Hey everyone,

A lot of people I talk to about the merits of purchasing music over downloading it say that artists don't get nearly enough money from album sales. A lot of people I've talked to say that most of the money an artist makes is from merchandise and touring.

I was wondering if anyone had any statistics on this? I've tried searching around online and only came back with a few people using the excuse most downloaders use. I'm looking for actual statistics though, leaning either way.

Any help would be great. Thanks.

I've heard that new artists have it even worst as they have to "pay back" all kinds of fees charged by the record company. Actually, I believe they just don't receive royalties until these fees they owe are paid off.

However, I think you can make the arguement that the record company is right in giving only small royalties as they are taking all the risk.

Maybe if they didn't frontload the deal with all the payola to the radio stations and just let the music sell itself?




If you do a search, there was article written a few years back by (I'm pretty sure) Courtney Love. Very informative and well written.

Some of it would depend on the record label. I know Nirvana got really screwed with Nevermind.

Here's a good article about what some of the artists make:
http://www.rollingstone.com/news/story/_/id/5938443

I found a website listing some top record contracts although it looks a bit dated:
Artist Contract Company and Date
R.E.M. $80 million Warner Bros. 8/24/96
Janet Jackson $70 million Virgin Records 1/11/96
Metallica $60 million Elektra Records 1/10/95
Barbra Streisand $60 million Columbia Records 12/13/92
Madonna $60 million Warner Bros. 4/20/92
Michael Jackson $60 million Sony Music's Epic Records 3/20/91

Remember also that Mariah Carey was paid $28M to get out of a $80M contract after her nervous breakdown.

I can't remember the source but I've heard that Eminem has a really good deal getting $2 off of every CD sold. That doesn't seem like alot unless you're going muliti platinum though.

It really just depends on the artists negotiation skills.

Fixed.

this is the best piece ive seen about this issue. really amazing and shocking stuff...

http://www.negativland.com/albini.html

Keep in mind that no one is really telling the truth when it comes to how much they earn or pay out in royalties. There's no incentive to. I can tell you that established artists make out pretty well in general, while new artists rarely break even. But it's also true that major labels lose money on about 90% of their roster. So it's unfair to look at it from the standpoint of one specific band; you have to look at each label's roster overall.

There's also complicated factors to consider such as cross-collateralization, most favored nation clauses, etc.

I'm a music copyright lawyer; I don't do royalty negotiations (besides, I'm just an associate and too inexperienced to do it anyway), but I have sat in on one or two, and I stand by my claim that there are no innocent parties.

If it's that fucking bad, why doesn't he get a job in an office or something?

Well if the artists just wanted the music to sell itself they wouldn't sign with a major label... They'd stick to indie labels or self-produce their stuff (some artists do). Artists sign to major labels because of the hope (sometimes promise) of becoming a big-name, high-selling artist.

I'm not saying I agree with payola, but the labels are in the business to make money. Plain and simple. They market the music anyway they can to get larger sales.

I know a former salesman (correct title?) from Capitol who promised a certain band that he'd get them a gold record and he did. And I doubt they would have got that gold with an indie label -- and I believe the band felt the same way.

The correct term would be "A&R rep" (Artist & Repertoire) - but you're pretty much spot on for the rest.

As for how much an artist makes, it depends on the deal they signed going in. It could be anywhere from $.50 to a couple of dollars, after they factor out evryone and everything else that needs to get paid out of it (the manager, the record label, manufacturing, promotion, tour costs etc..etc..). And if a band got a huge advance, or depending on what the "Recoupable Costs" clause in their contract says - the money the label 'loans' the band to make videos, tour, whatever...which they expect to get paid back - they may never see any of it. In these cases, it's usually only the bands on major labels that sell in excess of a million copies of a record that ever see any true profit from it. They make the rest of the money they earn off of touring and merchandise sales. But again, it's all about what kind of deal they signed.

Perhaps you should find out who Steve Albinin is before making comments like this.

All 3 of his groups have been on Touch N Go Records, a small label. He is a producer that charges a flat fee for his work instead of the usual percentage of sales, this is to ensure the best work of him and the artist without worrying about sales and "hits". His most know production is Nirvanas In Utero, but he also has produced the Pixies, Breeders, PJ Harvey and a plethora of others.

depends entirely on how much leverage the band/artist has. if you are out of contract and have the built-in audience of someone like eminem or backstreetboys then yes its possible to get as much as $2 per album. But my understanding is that you have to be quite a force in the music industry to even get $1. new bands "on the rise" frequently have to make awful deals just to get published, so ive heard as little as twenty-five cents per album is common. When an unknown band gets money up front from the record deal they can expect to get pretty much 0 revenue from subsequent album sales.


i think the 'behind the music' for some 90s band (goo goo dolls?) said they were getting something like a quarter per album from Metal Blade, and thought they would see some nice money when they went platinum, but the label surprised them with an avalanche of bills from 'promoting' the album and they actually owed the label $100,000 after a platinum album!


I think its not so much that downloading music takes away this per album pittance from the artists, its that strong album sales give the artist a lot more leverage next time around and helps them negotiate a better deal and get stronger backing/advertising from the label. poor sales simply leave them at the mercy of crummy offers.

True, but for 90% of bands this is the way to go since you're probably going to lose the label money and won't recoup anyway. Smart lawyers/agents will generally go for higher advances and up-front payments as opposed to higher royalty points down the line.

This is exactly right. Just like you can't judge on an artist-by-artist basis, you can't look at it album-by-album either. New artists have no leverage, but if you put out a gold or platinum album, you can really renegotiate a much better deal for the next one.

the royalty money is in the songwriter royalties.

even when someone remakes the song, the original writer gets a piece of the action--not the original artist (since it's the words and melody written by the songwriter that are being re-used, not an artist's performance)

found a couple good links about this...shows you just how horrible the music industry is

http://www.negativland.com/albini.html

http://futureofmusic.org/contractcrit.cfm