Disclaimer: While many of the points we make in this article are publicly-known common occurrences, not every single artist who's dealt with the music industry has had these same exact experiences.
We do not claim that the nefarious antics of some music industry participants represent the music industry as a whole. Use the information in this article to do your own research and come to your own conclusions.
The music industry is often thought of as a glamorous, creative field where talented artists are able to share their music with the world and make a living doing what they love.
While this is certainly true for a select few musicians, the reality of how the music industry works is far less romantic for most artists. Behind the scenes, there is a complex network of contracts, negotiations, and business deals that can be difficult for artists to navigate, especially when they are just starting out.
One of the most important things to understand about the music industry is that it is primarily driven by profit. Record labels, music publishers, and other industry players are in the business of making money, and they will often prioritize financial considerations over the artistic vision of the musicians they represent - not that they don't care about their artistic visions.
This can lead to a number of exploitative practices that can be harmful to artists.
While one may be quick to judge these antics (not that we agree with them), imagine... imagine what lengths you'd go to in order to protect your brittle and only home in a hurricane?
What would you do in that situation?
A 360 deal is a type of contract in which a record label takes a percentage of an artist's earnings from all sources of revenue, including concerts, merchandise sales, and sponsorships. While this might seem like a good deal for the label, it can be detrimental to the artist, who may have to give up a significant portion of their income in order to get a record deal.
This exact percentage will vary per situation but this is important for artists to note.
Songwriters and producers are often entitled to a portion of the profits generated by the sale of a song or album, but tracking these royalties can be difficult, especially when the music is sold or streamed online.
As a result, many artists and industry professionals have reported not receiving their fair share of royalties.
Music is sold/streamed through a variety of channels, making it difficult to accurately track how much money a particular song or album is generating. There have been numerous reports of artists and industry professionals not receiving their fair share of royalties. This can be due to a number of factors, including mismanagement of funds, fraud, or simple errors in the tracking process, or even record labels (or other industry players) deliberately withholding royalties in order to maximize their own profits.
Some creatives have advocated for better tracking systems and more robust reporting procedures, while others have called for more stringent regulations to ensure that artists receive their fair share of royalties.
There are also a number of less well-known practices that can be harmful to artists. For example, some record labels have been known to pressure artists into signing away the rights to their music, without fully disclosing the full impact that has on their gross career. In these cases, the artist may receive an upfront payment for their work, but they will have no control over how their music is used or how much money it generates in the future - usually unbeknownst to them.
This can be especially problematic for songwriters, who may see their work being used in advertisements or movies without their consent or proper compensation.
The music industry is known for its rampant use of "standard" contracts, which are essentially one-size-fits-all agreements that are presented to artists without much negotiation. These contracts can be heavily tilted in favor of the record label and may include clauses that allow the label to retain ownership of an artist's work or control how it is marketed.
The beliefs, views, and contents of this video do not represent the views of Blue Road Music. This insertion of this video is intended for contextual purposes only. We believe it is more important to be accountable for your own music career by structuring it in a way that fits your preferences, as every situation is unique. Do your due diligence and do your own further research in order to come to your own conclusions.
In addition to the business practices discussed in the previous sections, the music industry is also known for its politics and the ways in which it can be a "walled garden" for certain artists.
One aspect of the politics of the music industry is the pressure that artists may feel to compromise their artistic & moral integrity in order to achieve success. Many musicians have reported feeling pressure to conform to certain styles, beliefs, and trends (behind closed doors) in order to appeal to a wider audience or to meet the expectations of their record labels.
These sacrifices can pile up and have resulted in completely undesired lifestyles for some artists, regardless of their wealth and fame.
Be aware of the extent (if any) your artistic and/or moral integrity is sacrificed in negotiating deals. This could mean having deep, and meaningful conversations with the label about artistic and “big-picture” visions upfront.
Some executives never disclose their true agenda to the artist upfront - which is usually (not always) something along the lines of using the artist's ability to influence the masses through music & art, to build brand reputation, profit, and inspire the world.
Instead of being transparent about their true agenda with artists up front, they usually butter them up by telling them "you're super special", "you're gonna take over the world", etc. as a “decoy agenda” to distract them from how small they actually are in the bigger scheme. This way, the artist is constantly emotionally motivated and inspired to do the work that makes the profits.
But it goes both ways...
As an artist, it's good practice to be proactive in clarifying visions with any and all partners before agreeing to any terms.
Despite these issues, the music industry is still an incredibly competitive field, and many musicians are willing to accept less-than-ideal terms in order to get their music heard. However, it is important for artists to be aware of these practices and to protect their interests as much as possible.
There are a number of organizations that can help musicians navigate the complexities of the industry, such as the American Society of Composers, Authors, and Publishers (ASCAP) and the Recording Academy's GRAMMYs on the Hill.
Additionally, there are a growing number of independent labels and artist collectives that are looking to create a more equitable and transparent industry.
It's important to remember that the music industry is constantly evolving, and what works for one artist may not work for another. The most important thing is to find a balance that works for you and your career and to be aware of the potential pitfalls and challenges that may come along the way.
While this article has focused on some of the ways in which the music industry can be exploitative towards artists, it's important to note that there are also circumstances in which major record labels can be beneficial.
One of the primary advantages of signing with a major label is the access to resources and support that these companies can provide.
Major labels typically have much larger budgets and infrastructure than independent labels, which can be especially beneficial for artists who are just starting out and may not have the resources to fund their own music releases or tours.
In addition to providing financial support, major labels can also offer a range of other resources, such as marketing and promotion, and access to industry networks and relationships. These resources can be especially valuable for artists who are looking to reach a wider audience and build their careers.
Another potential benefit of signing with a major label is the opportunity to work with experienced professionals who can help guide an artist's career.
Major labels often have teams of executives and A&R representatives who can provide valuable feedback and direction to artists. While it's important for artists to maintain control over their own careers, working with professionals who have a wealth of industry experience can be beneficial.
It's important to note that signing with a major label is not the right choice for every artist, and it's ultimately up to each individual to decide what is best for their career.
However, for some musicians, the resources and support provided by a major label can be invaluable in helping them achieve success.
The information provided in this communication is not financial advice and should not be treated as such. It is for informational purposes only and is not intended to be a recommendation or solicitation to buy or sell any securities or other financial instruments. You should do your own research and seek professional financial advice before making any investment decisions. Please consult a professional for specific advice. None of the information provided should be construed as legal advice.