Odd Facts About the Music Industry
It’s broken and we need to fix it.
There’s always some nonsense going on in the music industry.
Whether it’s the latest artist drama or someone’s subpar album release.
Yet, regardless of what you think you know…it’s probably only scratching the surface of the industry’s problems.
Here are 5 surprising facts that you would usually only experience as an artist.
1. Record deals are money drains
According to calculations done by TheRoot, the average contracted recording artist makes about $23.40 for every $1000 in music sold. A typical full-length record deal is full of hidden fees and recoupment clauses.
While a band may only need its members and a studio to record an album, the label will bring in songwriters, producers, musicians, and other specialists to make sure the end product is something that they think is marketable. For a more detailed look at all the expenses (both legitimate and shady) that ultimately come out of the artist’s wallet, take a look at TheRoot’s article.
In 2008, 30 Seconds To Mars was sued for $30 million by its own label EMI/Virgin Records. The label cited a breach of contract, for failing to deliver a new record by deadline. The rock band’s frontman, actor Jared Leto, shared with The Times:
“There was a point after we had sold millions of records around the world, where not only were we never paid a single penny, but we learned that we were millions of dollars in debt.”
After this, the lawsuit was dropped and the band renegotiated its contract with EMI, releasing an album This Is War in 2009.
Courtney Love also wrote an open letter to the industry, clarifying that labels often give artists huge advances to create their album, but all those costs add up and the artist ultimately needs to pay the label back.
2. A record deal offer is unsustainable
It’s difficult for artists to secure a record deal without having some sort of insider connection or substantial starting fanbase. After all, record labels operate on luck and are only interested in artists who have done most of the work for them.
Artists without connections need to already build the audience, figure out their brand, have the exciting content and the master plan for the future. It’s almost like a startup’s relationship with a VC.
If an artist’s first release is a commercial hit, the major label is satisfied. But on the second release, when artist’s fail to attract listeners after their big break, fingers start pointing to the artist rather than the record label.
Most people underestimate the difficulty of an artist’s creative process. And together with pressure from the labels as well as pre-mature touring, this process becomes a nightmare altogether.
3. The industry’s standards are a Catch-22
While the industry likes to think that it’s creating unique personalities and sounds, it’s also biased towards what is popular. This is because what’s popular reaches a wide audience, and this creates more profit.
Labels try to create products that can appeal to everybody but this makes marketing extremely difficult and leads to one-hit-wonders with very short term success.
On the flip side, a product that is more exclusive and catered toward specific tastes is easier to market and attract loyal audiences, but it’s not what record labels want.
Once artists sign the label contract, the label is most likely going to use whatever audience and sound that brought them to the contract and exhaust the options in that niche. Take it from someone who went through the whole gauntlet and made it out.
4. Devastatingly low success rate within current label systems
One of the nation’s leading music-business consultants, Moses Avalon, calculated the probability of success on a major label.
Spoiler alert: it’s really bad.
With over 30 years of industry experience, he was able to use hard numbers to prove the near impossibility of success when signing with a major label.
In the article, Avalon calculates that the success of signing with one of the four major label distributors (Universal, Warner, Sony/BMG, and EMI) if a demo is sent to all four, is 1 in 42.
Contingent upon getting signed with the label, Avalon calculates the success rate while signed with a major label is 1 in 2149, or 0.0465%.
And if people are trying to avoid major labels for better odds, commercial success from signing with an indie label is even less likely: 1 in 477,000 which is 0.0002%. If you want to see how he calculated these numbers, the full article is here.
Once signed to a major label, Avalon says that 99% of acts signed each year never get to release their first album.
This can be the result of a variety of reasons, including label merges, acquisitions, or even closure. Artists in development during any of these processes are caught in the crossfire, and may never get to see their music released.
5. Buying the competition
Major labels will intentionally prevent an artist’s release. They do this by offering shiny record deals to artists that may potentially compete with their major artist or next big release.
These deals have no intention of releasing music, it’s simply the label’s way of outbidding their competitors to eliminate potential competition and ensure that their major artist dominates the target audience.
Imagine it’s 2004 and you’re a female singer with a voice for singing ballads by Destiny’s Child and Mariah.
Yet, you have the potential and the breadth to venture into dance music and contemporary R&B. You get scouted by a producer and before you know it, you’re getting auditions and offers from every major label… until Def Jam offers you an offer you can’t refuse, promising a wildly successful music career. So you sign.
What you don’t know is that for the past year, they’ve also been developing Rihanna, the next hit singer of the 21st century.
With your talent, you’re a threat and it was only a matter of time before you signed with one of Def Jam’s competitors.
If it means signing artists before their competition can, the major labels are more than willing to outbid their competitors. Labels give you a huge record deal without any intention of letting you record, release, or perform anything for the next few years, giving their star artists space to dominate the marketplace.
There are plenty of stories of artists learning about the ugly side of the music industry by forging through it themselves. Terra Naomi. JoJo. Prince. Brad Paisley. Taylor Swift. Kanye West. The list continues.
If you’re still curious and want to learn more about the industry, here is some further reading for you:
What are the odds of succeeding without a record deal?
Steve Albini Takes On ‘Parasitic’ Record Labels And Copyright’s ‘Outdated’ Illusion Of Control
Compiled by Alina Yen for Black One Entertainment
