Musicians :: Understanding Music Business And How Record Labels Work!

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Most of the Record labels are publishers. Others offer 360 deals while some 270 maximum. But lets first dissect and understand what they do.

Record labels hire and employ the best musical writers. When an artist signs a record deal they are forced to give up their Master Recording copyright to the publisher. The publisher then sets them to work with THEIR writers to write songs that the artist sings. The money that comes in from licensing (putting songs on the radio, in films, in tv, etc.) goes to the publisher who gets half and the other half goes to the writers that the publisher employs and If the artist wrote something in the song they get their percentage of the half that the writers get. The publisher also makes the artist sign a mechanical licensing deal. That allows the publisher to put out CD’s, records, and sell downloads. Typically, the artist gets one dime from every unit sold. The artist, since they receive very little EARNED money, is then forced to go out and tour in order to make a living off the take from ticket sales and merchandise AND payback the generous ADVANCES given to them by the publisher. The artist, the performer, is the lowest of the low on the business totem pole. Meanwhile, the publisher is raking in money hand over first from licensing deals using the Master Recording copyright. The artist is indebted to the publisher, usually with advances in the millions. That money has to be paid back from the sale of CD’s, records, and downloads. The artist is usually on the hook also for many more albums promised to the publisher. If an artist rebels the publisher stops promoting their works and sales dwindle, putting the screws onto the artist. When they are under enough pressure, the artist is allowed to be dropped, in exchange for giving up any and all rights to their own music. When that happens the publisher then begins promoting the artist to the hilt – because the publisher their writers get all the money. None for the artist. This is the sad truth about how the music industry really works in the real world.

As an Artist always :-

  1. Keep your publishing rights to the Master Recording,
  2. Always write your own songs.
  3. Register your copyright with the government copyright office ( find registered bodies that collect royalties in your country) and then join a PRO (Ascap or BMI in America ) and register your songs yourself.

As an Artist, are you signed? How has your record label helped you? What are some of the challenges you face as an indie or Signed artist?