That number just seems absurd. But the reality is that an advance may not relieve their financial pressures, but rather add to it (more on that later). well also I encourage every band to be their label and tell us all how much money they make AFTER covering all the label expenses… silly rabbits…. At a major, typically, the label manages all of the spending for a given project. To understand the second point, consider the list of deliverables. Hey! However, many audit clauses require that the record label pay for the audit if a large discrepancy is found. As a result, the label pays all the recording costs, including the producer advance. If nothing, you might be better off continuing your merry way as an independent artist. [Pictured: Ed Sheeran, the world’s biggest recorded music artist in 2017, according to IFPI stats. Not including marketing costs, or the $ that people like itunes keeps, etc. As producers’ independence grew, so did their importance, and nowadays, the sound they create is so important that on a pop or hip-hop record there may be multiple producers for each track. She also forced UMG to agree to share its $1 billion stake in Spotify with artists when the label sells when the label re-signed her. If you can point us to some articles that provide a different view, from unbiased sources, I would be very interested in reading them. whaddya think?? And, if you’ve ever been in financial trouble, you know that credit is expensive. These emails form part of the service you elect to receive when you subscribe to any of MBW's free email services. Do not look at it as your ticket to fame and fortune, or as a hall pass to party. (It should also be noted that this 10% rate has been maintained despite – according to an RIAA-commissioned report – the number of artists signed by US major labels rising 12% to 658 in 2017.). I've seen unscrupulous record labels use five- and even 10-year terms, locking their artists into long-term contracts that destroy their artists' creative lives and financial futures. Producers: take ownership of your role. MBW has drilled down further into the changing spending patterns of the record industry (via IFPI statistics published since 2008) and noticed a striking macro trend: the amount of money labels are paying to sign and develop artists is mushrooming, while increasingly eating into these companies’ potential profits. MArtin Atkins. But this doesn’t mean they won’t make some mistakes. var F14249_sb_wait=setInterval(F14249_sb_wait_fn,100); Start your FREE subscription to Hypebot today. Mashable, Inc. All Rights Reserved. The math is very very misleading. In addition, you should think about negotiating a minimum marketing spend as a part of your release commitment. If it sounds like CYA, it is—if any of these items is not delivered, bad things can happen. It’s a false equivalency. Somewhere in there, he’s also in the band. Gerry. Betty Who with her RCA record contract. Like Trent Reznor says, if you don’t want to be the Pussycat Dolls stay away from the labels. First, an important clarification about the IFPI data above: the ‘A&R’ figure includes obvious artist expenditure such as money required for recording studio time, as well as remixes and other costs related to making music. Don’t be blinded by the short-term opportunity. And these are only two of the many issues that can come up for a label. The general DIY idea is good but I have yet to see it work in the real world. Don’t get me wrong – It is possible to negotiate your contract. I’ll have to grab them when i get home, as i have a few bookmarked. A Simple Guide To Getting Heard On Spotify. This led to increased costs for labels. The above stats might offer some clues as to how much you should try to get as a newly signed artist. Artists often ask me how they can ensure the record label is being honest with them about the total number of albums or tracks sold. You never know where your career will take you, and it's important to keep your options open. But you could also fail, even if you are awesome in every regard. I’ll take 13% of a million over 70% of nothin’ ANY day. Yet in 2015, the figure jumped – up to 16.9%, as revealed by that year’s ‘Investing In Music’ report. . We saw it in IFPI reports regarding 2008, 2011, 2013 and 2015 data – most of which were labelled ‘Investing In Music’. The publication poured through recent investor filings from Universal Music Group’s parent company Vivendi, Sony, and Warner and found that the companies are totaling $19 million in daily streaming revenue. Yet the fresh IFPI statistics published here tell us something very important: as artist power in label negotiations continues to grow, and the industry’s resultant deals get ever more competitive, the record business’s new-age economics are really starting to show. This chart maybe correct but we also need to know or see the investment chart how much does the record label spend for a CD release vs how much does an independent band/artist spend for a CD release. That’s even after a raise from Spotify as Keating’s 2018 payout per play was greater than it was in previous years. This is the main reason artists tend to seek representation. Here’s what you should know about record label advances. I already have an opinion and am more interested in hearing yours. I’m gonna view this as slightly misleading until I see the source of the stats. A report in 2015 noted labels were keeping close to 45 percent, and artists were lucky to get 7 percent. They are unlikely to take too many chances on unproven acts. Meek’s ideas about ownership, cost-sharing, and scams may sound great, but they’re naïve. I have yet to encounter an artist/ band, except for cover bands, that can make a living on a DIY-basis but I have encountered a few with a team (be it a indie label or friends/ colleagues helping out) behind them who do fairly well and I know a few on major labels swimming in money. Breaking it down that way, labels stuff their purses with 73.1 percent of the payouts, songwriters and publishers split 16 percent, and the artists keep just 10.9 percent. A label can provide things that an independent artist cannot. Now, as a standalone artist, you can do many of these things yourself, but it will cost you (a lot of) time and money that is not factored in above- wouldn’t that time be better spent making music and performing? Delivered for FREE, direct to your inbox each day. They make an interesting contention that it is important to support the artists themselves and their music, and not the major label hierarchy. This article doesnt mention the expenses laid out though. I realise my numbers are all mildly educated guesses and points may have been missed… Please educate / debate if necessary! thus he would just become like the record label. millions – the indie artist is working on a mostly local/viral scale – tens of tohusands, the big exit for an indie is to be picked up by a record label. By limiting the length of your contract to one year, not including option periods, you prevent a record label from effectively controlling your life and creative work for an unreasonable amount of time. A lot of what is said ties directly to my statement about contacts, marketing, etc. hbspt.cta._relativeUrls=true;hbspt.cta.load(245581, '794b5400-e0ed-4122-b7b9-c9e6548cb406', {}); Topics: As in indie artist without a label, you will still have to pay X along the way to companies and people that help you out with various services… What’s the problem? David Crosby notably complained about streaming services’ low pay on Twitter last year. Before paying you even one cent in royalties, the record label is typically allowed to recoup much of its expenses through so-called "deductions." I wont deny a musician can do a lot on their own, and should – and can even create their own label, but there is a point that they will still have to hire people to help with the push, its going to be very rare that a musician has a connection into the press outlets that can really make a large difference on sales. Understand The Risks & Make Wise Decisions, ‘5 Steps To Profitable Youtube Music Career’ ebook, http://www.ifpi.org/how-record-labels-invest.php, https://www.thebalance.com/how-does-a-record-label-decide-advance-2460963, https://www.thebalance.com/should-i-ask-for-a-big-advance-2460669. Over the past decade, the IFPI’s published statistics regarding record industry investment in artists have always come with a very clear underlying message: the record industry spends more on ‘A&R’ (ie. Bottom line, and I beg people to remember this: Putting yourself in iTunes, Amazon and CDBaby does not differentiate you from the thousands of other bands who paid the account setup fee – at all.