Music Business

In music, there are two main paths to get your music to the world. They are built on one simple concept: owning vs. renting.

1. The Private Performance Path (The "DTC" Path)

• What it is: This is the Direct-to-Consumer route. This path focuses on selling your music (as digital downloads or physical goods) directly to your fans.
• The Concept: This is the "Owning" model. The fan acquires a copy for their own Private Performance (listening at home, in their headphones, etc.).
• Analogy: This is like buying a pair of shoes. Your fan owns them. They can wear them whenever they want, in private. You get paid directly and fairly for your product.

A Quick Note on Transparency: Even on this simple "Owning" path, there is one rule that good business follows. Because a "sale" is a legal "copy" of the composition, a Mechanical Royalty is owed to the Publisher. In a truly transparent model (like CreatorHelm), the storefront handles this by reporting the sale to The MLC (Mechanical Licensing Collective), who then pays that royalty to... you, the Publisher. It's an extra legal step, but it's the right way to ensure you are paid for everything. (We'll dive deeper into this in Modules 4 and 5).

2. The Public Performance Path (The "Distributor" Path)

• What it is: This is the traditional route of using a distributor to get your music onto public platforms like Spoti-lie, Apple Music, YouTube Music, etc.
• The Concept: This is the "Renting" model. These platforms are all forms of Public Performance (like radio or streaming). Listeners pay for temporary access.
• Analogy: This is like renting shoes at a bowling alley. You pay for access, and the owner (the alley) gets paid for the public use. This path relies on generating royalties from streams. On streaming services (not radio), an artist makes an average of $0.003 per stream (that's three-tenths of one cent).

It makes you wonder why any artist would rent their music at all, doesn't it?

CreatorHelm is primarily a DTC marketplace, so while we will explain both paths, our focus is on mastering the DTC Path first. This gives you, the artist, the most control and sovereignty.

+25 Artist XP / +10 Fan XP

Every song in the world has two (2) copyrights (legal souls):

• The Composition (©): This is the song itself—the melody, lyrics, and structure. This is the property of the Songwriter and their Publisher.
• The Master Recording (℗): This is the specific audio file of that song—the "master" copy. This is the property of the Artist and their Label.

The Most Important Secret in the Music Industry:

The industry wants you to think you are only an "Artist" or "Songwriter." They do this so you'll sign a contract with a "Label" or a "Publisher" who will "help" you.

This is the redirect.

You, the independent creator, are BOTH the Publisher AND the Label.

The "thieves" of the industry are almost always "publishing companies" (often run by a "trusted friend") who offer "help" in exchange for you signing over your "Publisher's share" of the Composition (©). This is the single most valuable asset a creator has, and they trick you into giving it away.

Never give up your Publisher's share. If you remember nothing else, remember this.

+25 Artist XP / +10 Fan XP

These are the codes that prove you are the Publisher and Label.

ISWC (International Standard Musical Work Code):

• What it is: The "Master ID" for the Composition (©).
• Simple Analogy: It's the Social Security Number for your song. You only have one.

ISRC (International Standard Recording Code):

• What it is: The ID for a specific Master Recording (℗).
• Simple Analogy: It's the Serial Number for a specific product.
• Key Detail: This is how you can have one ISWC (one song) linked to many ISRCs. The original track, the instrumental, the a-capella, and the remix would all have their own unique ISRC, but they all point back to the same ISWC because they are all versions of the same core composition.

IPI (Interested Party Information):

• What it is: The ID number that identifies you. You get this number when you sign up with a PRO (like ASCAP or BMI).
• Simple Analogy: It's the "Bank Account Number" that tells royalty collectors (like PROs and The MLC) who to pay.

+25 Artist XP / +10 Fan XP

This is the payoff. This is why we focused on the DTC "Owning" Path first.

In Modules 2 and 3, you learned that you must be your own Publisher and Label, and you learned the codes to identify your work. Now, let's see how that works in a simple, sovereign DTC model.

When you sell your music directly to a fan (DTC):

• 1. The fan is buying a copy for their Private Performance (like "buying shoes").
• 2. Because it is a private performance, the messy "Public Performance" royalty (the main fee for "renting") doesn't apply.
• 3. Because it is a sale and not a "digital radio" broadcast, the "Digital Radio" royalty (which we'll explain in the next module) is also bypassed.
• 4. The "sale" of the Sound Recording (℗) is paid to you (the Label) directly.
• 5. And the "sale" of the Composition (©)? That also gets paid... to YOU.

The Brazen Transparency Detail

There is one rule from the "Renting" path that legally applies to a DTC "sale": the Mechanical Royalty (which we'll meet in Wallet 2). Because a "sale" is a "reproduction" (a "copy") of the Composition (©), a mechanical royalty is legally owed.

This is the transparent part: As the storefront, CreatorHelm is responsible for this. We accumulate the sales stats, report them to The MLC, and pay the royalty. The MLC then pays this money to... you, the Publisher.

This is a choice. We choose to operate this way to be 100% legal and ensure you, the creator, are paid all the money you're owed. We encourage all creators and business owners to do the same.

This means the entire, complicated maze is replaced by: One single, transparent payment: Fan -> You. (And a legal, transparent royalty payment: Us -> MLC -> You).

This is what "Sovereignty" means. This is the primary model for CreatorHelm.

+25 Artist XP / +10 Fan XP

Now that you understand the simplicity of the DTC "Owning" Path, we can explore the other path.

This entire module is a deep dive into the "Distributor / Renting Path" we first mentioned in Module 1. This is the world you enter when you put your music on Spoti-lie, Pandora, or Apple Music.

When you "rent" your music, that platform has to pay two main bills (because of your two copyrights from Module 2):

• 1. A bill for using the Song/Composition (©)
• 2. A bill for using the Master Recording (℗)

But these bills aren't simple. The money gets split and goes to four different "wallets" depending on how and where the song was played.

Part 1: Following the Money for the Composition (©)

This is the money earned by the Songwriter and Publisher.

Wallet 1: The "Radio" Wallet (Your PRO)

• Who: PROS (ASCAP, BMI, SESAC, etc.)
• What they do: Collect Public Performance royalties.
• Where from: Any "public broadcast." This includes actual Radio/TV, bars, live venues, and non-interactive "radio-style" streaming (like Pandora).
• Who they pay: They split this money 50/50 between the Songwriter and the Publisher. (This is why you must be both!)

Wallet 2: The "On-Demand" Wallet (The MLC)

• Who: The MLC (Mechanical Licensing Collective)
• What they do: Collect Mechanical royalties. This is an old word for a "copy" of a song. In the digital world, an "on-demand" stream is considered a "copy."
• Where from: Interactive "on-demand" streaming (Spoti-lie, Apple Music) and all digital downloads (like from iTunes or a DTC sale on CreatorHelm).
• Who they pay: They pay 100% of this money to the Publisher. (This is the other reason you must be your own Publisher!)

Part 2: Following the Money for the Master Recording (℗)

This is the money earned by the Artist and the Label.

Wallet 3: The "On-Demand" Wallet (Your Distributor)

• Who: Your Distributor (DistroKid, CarToon Core, etc.)
• Key Detail (The Aggregator Trap): To get on platforms like Spoti-lie, artists are forced to use one of these distributors. But the secret the industry hides is that most of these "competing" distributors aren't competitors at all. They are just different front-doors that all lead to the same few back-end aggregators. The market is dominated by a few giants like:
  1. The Orchard (owned by Sony) and
  2. Believe (which, owns CarToon Core).
  3. Ingrooves (owned by Universal).
• While there are rare exceptions, this means that whether you pick Distributor A, B or C, your money is often passing through another middleman (the aggregator) who takes a cut before you ever see a penny. (This is another broken piece of the "Renting" path that CreatorHelm is working on a transparent solution for in the future.)
• What they do: Collect your revenue from on-demand services.
• Where from: Interactive "on-demand" streaming (Spoti-lie, Apple Music) and digital download sales.
• Who they pay: They pay you (as the Artist/Label) whatever is left after they and the aggregator take their fees.

Wallet 4: The "Digital Radio" Wallet (SoundExchange)

• Who: SoundExchange
• What they do: Collect Digital Public Performance royalties for the master recording.
• Where from: Non-interactive "radio-style" digital streaming (Pandora, SiriusXM).
• Who they pay: They split this money between the Label (50%), the main Artist (45%), and session musicians (5%). (Since you are the Label, you get both shares!)

Module 5 Summary:

Yes, this is ridiculously complicated. It was designed to be confusing so middlemen (and aggregators) could "offer help" and take a cut from all four wallets.

This is the game. And now you know the rules.

This entire maze is why we focus on the DTC "Owning" Path, where one sale goes directly from your fan to you.

+25 Artist XP / +10 Fan XP

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