1.The Major Label Deal- This is the big one! A major label gives you a lot of money up front (known as an advance), to cover all the cost of creating an awesome album. The major labels have all the tools to promote your album and make you the next superstar. Be careful though, these major labels don’t have much patience. If your album doesn’t do well they won’t hesitate to drop your contract.
Sarge Tip It’s important to know that all royalties you earn from album sales will go towards paying back the advance, until you’ve paid the label back fully. So be sure to spend your advance money wisely!.
2. The Independent Label Deal- This deal is very similar to the major label deal. The difference is that independent labels are smaller so they give their artist less advance money than a major label would. The good thing about and indie label is that they work very closely with the artist and you will have more creative control over your albums. There are tons of indie labels out there, and the chances of getting a deal with one is much higher than trying to get signed by a major label.
Sarge Tip Just because you’re signed to an independent label, don’t think you can’t still make it big. If Adele, Taylor Swift, and Macklemore can become stars while signed to an indie label you certainly can too! .
3.The distribution Deal- Also known as a P&D Deal (pressing and distribution), this deal is most common for artists who have had success on their own and want to stay independent. You agree to let a record label help you manufacture, distribute, and promote your album, and in return the label gets a percentage of the sales profits (normally around 25%). Remember, that in this type of deal you don’t get an advance so you’ll have to come up with the money to produce, record, and market the album yourself.
4. 360 Deals- Also known as equity deals, participation deal, or multiple rights deal, this is the most common deal artists are offered today. In a 360 deal the label makes money not just from music sales, but from almost everything the artist does. The label gets a portion of profits generated from touring, merchandise, books, movie/TV appearances, basically anything the artist makes money from, the label gets a piece of it. This seems like a bad deal for the artists, but it does give the label even more incentive to support your career and to push you to make lots of money in every way possible.
Sarge Tip Everything in a record agreement can be negotiated, depending on how much you bring to the table, and how bad the label wants to sign you. Lastly, before you sign anything make sure you have an entertainment attorney look it over first!.
Compiled by Ernest Sallee