What royalties does a musician have to pay to do a cover version of another song?
Unless things have changed, songwriter royalties are 6c per unit sold. Half goes to the songwriter and the other half goes to the licensing agency (BMI or ASCAP). It is my understanding that bars that have cover bands pay a set fee to BMI and ASCAP annually that is supposed to cover songwriter royalties (it’s based on some formula that would make the most brilliant mathematician’s head swim); hence the “ASCAP” or “BMI” sticker on the doors or windows as you walk in. If an artist records a song, the songwriter royalty is paid out of the sales of the album. For example, if an album sells a million copies, that would be $60,000 in royalties, half of which would go to the songwriter(s).
