What is SoundExchange? The royalties your distributor doesn’t collect
SoundExchange collects the money US satellite radio, internet radio and cable music channels pay for recordings, and pays it straight to artists and master owners. Your distributor doesn’t collect it and neither do ASCAP or BMI, so if you never registered, it may be waiting for you. Here is what it pays for, how it splits the money, and how to register for free from any country.
This guide is general information about a US system, based on SoundExchange’s own pages and its 2025 annual report (read on October 25, 2026). Rules and figures change, so check the details on soundexchange.com before you decide.
What SoundExchange is
SoundExchange is a non-profit organization based in Washington, D.C., founded in 2003. US law (sections 112 and 114 of the Copyright Act) lets certain digital services play any released recording without negotiating with each label, as long as they pay a rate set by the Copyright Royalty Board. SoundExchange is the only organization designated to collect that money and pay it out. Its board has 18 members: half represent master owners and half represent featured and non-featured artists.
It pays for the recording (the master), not for the song as a composition. That is the side most artists forget, because in most of the world it is handled by neighbouring rights societies, and in the US it only exists for digital radio-style plays. The two copyrights of a song are explained in how music royalties work.
Which services pay it
The services that pay SoundExchange are the non-interactive ones: the listener can’t choose exactly which song plays next. SoundExchange names SiriusXM, Pandora’s radio and iHeartRadio as examples, along with webcasters (internet radio) and the music channels of cable and satellite TV. In 2025 it collected USD 1,052 million and distributed USD 992 million, according to its unaudited annual report.
| Where the song plays | Does SoundExchange pay for the recording? |
|---|---|
| SiriusXM, internet radio, Pandora radio, cable TV music channels (US) | Yes |
| On-demand streaming (Spotify, Apple Music, YouTube and similar) | No: the recording is paid through your distributor or label |
| AM/FM radio in the US | No: US law doesn’t give recordings a performance right on broadcast radio |
| Radio, TV and venues in other countries | Not directly: local neighbouring rights societies collect it, and some exchange money with SoundExchange |
How the money is split
The split is written into the law (17 U.S.C. § 114(g)), so it doesn’t depend on your contract with a label:
| Share | Who gets it |
|---|---|
| 50% | The owner of the master (the label, or you if you own your recordings) |
| 45% | The featured artist or artists, paid directly |
| 2.5% + 2.5% | Non-featured musicians and vocalists, through two funds linked to the AFM and SAG-AFTRA unions |
Before splitting, SoundExchange deducts its costs. Its operating administrative rate was 6.3% in 2025 (5.2% in 2024), according to the same report. Nobody pays a fee to register.
Two practical consequences. If you are an independent artist who owns your masters, you can collect both shares: register as featured artist and as rights owner. And the 45% reaches the artist even if they are signed to a label and haven’t recouped, because SoundExchange pays it straight to them. Producers, mixers or engineers don’t get a share by law, but the artist can send them part of theirs with a letter of direction (LOD), which SoundExchange then pays directly — something to write down in the split sheet or the producer agreement.
SoundExchange vs ASCAP, BMI and the MLC
| Organization | Pays for | Pays |
|---|---|---|
| SoundExchange | The recording, on non-interactive digital radio in the US | Featured artists and master owners |
| ASCAP, BMI, SESAC, GMR | The composition, when it is performed in public (radio, TV, venues, streaming) | Songwriters and publishers |
| The MLC | The composition, as mechanical royalties from on-demand streaming and downloads in the US | Songwriters (self-published) and publishers |
| Your distributor or label | The recording, on stores and on-demand streaming | The artist, under the distribution or record deal |
They don’t replace each other (how The MLC works is in what is The MLC). An artist who writes their own songs and owns their masters can be paid by all four for the same song. A publishing administrator collects the composition side worldwide, but not SoundExchange — see what a music publishing deal is.
How to register
- Check if money is already waiting: SoundExchange has a public search of artists and rights owners with unclaimed royalties.
- Register online at register.soundexchange.com, as featured artist, as rights owner, or both. It is free, and artists from outside the US can register too.
- Fill in the tax form: outside the US, a W-8BEN. Without it, 30% is withheld; with a tax ID from a country with a tax treaty, the withholding may be lower.
- Add how you want to be paid: direct deposit (in local currency in some countries), paper check or, depending on your tax status, PayPal and other apps.
- Register your recordings in your catalog with their ISRC codes, so the plays reported by each service match your tracks.
- Decide about international collection: registering covers the US; becoming a member lets SoundExchange also claim your royalties from other countries, unless your local society already does it for you. Don’t give the same mandate to two organizations.
Do it when you release, not years later: the earlier you are registered, the less money sits waiting. The full release timeline is in the release planning checklist.
When and how it pays
- Direct deposit: monthly if you have at least USD 100 accrued, or quarterly from USD 10.
- Paper check: quarterly, from USD 100.
- Services usually pay SoundExchange 45 days after the end of the month of the plays, so the first payment comes some months after the first plays.
Labels that pay royalties to several artists need each statement to show what came from where. TONTRIA for Labels can prepare those statements by release, track and source.
Unclaimed royalties
When SoundExchange can’t find the artist or the owner, it keeps the money. Its FAQ says royalties are collected going back up to 3 years, and its annual report says it holds undistributed statutory royalties for at least three years from the first distribution; after that it may use them to offset its costs. So an old song that played on satellite or internet radio can still have money waiting, but not forever. SoundExchange publishes lists of unregistered artists, performers and rights owners, and you can search your name or band name there.