We all have some idea about how radio royalties work. (Or at least we would like to think so). When you hear a song on the radio, do you know gets paid? Most of those hits you hear on the radio, the bands you hear playing them, didn’t actually write the song. Music publishing has nothing to do with the artist. Royalties get paid to the songwriter and the publisher.
Radio airplay is part of your public performance royalties. They generate performance royalties for a songwriter that are collected by your performing rights organization. Songwriters should be signed up with BMI, ASCAP or SESAC. In the United States, broadcaster (this would be your AM or FM radio stations) will only pay the songwriter, not the performer or sound recorder. So every time you hear one of those annoying One Direction songs on the radio, they don’t get paid one pretty penny. Whoever wrote their terrible songs is the one who will be collecting the money each and every time that song comes on a radio station around the United States. Artists aren’t making their money from the radio unless they are the ones who wrote the song. Performing artists make their real money from touring and merchandise.
So if you want to make money as an artist, you need to write or at least have a hand in writing the songs that make it to the radio stations. This is why a lot of people only write songs for a living and sell them to artists. If you get one good song to be recorded by someone famous and it gets crazy air play, you will be collecting royalty checks from the performing rights organizations until they decide to stop playing that song on the radio. If you are not a performer who tours, song writing is where the money is.