Welcome to the second segment of a four part series on the poison contained in a major label record deal and how you can level the playing field once you understand what’s really going on.
A lot of what happens in the music business occurs behind closed doors, and this series is dedicated to young performers (like you!) who want to know just what they are dealing with.
One of my clients was courted by a major label. As a condition of the deal, the label sent this request to the artist – in writing!!! “Because we intend to spend so much more money marketing and promoting your record than the cost of the recording, we would appreciate it if you would pay the production costs to record the album.”
Ok, we thought – no problem. So we went back to the label and said, “Prove it. Put whatever it is that you are going to do and whatever the amount is that you are going to spend into the artist’s agreement. After all, we just want to quantify your written statement into actual dollars and actions. You know, put your money where your mouth is, kinda thing. They 100% refused. Then, they had the gall to say something to the effect that, “We’re a major label. Of course we’re going to market and promote your record! That’s what we do! Ah, yes…
But wait…there’s more!
There are clauses in the agreement that indicate that should the label decide to promote your product, you will have to pay for it! All of it! Yes, if the label outsources the promotion, marketing and publicity to any third party, you, the artist, is responsible to pay for it completely. 100%. Right now, major labels outsource just about every promotional activity to a third party. Should the label decide to make a music video, you get a break here – you only pay half the costs! Whew!
Every major label contract is filled with terms and conditions that the artist must adhere to. But, upon closer examination, there is not one single thing that binds the label to do anything for the artist or spend one single penny on your project. Yes, the label will not commit, in writing, to spend one single penny on your career or your project. Forget about what they say, they can talk until they’re blue in the face – if it isn’t in the agreement, it ain’t happening!
This is not an indictment. This is simply their business model. I’m not angry. At least I know. But, you have your own business model, too, and all you want is a level playing field.
Although rare, sometimes a label wants to “license” a recording, rather than pay for it themselves. Think of it as renting the master from the artist. The label will rent the project from the artist for a specific period of time, usually three to five years. The artist maintains ownership of the masters and simply allows the label to market, promote and distribute the product. The artist receives a small advance and a royalty based on sales.