The Mechanical Licensing Collective (The MLC), the United States mechanical rights body based in Nashville, has distributed more than USD $4.2 billion in royalties to songwriters and publishers since January 2021, and will begin paying out remaining unmatched and unclaimed royalties on a market share basis in April 2027.
The organization confirmed the figure at its Annual Membership Meeting on Tuesday, September 29, while reviewing its first five years of operations. It has processed nearly $5 billion in total royalties over that period.
“We’re proud of the progress The MLC has made since beginning operations in 2021 and we’re grateful to our Members and industry partners for their continued engagement and support,” said Kris Ahrend, CEO of The MLC. “Distributing more than $4.2 billion in total royalties to rightsholders is an important milestone. We’re grateful for the opportunity to continue our work following the Copyright Office’s decision to continue our designation. The start of market share distributions in April 2027 represents another important step in fulfilling The MLC’s statutory responsibilities under the MMA. We remain focused on carrying out that work and continuing to serve our Members and the broader rightsholder community.”
First market share distribution#
The April 2027 payout will be the first time The MLC has used the market share mechanism written into the Music Modernization Act (MMA). Those royalties are funds The MLC has collected but has not yet been able to match or distribute.
The MMA requires The MLC to pay them out eventually, with statutory interest, to rightsholders based on their relative market shares. The MLC pays out initially unmatched royalties once their owners are identified. Under the MMA, it must hold unclaimed accrued royalties and continue trying to match and distribute them for a minimum of three years.
Unclaimed accrued royalties include both unmatched and unclaimed royalties:
- Unmatched royalties are tied to a recording that The MLC has not been able to link to a song in its database.
- Unclaimed royalties are tied to a song The MLC has identified but whose ownership shares have not all been claimed by a Member.
The MLC will start with remaining royalties from January 2021 usage, the first month in which digital service providers (DSPs) reported royalties under the blanket compulsory mechanical license it administers. That month will be paid out in the April 2027 royalty distribution, with the rest of 2021 following one usage month at a time.
By the time that first payment is made, The MLC will have spent more than six years attempting to match and distribute the blanket royalties reported for January 2021 usage. The MLC describes that as twice the statutory minimum holding period, and says it is mindful that Congress did not intend for it to hold onto the remaining royalties indefinitely. Because only one month of remaining royalties will be paid out in each distribution, The MLC says it will end up spending more than six years on every subsequent month of usage as well.
The MLC says on its website that it was holding just over $6 million in remaining unmatched and unclaimed royalties from January 2021 usage as of the completion of its September 2026 royalty distribution. That figure was below $7 million as of the January 2026 distribution. It expects the amount to fall further before the first market share distribution, and expects the remaining royalties from subsequent months of 2021 usage to be comparable.
Allocation method and songwriter floor#
The MLC will allocate the remaining royalties on a song-based, pro rata basis, separately for each DSP and offering, using reported usage data and its own distribution data rather than estimates of market share. Every song that earned blanket royalties from a given DSP and offering during the applicable usage month will receive its pro rata share of the remaining royalties for that month. The MLC will count all royalties distributed for each song, whether they were paid in the initial distribution for that month or through later reprocessing.
The MMA also sets a floor for the share of those royalties that must go to songwriters. Publishers and administrators that receive unclaimed accrued royalties must pay or credit at least 50% of the amount attributable to a songwriter’s works to that songwriter, regardless of contract terms.
Membership and database growth#
The MLC now has more than 100,000 Members, having added over 27,000 to date in 2026, while its public database holds data for more than 60 million works, an increase of over 8 million this year. Its Songwriter Hub now has more than 20,000 users, and the organization staged nearly 200 outreach and education events in 2026, part of more than 1,300 such activities to date.
The MLC reported a match rate of more than 92% for all royalties processed through its September distribution. It says on its website that the rate rises to 94% across 2021 usage. At last year’s Annual Membership Meeting, the collective reported more than $3 billion in total royalties distributed, over 68,000 Members, and data for more than 50 million works.
Historical unmatched royalties#
The MLC has matched more than $317 million of the historical unmatched royalties DSPs could not distribute themselves, covering streaming between 2007 and 2020, and has distributed $238.72 million of that to the rightsholders it has since identified.
The total transferred was $424.38 million when DSPs handed the money over in 2021, later rose to $426.9 million, and fell to $397.29 million in February 2024 when DSPs delivered adjustments reflecting the Phonorecords III rates finalized by the Copyright Royalty Board.
