Music Publishers And The 360 Deal

As everyone connected to the music business knows these days, record labels are demanding 360 deals with all of their new signings. Just in case you're not sure, a 360 deal is one where the record label owns a piece of all your income streams, including revenue from touring and merchandise.

Now you might think, "Why should I give them part of anything other than the part that they're supposedly good at - selling recorded music?", and you'd be right. It's pretty outrageous to pay anyone who can't make a real contribution to the success of a revenue stream. A 360 deal in essence gives a label the same control as a manager has, or at least the same fees, but since they're not even that good at their core business of selling music anymore, why should you give them part of something that have no experience in?

But now it turns out that major publishers want to get in on the act too, and are demanding their own 360 deals.

At one of the recent monthly Association of Independent Music Publishers (AIMP) luncheon at LA's House Of Blues, a panel of publishing business affairs execs told the audience that music publishers are now demanding additional rights that amount to major label 360 deals when signing new artists.


The reason why the major labels want (even need) 360 deals is because CD sales are in the toilet, and downloads don't make enough (and even those sales are flat) to compensate. They have to make up for the loss of income somehow, and taking additional rights from the artist is the only way (so they seem to think).

So it is with publishing. Until recently publishing escaped much of the turmoil of the music industry. Mechanical royalties (the royalty when a CD or download is purchased) have dropped, but performance royalties (when a song is played on the radio, television or in a film) have gone up as more and more television channels came on line. But now that income has dropped as well as just about every broadcast entity is paying less for music, so publishers are also trying to make up the lost income.

What's an artist to do? If the label, the publisher, the manager, and maybe an attorney have a piece of all of your income streams, there's not much left.

All the more reason for the DIY approach that's now possible in Music 3.0. That's the only way that you can put yourself in a position not to have to take a 360 deal of any kind. Any kind of success that you generate increases your bargaining power. It's no longer just another way to do it, it's now a necessity.

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Piracy And Copyrights 2010

  My buddy Richard Feldman, who's president of the American Independent Music Publishers (AIMP), a Grammy-winner producer and songwriter, and owner of Artist First publishing, wrote an interesting post on the AIMP blog the other day.

Richard takes a look at the current state of music copyright and music piracy and has some interesting numbers that can be downright scary or hopeful, depending upon your outlook for the business. Among the numbers:

• Illegal P2P trading is estimated to be close to 90 million files per year, according to the IFPI's 2009 report.

• Worldwide music sales for 2009 were $16 billion, again from the same IFPI report.

• If just 10% of illegally traded songs per year were monetized (that adds up to 9 billion songs per year), $6.75 billion additional dollars could be injected into the industry if the income from song were 75 cents.

• The technology doesn't exist to actually catch someone in the act of illegal file sharing (this was a surprise).

Digital piracy is not the only reason that the music business is in trouble these days, but if only a portion is converted to real sales, the music industry could change almost overnight. Check out Richard's post at the AIMP blog.