license (which deals with the recording itself). If the user wants to use your recorded version as well, they'll need both types of licenses.

Sync licenses are an excellent way to boost your exposure and your earning potential because they pave the way for greater royalties and exposure. For example, you might earn a few hundred dollars if your melody or lyrics appear in an indie or short film, or up to $50,000 or more if you get a placement in TV ads.

Sync placements can also open industry doors and add credibility to your name as an artist. You can also earn performance royalties via your PRO (more on PROs below). Unlike with other licenses, there's no statutory rate for sync license fees. The project budget and market value are generally taken into account when negotiating, so for instance, a DIY or student short would pay less than a major film.

Performance license

Performance licenses grant the rights to perform your composition (and sometimes your recording) in public. Any time your song is:

• Performed live, either via concerts or open mics
• Aired on radio or TV
• Streamed on services like Pandora or Spotify
• Used in a podcast or streamed video with sync

It needs to have a performance license. In the U.S. these are issued as "blanket licenses," which paves the way to accessing entire catalogs via PROs.

What are PROs?

PROs are performance rights organizations. You'll join one once your songwriting is registered (the "PA" copyright). There are three different groups:

1. ASCAP
2. BMI
3. SESAC

Depending on the group you join, they'll collect performance royalties whenever your song is performed via the aforementioned channels. Keep in mind that you can only join one PRO at a time, but no matter which one you choose, make sure it lines up with your PA copyright filing.

It's worth noting that ASCAP and BMI are free to join and have bigger catalogs while SESAC is a boutique organization only available by invitation, but it offers more personalized service. Learn more with our detailed breakdown of each on the Disc Makers blog.

Blanket licenses

Blanket licenses are one of the most important, but also most misunderstood tools in the music licensing world, particularly if you're dealing with public performance. In short, a blanket license lets a venue, broadcaster, or service provider play any song from a specific catalog as many times as they want for a set fee. It covers a variety of songs under a single agreement, which frees up a great deal of time and effort from trying to get a single license for every single track.

Blanket licenses are typically issued by PROs. For example, if a coffee shop buys a blanket license from ASCAP, they can play anything in ASCAP's catalog, from Billie Holiday to Billie Eilish, without needing to get permission. Blanket licenses are typically used by organizations who either play music in public or for the public, such as:

• Radio stations (online and traditional)
• TV networks
• Streaming services
• Clubs, bars, and restaurants
• Gyms, stores, and salons (as background music)
• Theatres and performing arts centers
• Digital streaming platforms like Spotify (only for composition, not recordings)

Basically, blanket licenses exist because trying to track and negotiate royalties for every single individual use of a song or album would be overwhelming. So, PROs collect annual fees from venues based on things like square footage, capacity, and how frequently the music is played. They then track performances and handle paying the songwriters and publishers respectively. The more your song is played, the more you earn.

However, keep in mind that if you're not registered with a PRO, your metadata is wrong, or the venue isn't licensed, you'll lose out on those earnings. It's also important to note that blanket licenses don't cover master recordings, sync use (like if your music is synced to visuals like a YouTube video or ads), or dramatic performances. For things like musicals or theatre, you'll need grand rights.

We highly recommend registering your compositions and submitting set lists after gigs by using tools like ASCAP OnStage or BMI Live so you can get paid for live performances, even at your local bar or café.

Grand rights

Grand rights apply whenever your composition is performed in musical theatre, operas, or staged shows. These rights are always negotiated directly with rights holders. For instance, your rock ballad is used in a community's theatre production — that's where grand rights would come into play since it involves a performance in a drama context.

Print rights

Print rights are used whenever lyrics, chords, or full sheet music are published. Publishers and songwriters usually earn anywhere from 20-30% from sales. As an indie artist, you can also self-publish by uploading PDFs, selling lyric books at shows, and controlling the pricing and splits on your own.

Digital rights and webcasting

There are two options for digital licensing: interactive streaming and non-interactive streaming. Interactive streaming includes platforms like Spotify and Apple Music. Composition requires a mechanical license and gives you performance royalties. Recording the work is covered under master-use when it is sold. PROs collect your streaming performance royalties and mechanicals are paid via Easy Song or Harry Fox.

Non-interactive streaming, like Pandora, handles no skip, fixed playlists. SoundExchange collects for sound recordings and PROs will collect for composition.

YouTube is a mixed bag; they look at your song and your recording separately. Compulsory mechanical doesn't apply, but sync is required, even for user-generated content. You'll still need the master use license even if it's your own recording. PRO and SoundExchange royalties still apply thanks to YouTube's licensing deals.

Essentially, to cover YouTube, you'd:

1. Join SoundExchange (which allows you to generate passive income from non-interactive platforms)
2. Confirm that your PRO can collect your digital performance royalties
3. File mechanical notices (NOI) if you're doing interactive streaming or offering digital downloads
4. Give YouTube publishing and master data so that their content ID system works correctly.

Production music/library licensing

Production/library music is music that's pre-cleared for use in syncs and masters. One licensing fee lets buyers use it across multiple platforms or projects. This type of license is ideal for indie composers who want their music to be used in TV shows, ads, YouTube, or films.

The best part is, you can get it done in as little as three steps:

1. Submit 3—5 polished tracks to libraries
2. The fee covers both the composition and master, so there are no extra licensing headaches to deal with
3. Libraries then pitch tracks to supervisors, which can generate passive income for you if they use it in their syncs.

The libraries also handle negotiations with regard to the master use and sync.

Creative commons and royalty-free licenses

Creative commons and royalty-free licensing are more flexible types of licenses for your creations. Creative commons (CC) licenses let creators publicly share their work with greater control. Rather than "all rights reserved," as in the case of traditional copyright, CC offers "some rights reserved," which means the public can reuse, remix, or redistribute your work under the conditions you choose.

You still keep the copyright — you just grant them pre-defined permissions. There are six types of creative commons licenses each built from four core pillars. The four pillars are:

1. BY - Attribution (must give credit)
2. NC - Non-commercial (cannot make money with it)
3. ND - No derivatives (can use it without changing it)
4. SA - Share alike (all derivatives must use the same license)

Now let's look at the six types of licenses:

• CC BY - Attribution - Meaning others can use your music for any purpose. They can remix it, modify it, and build on it, as well as use it commercially. They must give you credit in the way you specify. This is the most permission of the CC licenses and is ideal if you want to generate exposure or you want your work to be used on YouTube.
• CC BY-SA - Attribution-ShareAlike - Others can remix, change, or build upon your music and use it for commercial purposes. They can also redistribute it, but only under the same license. They must give you credit and share new work under the same license. This is the most common type used by Wikipedia and open-source projects. If you're an indie musician who wants to embrace remix culture but also keep derivatives open as well, this is your CC license.
• CC BY-ND - Attribution-NoDerivs - Others can redistribute your song without changes and can use it commercially. They must provide attribution and cannot remix, change or otherwise edit it. This type is typically used by composers who release cinematic or instrumental tracks but want them used exactly as-is.
• CC BY-NC - Attribution-NonCommercial - Others can remix and reuse your song. They can also use it in student films and podcasts. Nonprofits can use it as well, but they must attribute you. It cannot be used for commercial purposes. This one gets used a lot, but it's not clearly defined what's considered as "commercial use". For instance, would a monetized YouTube video be considered commercial? It's a grey area.
• CC BY-NC-SA - Attribution-NonCommercial-ShareAlike - Others can remix and redistribute your work under the same license but they cannot do so commercially. Any remixes have to be licensed in the same way. This is a community-builder license. Others can use your stuff as long as they abide by your requirements.
• CC BY-NC-ND - Attribution-NonCommercial-NoDerivs - Others can share your music, but only in its original form, and they can't make money with it. They must also attribute you, and they cannot remix your work. This is the most restrictive of the CC licenses.

It's important to note that creative commons licenses are non-revokable. Once you release something under CC, you can't change it later. You also can't release something under creative commons that you don't fully own (like beats sampled from others). Be clear in your metadata and links by always being specific about the CC version and license terms. Also, CC does not mean royalty free. Even with a CC license you may still get performance royalties from PROs, depending on how it's used.

Fair use exemptions

Fair use permits limited use without license for criticism, news, and education. There are no guarantees, and it's often disputed, which means claiming fair use is something that's looked at on a case-by-case basis. It's not a reliable way to license your work for commercial or promotional use.

How to work with licensing as an indie artist

Licensing sounds complicated and can feel intimidating, but with this helpful guide, you can see just how powerful it truly is. Start by registering your work with the U.S. Copyright office (both the composition and the sound recording) and register your songs with a PRO like ASCAP or BMI.

Once you have the basics nailed down, think about where you'd like your music to live. Do you want to play live shows? Submit your set lists to your PRO via platforms like ASCAP OnStage or BMI Live. Got an instrumental or cinematic song? Consider letting a music library store it for future licensing. Don't forget to set yourself up with SoundExchange to collect digital performance royalties for non-interactive streams.

It's entirely possible (and highly likely) that as you grow and your music generates more exposure and income, your licensing strategy will change and evolve over time. This is to be expected and it's something that many indie artists go through. The important thing to remember is to be proactive about protecting your rights so that you never miss a paycheck.

Beyond this in-depth guide, think of Disc Makers as your full-service partner. We do more than just press your CDs and vinyl records. We're a one-stop shop for artists who want to protect and monetize their music while handling licenses the smart way. From walking you through the process to register your copyright to getting mechanical licenses for cover songs through Easy Song Licensing, we're here to help you along the way.

Be sure to check out our blog where our experts will explain complex topics like sync licensing, performance royalties, and digital rights. By following along, you'll never be left to guess what comes next. Everything we do is designed to make the music licensing process as simple and straightforward as possible, so that the end result is much more artist-friendly (as it should be). Whether you need help with your IPR (Intellectual Property Rights) documentation, you need templates to follow, or you want to submit your music for licensing opportunities, we're ready to help point you in the right direction. Contact us to get started.

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