Your options are limited. There are three types of income generated when someone uses your music as the soundtrack for a YouTube video (referred to as user-generated content, or UGC) and each type of revenue has its own rules.
- The performance royalty is paid by the songwriter's performing rights society (either BMI, ASCAP, SESAC or SOCAN). These payments are small (one songwriter reported receiving $80 for nine million video views). To get paid you have to belong to a performing rights society and have registered your song titles. The society's payment is based on data from YouTube's Content ID system (more on that, later).
- The mechanical-sync payment is made to the owner of the song (usually the songwriter or a music publisher). It's a payment for the right to use the song on the video's soundtrack. Your publisher may have made a confidential blanket arrangement with YouTube and your payment, if any, would be determined by your publishing agreement. Songwriters who have not signed with a publisher can affiliate with a company that collects these payments such as Songtrust, Audiam, or CDBaby Pro Publishing.
- The sound recording royalty is paid to the owner of the master recording of the song (usually a label, producer, or the artist). When your music is included on user-generated content -- for example, your song is used as the soundtrack for a dancing puppies video -- you are entitled to a cut of the revenue from advertising on the dancing puppies' page. However, you are entitled to the revenue only if YouTube has notice that your recording is used on that video. The notice is usually supplied by YouTube's Content ID system.
The Content ID system makes an audio fingerprint of your music and scans YouTube. If it finds a match, the music owner can shut the video down, or monetize it for ad revenue. Music labels have partnered with YouTube to bring their music into Content ID. Unsigned musicians, if they qualify for Content ID, can apply directly to YouTube to be part of the program. Distributors like CDBaby will manage the Content ID collections for you.
What to do? Assuming you own the master recording, you'll have a hard time obtaining sound recording royalties. YouTube pays ad revenue after it receives notice and apparently somebody failed to register your music with Content ID. You should have received performance royalties if you registered your compositions with BMI, ASCAP, etc. Your publishing agreement, if you can decipher it, should spell out your publisher's obligation. Speaking to a lawyer would be your best bet, but unfortunately, considering what musicians earn on YouTube, hiring a lawyer might not be worth it.