Every recorded song carries two distinct copyrights. They are owned by different parties, licensed separately and paid through different channels.
The composition and the recording are separate works
One copyright covers the underlying composition: the melody, harmony and lyrics as written. It is typically owned by the songwriters and their publisher.
The other covers a specific recorded performance of that composition, and it is typically owned by the record label or by an artist who financed the recording.
A cover version creates a new recording of the same composition, which is why the songwriter is paid for it while the original recording's owner is not.
Performance rights are collected centrally
When a composition is performed publicly, whether on radio, in a venue or in a business playing music, the songwriter's side is owed a payment.
Tracking every use individually would be impossible, so collecting societies license users on a blanket basis and distribute the proceeds to their members.
Distribution relies on reporting and sampling rather than complete measurement, which is a long-standing source of complaint from writers of less frequently played work.
Reproduction is licensed differently
Making copies of a composition, whether physical or digital, involves a separate right, and in the United States a statutory mechanism sets the terms for cover recordings.
That mechanism means an artist who wants to record an existing song does not need the writer's permission, provided the required payments are made.
The writer cannot refuse, but also cannot be bypassed, which is a deliberate balance struck to keep songs circulating while ensuring writers are paid.
Streaming pays both sides from one pool
A streaming service licenses both copyrights and pays out of subscription and advertising revenue, with the recording side historically receiving the larger share.
Payments are generally calculated by dividing revenue among rights holders in proportion to streams rather than by a fixed rate per play.
This means the amount attached to a single stream is not a constant, and it varies by country, subscription tier and month.
The chain has many hands
Money passes through distributors, labels, publishers and collecting societies before reaching a writer or performer, and each stage takes an administrative share.
Recoupment adds another layer, since advances paid to an artist are recovered from earnings before further payments flow.
Understanding which copyright a payment relates to is the first step in reading any music statement, because the two sides settle on different schedules entirely.