Music Industry: What are Neighboring Rights & Royalties?

what our neighboring rights there are two main copyrights to be distinguished in the music industry the composition copyright addresses lyrics music and

melody the master sound recording copyright is associated with the actual recording of the song neighboring rights is a term that relates to the royalties

earned from the public performance of a sound recording the performing artists on the recording and the copyright holder of the master recording are entitled to receive royalties every time

it is broadcast on TV radio or any other live performance in essence neighboring royalties for performing artists and master owners are the same as the

performance royalties are for songwriters and publishers remember from our previous videos that us performance royalty organizations collect and distribute performance royalties for

songwriters and publishers but not for performing artists and master owners most often record labels in the United States neighboring rites are not

recognized u.s. broadcasters are exempt

recognized u.s. broadcasters are exempt from paying license fees for performers and labels when sound recordings are performed on terrestrial radio or TV as

a consequence the United States does not have a traditional collection Society for the collection and distribution of neighboring rights royalties the closest thing to neighbouring rights in the US

are the digital performance royalties collected by sound exchange for digital transmissions only so why doesn't the US have a society

that collects and distributes neighboring royalties the answer goes back to 1961 and the Rome convention for the protection of performers producers of phonograms and broadcasting

organizations only countries who are signatories to this convention recognize and pay neighboring rights and only performers who are permanent residents of one of these countries or if the

musical recording was made in one of the countries who signed the Rome convention are eligible to receive these royalties and you guessed it the u.s. was not one

of them there are various reasons why the US did not become an initial signatory to the Rome Convention treaty one suggested justification is that radio station lobbyists feared that

terrestrial radio stations would then have to pay additional license fees essentially doubling its current fees this additional expense would have resulted in a severe strain on their business

the u.s. is refusal to recognize

the u.s. is refusal to recognize neighboring rights has created a ripple effect that hurts artists where they can least afford to be heard today their

wallets for example you're a us-based performer who recorded your song in the US this song gets publicly performed in the UK one of the initial signatories of

the Rome convention where neighboring rights royalties are paid but you ain't getting it why because think about it in Reverse a uk-based performer records a song in the

UK and it gets played in the US you know like maybe the Beatles in the US doesn't pay neighboring royalties so the countries that do pay them figure why

should we pay your artists if you don't pay hours while the reciprocity issue is understandable it begs the question where's the money

remember this money is paid by the broadcaster's in the signatories countries via a blanket license fee in the same way the broadcaster's in the u.s. pay a blanket license be for public

u.s. pay a blanket license be for public performance rights of the compositions in the u.s. it's just that it's not distributed to the performers and labels from the US

therefore it's it's and after a while it goes into the void of black box royalties the only way around this right now is for us labels and performers to

record in a signatory country anyway neighboring rights remain untapped as revenue streams for many featured us musicians and master sound recording owners is your music played outside of

the US are you missing out on neighboring royalties let us know in the comments below after you click the subscribe button and notification Bell