Unlocking Cover Song Royalties: Who Gets Paid and How?

What do Adele’s Make You Feel My Love, Whitney Houston’s I Will Always Love You, and Amy Winehouse’s Valerie have in common?

They are all covers! While these renditions have become iconic in their own right, the original versions were written and released by Bob Dylan, Dolly Parton, and The Zutons, respectively.

Covers have been a staple in the music industry, offering fresh takes on beloved songs, and sometimes reaching even greater heights than the originals. But what does it take to record a cover, and who gets paid when a cover song is released? Let’s dive into the details:

Do You Need Permission to Record a Cover

The short answer is: usually not. In most cases, you don’t need explicit permission to record and release a cover of a song that has already been commercially released. This is made possible through something called a “mechanical license.” A mechanical license allows artists to record and distribute their version of a previously released song, as long as they pay the necessary royalties to the original songwriters and publishers.

However, if you plan to make substantial changes to the lyrics or melody, you may need additional permissions from the copyright holder.

2. Who Gets Paid from the Exploitation of a Cover Recording?

When a cover recording is exploited (for example, through streaming, downloads, physical sales, or sync placements), several parties are entitled to royalties:

  • Original Songwriters and Publishers: The original songwriters and their publishers continue to earn royalties each time your cover is sold, streamed, or played in public, as the original composition remains their intellectual property. For instance, every time Adele’s version of Make You Feel My Love is streamed, Bob Dylan or his publisher gets a slice of the pie. These earnings come from both mechanical royalties (for the recording) and performance royalties (for public plays).

  • Recording Artist and Record Company: The artist who records the cover (and, if signed, their label) earns royalties for the new sound recording. This is separate from the composition royalties that go to the songwriters. So, when Adele’s version of Make You Feel My Love is played, she and her record label receive sound recording royalties.

Recording and releasing a cover is a great way for artists to pay homage to songs they love, while still allowing the original creators to be compensated for their work. Understanding the mechanics of permissions and payments ensures that everyone involved in the creation of music is recognised and rewarded for their contributions.

3. Who Pays the Mechanical Royalties for Cover Songs? 

When it comes to mechanical royalties for cover songs, the method of payment depends on the format of distribution.

For streaming, digital service providers (DSPs) like Spotify or Apple Music pay mechanical royalties under a blanket license. This means that DSPs, through agreements with collection agencies, cover all the songs in their catalog, ensuring songwriters and publishers are compensated without needing individual licenses for each song.

For physical sales, the releasing record label is responsible for paying mechanical royalties on a case-by-case basis. The label must obtain a mechanical license, often through organisations like PRS (in the UK) and The Harry Fox Agency (in the US), and ensure the original songwriters and publishers are paid for each copy sold (or manufactured depending on the territory).

Understanding who pays the mechanical royalties is crucial for ensuring that the original creators are properly compensated for the exploitation of their work.

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