How the "music business" *ACTUALLY* works
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- เผยแพร่เมื่อ 10 ก.ย. 2024
- Record deals and record labels are predatory, the music industry isn't fair - most artists are aware...
...but just how much are record labels cheating artists? How does the music business actually work?
In this video, Circa breaks down exactly what kind of "business" a record label is and how they make money. You may be surprised at just how stupid this industry actually is!
What we do: indepreneur.io/
#musicbusines #recorddeal #musiccareer
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Check out: "How Indie Artists are getting PAID to Grow their Fan Base"
• How Indie Artists are ...
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It does sound insane that people would agree to a record deals in today's world. I like your message - Stay Indie!
No record label tryna hire ur broke a$$
well, apart from that labels own the rights to your masters is not necessarily that bad of a deal when taking everything they offer in to account
@@schleppvideos
Sure….
if you ignore *everything* that was just said in the video.
Record labels should be failing left and right
@@vincentkingsdale8334”should”, is the word, but there is a reason why they aren’t.
I always had a theory (before the internet) that virtually all artists who became famous were naive about finances; they just signed the dotted line. From there the record label, merchandisers, publishing companies, etc. just took complete advantage of them and raked in the cash while the artist was working their butt off, oblivious at how much money they were actually making for others rather than themselves.
nailed it
Yes this is why record labels like to go for young artists. They are easier to take advantage of due to lack of experience and can be milked for a longer time
Master rights shouldn't be owned by labels anymore IF the artists are delivering the masters themselves without the label's help. Or at very least, there should be reversion clauses. So much of the music business-- mechanicals, work for hire, breakage, etc-- is antiquated and fossilized from many eras ago and they just retrofit the newer technologies to benefit the labels.
My mans broke out the "breakage" clause - now that's some deep contract law f***ery right there!
Whoa.. Two of my worlds collided here lol. Dope to see you guys interacting with each other. Cheers I learn tons from both of y’all. Just watched a Pain video yesterday even though it’s more parallel knowledge then directly related to what I do .Very intriguing. IndiePRO is where I’m learning advertising Pain plus tons of other stuff.
@@gimmicklessentertainment 🙏🏽🙏🏽
@@musicmarketing thanks for the video just to add on , the record business is a mafia style of business , labels use some business practices that the mob use in the underworld
It’s such a slap in the face to the artist.
This is exactly why understanding contracts is crucial for artists! Excited to learn how record labels operate from Circa's perspective.
Amazing break down. I think part of the problem is that a majority of artists would see 15k as a TON of money. In some cases, maybe as much as they'd earn in a year in whatever day job they have. A big moment came for me years ago when a mentor managed to re-configure my brain to see potential - what was actually possible. Once you see what's possible, and once you actually get experiences that back up that belief with hard data, you are on your way.
I think the venn diagram of "artists who think 15k is an unimaginable sum" and "artists at danger of signing a record deal" has minimal overlap
@@musicmarketing I'll take your word for it! I guess what you're saying is that if you're in the position to get an offer, you've already mastered some business concepts and have had to manage/pay for tours, merch, etc etc. To my mind, that makes saying "yes" to such terrible deals even more perplexing.
When I was in a band (and this is going back a bit :)) we had a limited mindset and would have jumped at a lot of bad offers because of it. Now, I'm nearly 20 years into a film/tv scoring career and I see a similar thing in folks starting out - their eyes bulge at the prospect of getting paid to make music at all, and their ideas of what is sustainable is not configured properly, let's say. I spend a lot of time getting people used to quoting numbers that they think are astronomical, but when broken down, are actually reasonable and fair.
Great video. I wonder how much getting signed isn't about the money (or totally about the money) and more about validation. Being 'picked'. Helping validate you as an artist to yourself and others. "I'm signed to xxx" still gives a veneer of legitimacy. It's amazing what people will give away to shut up the inner critic for a while....
Recording artists should carefully review several key clauses in their recording contracts to ensure they are getting a fair deal. Here are some of the most important ones:
1. **Royalty Rates:** This defines how much the artist will get paid for sales and streams. Artists should understand how their royalties are calculated and what percentage they will receive.
2. **Advances:** An advance is money paid upfront to the artist but it's recoupable against future royalties. It's important to understand the terms of recoupment and what expenses are recoupable.
3. **Ownership and Copyright:** Who owns the master recordings and the songs themselves? This determines control and future income from the music.
4. **Term and Territory:** The length of the contract and the geographical area it covers are crucial. Artists should be wary of deals that are too long or too broad.
5. **Creative Control:** Artists should look for clauses that outline who has the final say in creative decisions, such as song selection, album artwork, and production.
6. **Publishing Rights:** If the artist writes their own music, the contract should clearly state who controls the publishing rights and what the split of publishing royalties will be.
7. **Breakage:** A traditional clause that can deduct a percentage of royalties to cover the cost of damaged physical products. It should not apply in the digital age.
8. **360 Deals:** These contracts involve the label in all aspects of the artist's income, including touring and merchandise. Artists should ensure the terms are fair and not overly restrictive.
9. **Distribution Rights:** Understand how the music will be distributed and what rights the label has, including exclusivity.
10. **Option Clauses:** Labels often have the option to extend a contract for additional albums. Artists should be clear on how and when these options can be exercised.
11. **Delivery and Acceptance:** Terms that define what constitutes a completed album and what happens if the label doesn't accept your work.
Artists should consult with an entertainment attorney who can provide advice tailored to their specific situation and help negotiate the best terms possible.
Your comment deserves the pin of usefulness!
from my experience in 2022: even signing up to indie labels leads into that same pitfall. You should rather say "stay 360". Founding a label is done in a few hours.... keep your royalties at home.
😎
"Stay 360" no because there is a deal called 360, and it's not a good one therefore saying "stay 360" would be confusing.
These deals are so evil. The labels take advantage of the artist's immediate needs because most creative people don't have money.
And who owns all these record labels? I'd give u a hint but i'd be banned...wonder why are they the only ones that cant be criticizes? hmm
@@Alien_Cutsbankers? Aka the people who print money...
@@Alien_Cutsblackrock or vanguard
And the sad part about this is if we do strike like producers and songwriters about not getting their fair share, they’ll just outsource production in another country. Hey, $15K, we can blow by in America in 6 months, $15K for a dancehall producer in Jamaica or hip hop producer in Cambodia can live comfy for a year off of that. Both parties win! The American creators starve.
The new TLC doc and another one on 90's indie rock bands whose name escapes me both explain in no uncertain terms how record labels are simply in the business of financial slavery. Thanks for breaking it down for the layman. Now Universal just repackages vinyl so they can keep making money from music that they still own, hogging up the vinyl market making it that much more difficult for newer acts to get their music out in physical form. With avenues like Bandcamp, at least bands are making the majority of profits as compared to the (hopefully dying) record label model.
...you basically just described a Shark Tank deal with Mr. Wonderful, but with music.
Well laid out. I'm amazed at how many people don't get this and think that being "signed" to a record label is the be all end all. Like you, I have seen and know of many "famous" artists that have been royally F'd by both management and record label's.
Allright, this model of being honest is WORKING my friend. You are putting fire out video after video 🧙♂
aww man thanks so much Duncan Trussels brother
@@musicmarketing Duncan master of trippings ahahah cheers man, support from Italy!! 🧙♂
Absolutely AMAZING video. Very informative, honest, well-researched, and incredibly useful. EVERY new or emerging artist on this planet needs to see this video, and take notes.
I appreciate you for saying so!
@@musicmarketing What do you say to the guy who says "It takes money to make money, and I'm currently broke"? What are his options?
@Onabi Beats it takes a product/service and sales to make money.
@@musicmarketing hoi i was wondering if i can interview u on my show i speak about the same thing
Too many emerging or aspiring artists are fame obsessed and it blinds them. The vision of being next Adele, Bieber or whoever else is so strong that they can not help and sign ANY contract they are proposed, thinking that "ohh if a major label gives me a contract this means i am a chosen one...a special one". They treat it as validation of their artistry. It's sad but that is a majority of cases. Another thing is a lack of common knowledge about the industry from a business perspective and what are the rules of that "game". It requires an extra drive / push to influence someone to go check on this topic, to deep dive into it ...
hello! i was dying laughing at the brief clip of the giant dog sniffing around the smaller one. i was just like “oh no!” 😂
Adding this to my all time fav "Circ rails against the music industry" videos. This was such a good explanation and I always wondered exactly how all of this could be sustainable and make sense. Now I know, it's ridiculously cheap capital ! Holy shit
This is also true with indie labels in, for example, electronic music who don't even offer advances but still pull a bunch of dirty tricks while giving you almost no value and funnelling all of your fans into their brand. It's insane that people still put up with this shit.
I always welcome a good ol'-fashioned rant from Circa bashing the industry!! 🔥
Love a good Circa rant on the industry!
My suspicion is that the labels with clout are shutting out the independents, or at least are trying to, especially with Streaming and editorial placements. That’s a hurdle many would like tips on I’m sure!
I'd be surprised if an editorial placement had a real value above $1000
@@musicmarketing I mean article editorial, not Spotify. Getting legitimacy in traditional media still carries weight in some genres but yes, it only really amounts to street cred.
Wow Circa! You never cease to amaze me. This video is golden. Thank you. I’ve always felt this way and this was the final confirmation. Give thanks! Love you and all the fam here at Indieprenuer! 🙏🏽✨💚🎶
Specially the streaming services, at the end you have to split 0.004 cents between all members. I'll say that is better to not give rights to those platforms and only be able to download music from official group website.
Your TH-cam channel is gonna get big bro you are so entertaining. I laughed so hard when you said good job dude😂
Great job breaking that down!!
Legendary busy works beats
The conflict is a lot of artists love the record label’s pr machine. They want to seem “big”. The illusion, which may never happen. If they can use the “name” to diversify & get into other stuff, cool. So yup, the labels will keep repeating the same old tricks
Another gem here! Good framework of the label scheme, reenforcing the indie route once again. S/o to the editor too 😏👌🏼🥂
Brett! Thanks much man and I'll let the editor know his work is appreciated haha
Yup.... Circa preachin always gets me pumped! 🔥🤘
Droppin the killer info as always. Thanks Circa et al.
Man this is soooooo true. thanks for putting it out there.
Very clear and makes total sense. The final piece that has convinced me to consider bypassing the whole thing. However, now we know what not to do, what do we actually do? Especially when we need funding and resources / abilities we don't have to move ahead? Considering the fact that releasing music, even if it's already done, is a waste of time without a PR campaign / promotion funding and it's impossible to tour without spending a ton of money.
Ya. When we started out as a band we looking into this sort of stuff from the start.
We decided to self-produce from the start. None of us knew how but we built a studio and 3 years later the productions are pretty decent.
It will only get better with time, practice, and patience.
Chasing a record deal is exactly like chasing investors. It's a waste of time. Just start small and grow your business with the budget you have.
Lord!! Insane! “Just bend right over, and it’s gonna hurt really bad, but you are signed!”That’s what I just understood from this video!! Well explained🎉❤
GOD, I HATE RECORD LABELS!!
Ownership is everything. Good to see you doing well. -oldskool
If those deals with labels work that way, I don´t understand why now days any artist is agreeing to that. I guess they are just scammed.
Recording an album with total professional sound cost between 1000€ and 3000€ right now with how easy is to access a studio.
If I sign any deal is because I am expecting the label to do some promotion work that I don´t know how to do so I can just focus on the music. If the deal is just money, I would take a bank loan or just save until I have enough for whatever I need as an artist.
the thing is they don't actually do good promotion work - it's either overpriced or ineffective
it's simple to actually earn something in the music business, create music on a topic that is viral, try to spam create music on that topic about 30+ music, I tried it, and nothing to do with a record label, thanks for the informed everyone who newbie in this field, you safe many life from modern slavery!
That’s what is called “Smart” business model and strategy. There’re legal issues attached to it. It’s a risk. A kind of 50/50 scenario. They always win.
OMG. All this time I thought what a bad business model the old music industry was, throwing spaghetti at a wall and hoping it sticks when they try to break new artists, but I did not know about the arbitrage model. Knowing that, it starts to make a little more sense what their game is. Thanks for this awesome info.
Circa ! You’re a real one, thank you for breaking this down in a creative way! Need more people like you 🙏🏿
Circa just dropping more 🔥.... Record labels being an Arbitrage business is such an accurate description!
I appreciate you, brother! Thank you
Bet the record industry loves you.
You keep this up, and the record companies are going to start trying to pay you to stay quiet
This was really eye opening and i actually understood it! Thanks for this dude
Very clear and easy to understand. Thanks !
Keep fighting the good fight Circa! Love you dude
I will!
I have sent this to multiple folks! This is a great explanation of this concept. Thanks Circa
So many ways for artists to get support from their fan base directly today. Skipping record labels is a must
Solid video; nailed it;
Would love to hear your thoughts on the politics behind the curtains of record labels and artists once they DO GET SIGNED...
name a topic I'd be happy to make a video about it
@@musicmarketing Expect an email this week ;)
Done!
BEST VIDEO EVER! OMG! This is explain a lots of things. Thanks!
Wendy Day recommended this video and wow...This is a MUST WATCH!! Thank you for this information man
This is explained very well here. Thank you for this fantastic video!
Fact is you don't need record companies as much as distribution, selling tickets, promotion are things a manager and asst can handle.
great video. keep up the good work, and stay indie for sure.
Very informative. Keep posting videos Circa I love the content!
Yep. And goddammit. And yep. I love your thoroughness and underlying geekdom about every aspect of this game. You're like me 2.0!
The sad true is they don t "give" you only the money they have also the contacts..in the media industry..and this is where they base their strength..It s not that easy to entry in TV or big concerts on your own unless you are Radiohead or someone of the same calibre
Great content sir, thank you for speaking the truth to those who actually want to hear the HONEST truth lol.
*wish more artists in the industry were educated just as you.*
SUPER gems, thanks so much for your content. Love the no BS approach lately
Thank you for this video. Changes goals.
it's insane. toured for like 5 years and headliners that should have been netting easily 25k a show were taking home 3 figures per night.
This is a great video, you should keep making these great videos!
That's the plan!
It’s never been about music. I know a girl that just got a 4 million dollar deal who has never written an original song because she makes cute TikToks.
Interesting, and I am sure book publishing works at least somewhat the same way. I am involved in both business - music as a songwriter and publishing as a fiction writer. No wonder I feel whammied, all the time. And, now, double whammied because I have taken up song writing. My first effort to go to demo: _Summer is for Fun._ In a few short and seemingly innocuous words, it exposes the idiocy of the surfer wannabe culture of the past and present. Real surfers are athletes in a challenging and dangerous sport. I wouldn't do it but those who do deserve their credit. And the chord progression - sublime for a rookie. V-IV-V-I / V-IV-iii-ii / V-IV-V-I.
See, it's an A-B-A pattern and it has to go back to the chorus to resolve. I hope I'm not giving too much away.
Great Vid bro, thanks for sharing!
The EDM scene is not like this. But there are no advances and records don't earn much.
Masterfully put together video if you understand finance and branding
Great job Circa! 🎉
Excellent advice. Stay Independent. Who wants to be a slave to the Music Industry and end up not even owning the rights to their songs? Greed should not be allowed in any business.
but what about big tv placements and award shows/performances? have you seen indie artists having access to that at some point? (genuinely asking)
Thanks man!! Great info!!
Good video, dude. Good info..
Thank you king 👑 great video
BRO!!! Fuck yeah dude! Preach!!! You are awesome and I wish we knew each other so we could go grab a drink and talk man. You seem like a super coold dude. Really appreciate this message. Humor was spot on too. Liked & Subscribed!
Very eye-opening. Thank you for uploading this.
I also subscribed to your channel.
Fantastic vid - thanks for explaining everything so clearly 👊
I'm still surprised it actually worked, that people would actually be o.k. taking on a debt, signing away everything they make in the process, and take only 20ish % of any future earnings. I'm surprised it's legal. I'm not in any way surprised though that the music industry works like this as I've heard this all before.
THEN you make it- make the money back then they take years to pay you or "do accounting" stay indie bb
My experience with musicians is they are not the brightest bulb on the Christmas tree when it comes to business, spirituality, and politics.
Interesting video, however the main issue with staying independent is the funding it takes to get traction in this industry. While I agree that staying independent makes sense, however how can one fund their music enough to starting earning enough income
to live off your music career?
Every musician I know who has done it simply invested excess capital from their existing job to do so. Pretty straightforward to be honest!
Same as any small business. You must do it yourself. Take out loans, credit cards, savings, etc.
beautiful high value offer, wish everyone would watch it
Hey man, Weaver beats' saracastic commentary sent me. Subbed cause youre taking no prisoners, do American politics next pls
@@TheMattSwifts wot
Amazing man, thanks for this today! :)
Gene Simmons from KISS told Van Halen to lawyer up if they want to get paid in a record contract. They did and the rest is history. Van Halen got 50% of all shows and record sales. It pays to know the business. If you don`t know, you will get screwed! Bands must demand a 50/50 deal before signing anything and they must have a lawyer present in the room who has read the contract and given his advice before signing. That is how you get paid for your music. PERIOD! If the label refuses, go elsewhere.
Loving these so much
Thank u bro 😂 really helped me for my life in the most calmest way 🔥im definitely subscribing 💯🙌🏽
Great information and perfect delivery, thank you!
You’re awesome thank you for breaking it down like this. A lot of times these record deals are so appealing because they seem to offer signing up for a team that can help support you to finding and maintaining an audience + all the administrative stuff that comes along with being an artist. Is the only alternative that an artist does all this themselves?
Absolutely amazing video 👏👏
Please do a video on radio promoters! I got screwed by one several years ago.
Thanks. That was beautifully structured.
It honestly sounds like a reasonable business model. It’s just artists that don’t understand finance who get gouged.
The problem is record labels only want to pour a lot of marketing money into a handful of artists at a time. There are not enough resources to go around so hundreds of artists at a record label are all fighting for the same marketing dollars. It actually isn’t sustainable at all. The artists that get popular are not necessarily the most talented they just have the most marketing on their music
Very interesting perspective. Love the content.
Songwriters! If your songs are good enough for recording companies to want them, just put a value on your song and Sell it to them for what you think is fair period!
Yep.
They dont even have the money they loan out? I'm both surprised and not surprised at the same time. Record labels are disgusting and useless.
And THIS is why Tom Macdonald is 100% independent AND wealthy.🎉
H.O.G Fam. ❤
There is also a secondary business involved in the music business. And which the customer is the musician although it appears that the customer is the listener. For example, There are a number of businesses which sell access to listeners to musicians, with the idea that the musician will then make enough money from the listeners in order to pay for the services of the business which gives them access. Except that statistically will never happen. And then there are the businesses that sell marked up music making equipment to musicians with the idea of the musicians can then use those pieces of equipment to make music which people will buy, which statistically they won't. And so in reality the musician is the customer and they are being sold hope.
Check out the documentary by 30 SECONDS YO MARS called “ARTIFACT”. They cover much of this type of stuff they’ve gone thru with their label.
Bro u broke that shit down so easy 4 a idiot like me 2 understand i applaud you man
Feels like it's a better deal to get a consumer loan from a bank and finance the whole process on your own lol