I’ve already talked about how MUSICIANS are making money in 2021. Today though, we’re going to be looking at 6 ways to make money with your music online.
To be more specific, we’re talking about the actual music itself (the master recording, if you will).
It’s easier than ever to “supplement” your income as a musician online with blogging/vlogging, affiliate marketing, sponsorships, etc…), but what about releasing music?
I was determined to think of some ways to make money with your music online in 2021.
To my surprise, I actually started coming up with and finding some VERY promising ways to monetize your music on the internet.
Do you already know about these? Maybe.
However, I guarantee that you’ll find at least ONE idea in this article that you haven’t thought of before. I’ll also be teaching you HOW you can get started with all of the tactics we’ll be discussing today.
So, let’s start with the EASIEST way to monetize your music…
- 1. Music Streaming
- 2. Music Royalties
- 3. Music Licensing
- 4. Non-Fungible Tokens (NFTs)
- 5. Vinyl Records and Pressings
- 6. Monthly Subscriptions
- Summary: 6 Ways To Make Money With Your Music
1. Music Streaming
How much do music streaming services pay artists/musicians?
It ranges from $0.00069 (YouTube) to $0.019 per stream (Napster).
How do you get your music on Spotify, Apple Music, etc…?
Nowadays, it’s easier than ever to get your music on music streaming services. You’ll simply need to register with one of the many music distribution services (DistroKid, LANDR, etc…).
How much does music distribution cost?
You’ll be surprised to find out that some music distribution services are actually FREE. However, those music distributors usually take a percentage of your earnings in exchange.
You can also find affordable music distributors that charge as little as $19.99 per year (DistroKid) or some that charge you per release (TuneCore).
You’ve probably heard it before… Music distribution is essentially FREE.
Now, I don’t necessarily think that that’s a good thing. Basically, you’re also granting a FREE mechanical license to music distribution services when you decide to use them.
That’s what allows them to reproduce (make copies of) your music. Each stream counts as one “copy”.
However, the trade-off is that each time your music is streamed, you earn LESS THAN A PENNY!
You’d probably make more money BUSKING!! It’s definitely possible to earn your living from music streaming, but you’ll need LOTS of listeners.
|Music Streaming Service||$ Per Stream|
So, that’s why I avoid putting too much music on music streaming services.
I’d rather stream my music for free (which I do HERE) than increase the value of a platform that devalues my work.
Even if you collect an email address in exchange for access to your music catalog, it’s much better FOR YOU.
That’s just my personal opinion though! Maybe you can prove me wrong?
Here are some of the music distribution services I personally recommend…
- DistroKid (what I’ve been using for 2+ years)
Here are some relevant articles I’ve written on the subject of music distribution…
- How To Distribute Your Music for FREE
- LANDR vs DistroKid Music Distribution
- Ditto vs DistroKid Music Distribution
2. Music Royalties
How are music royalties calculated?
Each channel of distribution (radio, TV, etc..) calculates royalties differently.
For example, royalties collected from TV placements are determined by several factors. One of those being the Nielsen Broadcast Data System which determines rates based on when viewer engagement is highest/lowest.
That’s why songwriters/publishers get paid more during the Super Bowl.
The type of cue (background instrumental, features, etc…) also affects the rate.
It’s much more predictable on other distribution channels (like radio) because the rates are usually negotiated beforehand.
We call this the “blanket license” which allows the platform to distribute your music.
How do I collect royalties from neighboring rights (digital royalties)?
In the US (and the rest of the world), SoundExchange is the best alternative to a “traditional” neighboring rights collection society. Similar to PROs, each country may (or may not) have their own.
For example, in Canada we have Re:Sound.
Essentially, neighboring rights royalties are collected from…
– Internet Radio
– Satellite Radio
– Cable TV Music Channels
– Businesses (Hotel, Restaurant, etc…)
The list is still growing, so digital royalties are definitely the way of the future!
How do I collect mechanical royalties?
Once again, it all depends if your country has its own mechanical rights society.
However, there’s a MUCH better alternative which actually allows you to manage both your performance AND mechanical royalties in one place!
It’s called Songtrust and it also collects foreign performance/mechanical royalties.
Mechanical royalties (reproduction rights) are collected when your music is “copied” either physically or digitally (CD, digital stream, etc…).
They’re mostly paid out by music distributors, but you’ll definitely want to register with a mechanical rights collection society to collect royalties you might be missing out on.
You’ll collect royalties from your music when…
- Your musical work is performed (even if it’s a recording) in public
- Your master recording is broadcasted on radio, television, film, etc…
- Your master recording is reproduced physically and/or digitally
So, the first thing we need to learn is how to COLLECT these royalties. It can actually seem quite complicated at first because we’ll be dealing with performance AND mechanical royalties.
We’ll also be dealing with royalties that come from neighboring rights (also known as “digital royalties”).
Traditionally, you’d need to register your music with THREE different societies to collect everything…
- Performance Rights Organization (PRO)
- Mechanical Rights Collection Society
- Neighboring Rights Collection Society
Nowadays, you can simply register your music with TWO services called Songtrust and SoundExchange.
Songtrust takes care of performance/mechanical royalties (even foreign) while SoundExchange is an excellent alternative to neighboring rights collection society (it’s essentially the same).
Now, the difficult part is actually getting your music “placed”.
Before you start earning royalties with your music, you’ll need to have some of it in the system.
Technically, music streaming generates mechanical royalties (although these are collected by music distribution services). However, we’re looking for royalties that can PAY YOUR BILLS!
For example, artists/musicians can earn up to $50 per play on satellite radio stations like SiriusXM.
The only thing is it’s pretty difficult to get your music up there…
It’d be easier to get your music placed in a Super Bowl commercial and that’d still generate LOTS of royalties.
It’s difficult to say how much you’ll earn from music royalties because there are SO MANY channels of distribution and each one has its own way of calculating rates.
That being said, I simply encourage you to look BEYOND music streaming services.
Here are some organizations you should check out in regards to collecting music royalties…
Here are some relevant articles I’ve written on the subject of collecting royalties…
3. Music Licensing
How much does it cost to use licensed music?
I’ve seen songwriters/composers selling licenses to their music for as low as $7 on Pond5.
However, some music licenses can be sold for THOUSANDS of dollars. It just depends on the intended usage and/or the budget of the project.
It’s also become quite common to sell music licenses through monthly subscriptions (for example, it will cost you $199 if you’re using Artlist).
What are the different types of music licenses?
There are essentially 6 types of music licenses…
– Synchronization License
– Mechanical License
– Master License
– Public Performance License
– Print License
– Theater License
The most common type of license issued by music copyright holders is a sync license. However, the owner of the musical copyright can issue many different licenses for a variety of different functions.
For example, a print license can be issued to print sheet music.
The idea of collecting royalties from master recordings and musical works isn’t new.
It’s the idea of selling licenses to your music (as an independent artist/musician) that’s new.
In the past, it was record labels who usually held the rights to the master recording and sometimes even the musical work itself.
Let’s just say that artists weren’t always in control of the situation…
It’s similar nowadays with the rise in popularity of music licensing platforms.
In some instances, you may be giving up 100% of those licensing fees (along with your exclusive rights).
In other words, you’re potentially giving up a HUGE portion of your income.
Depending on the usage, a music license can be sold for as little as $7 and as high as 4-5 figures!
So, why are artists and musicians only starting to wake up now?
I personally think it’s because the ability to independently produce an entire track from start to finish has only become possible in recent years (i.e the rise of the bedroom producer).
That being said, it’s become possible for an artist to own his/her musical work AND master recording.
That’s why I’d consider selling licenses to my own music as often as possible.
You can also find marketplaces that facilitate this process (although they may take a percentage of your earnings).
Here are some royalty-free platforms you can use to license your music…
Here are some relevant articles I’ve written on the subject of music licensing…
- Music Copyright Guidelines for Sync Licensing
- How To Sell Music on Pond5
- Best Music Licensing Companies for Independent Artists
4. Non-Fungible Tokens (NFTs)
How do you release music as NFTs?
It’s pretty easy to create your first music NFT…
After that, the sky’s the limit!
You can start releasing and purchasing NFTs while managing transactions with your MetaMask wallet. You can easily transfer Ethereum (ETH) from/to your wallet using exchanges like Coinbase, Binance, etc…
Can someone copy your music NFTs?
When it comes to purchasing NFTs, what you’re acquiring is actual ownership (or shares).
It’s not the same as purchasing a digital download; NFTs are digital assets.
That being said, it’s almost identical to purchasing a painting. You’ve most likely seen copies of the Mona Lisa being sold, but only one individual/entity can own the original.
That’s why NFTs are so powerful!
What is the most expensive NFT ever sold?
The most expensive NFT ever sold was sold for 69.3 million dollars.
It’s called EVERYDAYS: THE FIRST 5000 DAYS.
What rights does an NFT owner have?
It really depends on the agreement.
Generally, purchasing an NFT won’t transfer any rights to the actual intellectual property. It’s like when you purchase a painting; you’re just purchasing the artwork.
However, it’s definitely possible to customize your NFT’s smart contract.
We’ve already talked about how music streaming services and music licensing platforms capitalize on turning your work of art into a COMMODITY.
In other words, you give them permission to make UNLIMITED copies of your music.
That’s why NFTs are revolutionizing the digital music industry by creating RARITY.
Think about it, why are paintings sold for such high prices? It’s because a painting is one-of-a-kind!
Well, NFTs allow you to do the same with your music…
You’re essentially selling “shares” to your music in the form of tokens. It can be sold to one individual or to many and what’s interesting is that the original creator can earn royalties each time the NFT is resold.
I personally like where music NFTs are going and definitely recommend buying in!
Here are some NFT marketplaces created specifically for music…
5. Vinyl Records and Pressings
Staying on the topic of RARITY, I’m also going to recommend getting back into vinyl records and pressings.
To be more specific, I’m talking about producing a LIMITED QUANTITY.
It’ll work even better if you DON’T stream your music online. In other words, THE ONLY WAY to hear your music is on that vinyl record.
That’s how you can drive up your price!
You can even sell the master(s) (the metal stamper used to press your album/single).
So, how do you get started?
- You’ll need to have an album/EP
- You’ll ideally want to design some artwork
- You’ll need to put in your order (RECOMMENDATIONS BELOW)
- You’ll need an online store (ideally your own website) to sell them
How much money you’ll make from pressing your music on vinyl will depend on the amount of loyal fans you’ve managed to gather.
Make sure you have at least 100 people willing to spend $50+ on one of your “limited edition” vinyl records.
Here are some websites you can use to get your music pressed onto vinyl…
6. Monthly Subscriptions
You’ve most likely heard of platforms like Patreon, right?
Well, it’s essentially using a business model that is described as subscription-based.
In other words, any platform that bills its users monthly in exchange for access to exclusive content is following the same model.
Actually, even music streaming services use this model…
So, what I’m encouraging you to do once again is to create RARITY and EXCLUSIVITY by making your own platform (or using a “turn-key” solution like Patreon).
If you only make music, then you can charge a monthly fee to have access to your music. It can take the form of an online radio station or a music streaming platform.
You’ll be releasing new music each month to keep your users engaged!
Similarly, you can also charge a monthly fee to have the right to use your music commercially.
This would essentially become your own music licensing platform.
The only thing you need to keep in mind is that it’ll take a while before you see results. If you haven’t already established yourself and your following/traffic, you might want to consider working on that first.
Besides recurring revenue, subscription-based platforms can be an excellent way to earn passive income and to streamline your product/service (in this case, music).
Here are some platforms you can consider to host exclusive content for your subscribers…
Summary: 6 Ways To Make Money With Your Music Online
If you take anything from this article, it’s that the over-abundance of music is what’s reducing its value. Music streaming services need more subscribers, not more music.
Even music licensing platforms need to “liquidate” music to get it placed.
That’s why I personally believe that EXCLUSIVITY and RARITY are going to make a big comeback.
If you keep your music in the system, then it’ll eventually get drowned out.
Creating a loyal fanbase and network of clients is the most sustainable path for your music career.
NFTs are proof that artists are thinking of alternatives ways to make money with music.
Subscriptions are also an interesting way to take back control of your music and to make it exclusive to your supporters.
Of course, you’ll simply need to accept that the results won’t be instantaneous.
You’ll also mostly be doing EVERYTHING on your own.
However, the only real way to make money with your music is to do as much of the work yourself as possible. The more you sign-off, the less you make.
So, I hope that you found this article insightful! Let me know what you thought and feel free to ask me any questions in the comments. Thanks for reading, until next time!