**The Ultimate Guide to Online Beat Licensing**

*by Blue Flower*

What began with a few hundred producers sharing beats on platforms like SoundClick and MySpace has grown into a multi-million dollar industry, now led by marketplaces such as BeatStars, Airbit, and Soundee. With modern tools, anyone can build a website and start selling beats—but licensing music is still serious business.

In this guide, we’ll break down the fundamentals of beat licensing and explain the key differences between **Non-Exclusive** and **Exclusive** licenses. Whether you’re an artist looking to buy beats or a producer selling them, this guide will give you a full understanding of how it works.

**Part 1: What Is Beat Licensing?**

Beat licensing is the process of granting an artist permission to use a producer’s instrumental in a song, under specific terms defined in a **license agreement**. This agreement outlines the legal rights of the artist to use, distribute, and monetize the song.

**Important**: You’re not buying the beat itself—you’re buying a license to use it.

**Non-Exclusive Licenses (Leases)**

Non-exclusive licenses are the most common and affordable, usually priced between $20–$300. These allow artists to release music on platforms like Spotify, YouTube, and Apple Music—often instantly from the producer’s online store.

Each license includes a set of usage rights and limitations. For example:

- **Streaming caps** (e.g., 50,000 Spotify streams)

- **Video view limits** (e.g., 100,000 YouTube views)

- **Expiration dates** (e.g., valid for 1–5 years)

These licenses can be sold to multiple artists at the same time. That’s great for beginners, but not ideal for artists with larger audiences or label support.

Most producers offer several non-exclusive tiers:

- **MP3 License** – Basic rights

- **WAV License** – Higher quality files

- **Premium License** – Includes tracked-out stems

- **Unlimited License** – No streaming or usage limits

**Exclusive Licenses**

Exclusive rights offer full creative control and flexibility. You get:

- Unlimited streams, views, and downloads

- No expiration

- Rights to use the beat in multiple projects (albums, singles, music videos)

Once a beat is sold exclusively, it cannot be sold again. However, existing non-exclusive licenses remain valid. These agreements typically include a clause like **"notice of outstanding clients"** to protect earlier buyers.

**Part 2: Royalties, Writer’s Share, and Publishing**

This is where licensing gets complex—but don’t worry, we’ll break it down step-by-step.

**Two Types of Royalties**

- **Mechanical Royalties**: Generated from sales and streams (Spotify, iTunes, etc.)

- **Performance Royalties**: Earned when music is played publicly (radio, live shows, etc.)

**Mechanical Royalties**

Typically, artists keep **100%** of mechanical royalties with both license types. However, in **exclusive agreements**, producers may request a small percentage (1–10%)—known as **points** or **producer royalties**. This acts as an *advance* on royalties in case the song becomes a hit.

**Performance Royalties**

Collected by Performing Rights Organizations (PROs) such as ASCAP, BMI (US), or PRS (UK), these are split:

- **50% to Writers (Songwriters/Producers)**

- **50% to Publishers**

Example:

- 50% Producer

- 25% Lyricist A

- 25% Lyricist B

Unless the beat was created under a **work-for-hire** agreement (which transfers all rights), producers always retain their share of songwriting and publishing rights.

> 💡 If you're not signed to a publishing administrator, you may be leaving half your royalties uncollected.

**Part 3: Copyrights – Who Owns What?**

When a song is created using a licensed beat, two copyrights are involved:

1. **PA (Performing Arts) Copyright** – Covers the composition (beat + lyrics)

   - **Producer** owns the beat

   - **Artist** owns the lyrics

2. **SR (Sound Recording) Copyright** – Covers the final audio recording (aka the Master)

   - **Exclusive License**: Artist owns the Master

   - **Non-Exclusive License**: Producer retains ownership; artist has limited use rights

If you're working under a non-exclusive license, your song becomes a **Derivative Work**—a legally permitted remix or variation of the original beat.

**Using Sampled Beats**

Here’s the big issue:

**Both producer and artist are responsible for clearing samples.**

Even if the beat was licensed, using uncleared samples can expose *everyone* to copyright claims. That’s why many producers avoid sampling altogether.

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**Part 4: Choosing Between Exclusive and Non-Exclusive**

So, which is best for you?

Ask yourself:

- How many fans or streams do I have?

- What’s my budget?

- Am I backed by a label?

- Is this song likely to blow up?

If you're early in your career, a **Non-Exclusive Unlimited License** gives you the best flexibility at a lower cost. You can release more music, test the market, and build a fanbase without spending hundreds or thousands.

**FAQ – Quick Answers**

**Q: Can I contact the exclusive buyer to license a beat they bought?**

**A:** No. Exclusive licenses forbid resale or redistribution of the beat.

**Q: Can I remake a beat I already sold exclusively?**

**A:** Not if it copies melodies or samples from the original.

**Q: What if my non-exclusive license is about to expire, but the beat is now sold exclusively?**

**A:** You’ll need to take the song down or negotiate a new beat—unless you had an Unlimited License.

**Q: What if someone used my beat without a license?**

**A:** First, contact them. Offer to sell a license or ask them to remove it. If they refuse, consider a **DMCA takedown**.

**Q: I co-produced a beat. How should we split royalties?**

**A:** Common splits are 50/50 for both publishing and writing. If the artist gets 50%, the remaining 50% is split between producers.

**Final Thoughts**

Licensing beats online isn’t just about uploading a few tracks and hoping for sales—it’s a professional process rooted in copyright, contract law, and royalties. But once you understand how the system works, it opens up incredible opportunities.

Thanks for reading!