Collecting Societies Explained: What PROs and CMOs License and What They Don't

Collecting societies license certain uses of music in bulk and pass the money back to songwriters, publishers, performers and labels. They are the reason a bar, a radio station or a streaming service can play millions of songs without signing millions of contracts. They do not license everything, though, and knowing where their role stops saves a lot of confusion.

What collecting societies do

A collecting society pools rights from many creators and rights holders. It then:

• Grants licenses to music users, often as a blanket license covering its whole repertoire.
• Collects fees based on tariffs, usage reports or negotiated rates.
• Distributes royalties to its members, after deducting administration costs.
• Works with foreign societies through reciprocal agreements, so a song played abroad still earns money at home.

In the US, the common term is PRO (performing rights organization). In the EU, the legal term is CMO (collective management organization). Both describe the same basic idea.

The three main rights societies handle

Performance rights (compositions)

Every time a song is played in public, broadcast or streamed, the composition is "performed." Performance societies license this for songwriters and publishers. Examples include radio play, TV broadcasts, music in shops and restaurants, live concerts and streaming.

Mechanical rights (compositions)

A mechanical right covers reproducing a composition, for example on a CD, a download or an on-demand stream. In some countries the same society handles performance and mechanicals. In others they are split.

Neighboring rights (recordings)

Neighboring rights, also called related rights, protect performers and record producers in the recording itself. Societies collect money when recordings are broadcast or played in public. These rules differ a lot by country, as the US section below shows.

Examples by country

Germany

• GEMA represents composers, lyricists and music publishers. It licenses both performance and mechanical rights in musical works.
• GVL represents performers and record producers. It manages their neighboring rights in recordings, such as remuneration for broadcasting and public playback.

In German practice, courts have long applied a presumption that GEMA represents the music being used in public. Users who claim the music is not GEMA repertoire generally have to show it.

United Kingdom

• PRS for Music represents songwriters, composers and publishers for performance rights. Through MCPS it also handles mechanical rights.
• PPL represents performers and record companies for recordings played in public or broadcast.
• Since 2018, PPL and PRS have offered a joint license for many businesses, called TheMusicLicence, through their joint venture PPL PRS Ltd.

United States

• ASCAP, BMI and SESAC license public performance rights in compositions. A songwriter usually affiliates with one of them at a time.
• SoundExchange collects digital performance royalties for sound recordings from services like satellite radio and webcasters operating under a statutory license. It splits royalties 50% to the rights owner, 45% to featured artists and 5% to a fund for non-featured artists.
• The MLC (Mechanical Licensing Collective) administers the blanket mechanical license for eligible digital audio services, such as on-demand streaming and downloads. It began on January 1, 2021, under the Music Modernization Act of 2018.

One US difference stands out. There is generally no performance royalty for sound recordings on AM/FM radio. Recording royalties for performance mainly come from digital transmissions, which is why SoundExchange exists.

What societies license

Societies are built for high-volume, repeatable uses where individual deals would be impractical. Typical licenses include:

• Blanket performance licenses for radio and TV broadcasters.
• Venue and business licenses for bars, clubs, gyms, shops, hotels and event organizers.
• Licenses for streaming and download services, covering performance and, in many countries, mechanical rights.
• Mechanical licenses for physical products in many territories.

Tariffs and rates vary by country, type of use and size of the business. Check the society's own tariff pages for current figures.

What societies usually do not license

Some uses need a direct deal with the rights holder. These usually include:

• Sync licenses. Putting music in a film, ad, game or online video usually requires permission from the publisher for the composition and from the label for the recording.
• Master use. Societies rarely grant the right to copy a recording into a new production. That comes from the label or whoever owns the master.
• Sampling permission. Societies do not clear samples. You negotiate with the master owner and the publisher.
• Adaptations and changes. Rewriting lyrics, making a new arrangement for commercial release or translating a song typically needs the songwriter's or publisher's consent.

There are local exceptions. Some societies handle certain sync or production music uses in specific markets. When in doubt, ask the society what its license covers.

Why a direct license may still need a society license

Many people assume that once they license a song directly, they are fully covered. Often they are not.

When a songwriter joins a society, they usually assign or grant their performance rights to that society. That means the publisher or songwriter may no longer be able to license public performance directly. So:

• A sync license for a video covers putting the music in the video. Broadcasting or publicly showing that video may still need a performance license, which TV stations and platforms usually hold through their society deals.
• A business that licenses background music directly from a label may still need a society license for the composition if the songwriter is a society member.
• An event organizer who agrees fees with an artist still usually needs a performance license for the songs played.

The reverse is also true. A society license does not give you sync, master use or sampling rights.

How to work out what you need

Ask four questions:

1. What exactly will happen to the music? Played in public, broadcast, streamed, copied, synced or sampled?
2. Which side is involved? The composition, the recording or both?
3. Who controls each right? A society, a publisher, a label or the creator directly?
4. Where will the use happen? Society coverage is territorial, and the rules differ by country.

Once you know that, you can get the society licenses for the bulk uses and negotiate direct licenses for the rest.

Clearhly is a marketplace in private beta for that direct side: verified rights-holder businesses list music they control, and licensees can request, negotiate, e-sign and pay through Stripe. Every rights holder on Clearhly goes through business verification and confirms, for each listing and share, that they own or control the rights they license, and your license is a contract directly between you and the rights holder. The full legal terms are in the Terms of Service.