Tuesday, August 2, 2011

The Big Money Artists Won't See

If you're signed to a major label you already know how hard it is to get paid, and how much harder it is to get what you're owed. It's in the DNA of labels to find every reason not to pay you, but I bet you thought you'd get a nice payday when you heard that Apple paid the majors a $150 million license fee for iCloud or then Spotify also made a large deal as well.

Here's the sad truth. Record labels only pay royalties on sales. A blanket license deal like Apple and Spotify just paid is not seen as a sale, so all of that money goes to the bottom line of the label, and none towards the artists.

How about the extra money generated by the yearly subscription fee to iCloud? Not a sale, so no royalties. How about from the Amazon and Google cloud services? They never signed a license agreement and paid any money in the first place, so no royalties.

Still want to sign with (or be signed to) a major label?
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