Royalty Rate

A royalty rate is the percentage of revenue or a fixed amount that a business or individual pays to a rights holder for the use of their intellectual property, such as patents, trademarks, or copyrights. For example, if a music company sells a song and pays the songwriter 10% of the sales as a royalty, that 10% is the royalty rate. This arrangement allows creators to earn money from their work while enabling others to use it legally. Royalty rates can vary based on the industry, negotiation, and the value of the intellectual property.