What are generally regarded as "record" royalties are amounts paid to the artist from the sale of a CD, LP or cassette. They are more completely described as "recording artist mechanical royalties." The rate of the royalty is expressed as a percentage of the retail price of the mechanical media, and the percentage varies widely, depending on the negotiating power of the artist. Top artists might command 25 percent or more, while a new artist can expect much less.
The writer of a song, whether they are the performer or not, receives a royalty for each mechanical copy of a song sold, as does the publisher of the song, usually a 50/50 split. In the United States, Congress set a statutory rate of $.08 per song under five minutes or $.0155 per minute for songs longer than five minutes. This is paid by anyone who includes that song on a mechanical release. Though the rate is called "statutory," it can be negotiated up or down.
Online downloads of music are regarded as "new technology," which, under many recording contracts, allows the record company to reduce the royalty paid by up to 50 percent. Some Internet record companies use a more equitable revenue sharing model, which seems logical, as the costs and logistics associated with mechanical copies are no longer there.
Songs earn money from performance also. Each time a song is played on the radio or television, for instance, an amount is collected through performing rights societies, like BMI and ASCAP. Synchronization fees are paid for the right to match a song with pictures, as in TV and movies. These additional amounts are paid only to writer and publisher. If the recording artist is not the writer, they will see no earnings from these sources.