Hey Simo,
Radio stations pay a % of their profits every year to the relevant royalty collection society in the country of origin. E.g. in Australia APRA look after all royalties
www.apra.com.au
The songs are then divided up by a % of the amount of times played, by the amount of fees that particular radio station pay APRA. If its a Madonna song, APRA forwards on these royalties annually to the sister royalty collection place in the USA ( ASCAP ) and they in turn forward it on to the songwriters of the song in their relevant country.
It is kinda confusing, but to sum it up, you get paid more per song on a larger radio station.
You might get 12 cents a play on a small community radio, and $2 a play on Triple M or a major network. I don't envy the collection places who sort it out.
The best part of APRA and ASCAP etc is they are non profit organisations.
You get paid even more as a songwriter if your song is featured on movies, television, or even film clips on MTV or Channel V. It isnt uncommon for the songwriter to get paid above $5 everytime a major network play their film clips on Channel V.
Getting a song into a movie soundtrack is a great earner, because you get paid upfront for the rights to use the song, and then royalties on top of that everytime the movie is broadcast on cinema, TV, DVDs or video etc.