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Finances of a record deal - article by Steve Albini

Discussion in 'Miscellaneous [BG]' started by submelodic, Sep 2, 2002.

  1. submelodic


    Feb 7, 2002
    Seattle, WA
  2. Brad Barker

    Brad Barker

    Apr 13, 2001
    berkeley, ca
    seems like albini took some shots at butch vig! i read that steve doesn't really like butch all that much (said steve: "'nevermind' [produced by butch vig] in no way represents nirvana as the band that i worked with").

    what's confusing is that the $3million band x's cd grossed was listed as an expense. in the math, it apparently was a non-factor. the band wouldn't see ANY money from a cd it sells? that's hard to believe. i think that (miniscule) amount of money would at least be enough to make them not indebted....

    but all in all, that's fairly accurate! i saw TLC's behind the music!
  3. Fuzzbass

    Fuzzbass P5 with overdrive Gold Supporting Member

    Excellent article, I've had it bookmarked for awhile and post the link every time someone says that a band must be wealthy if they've been signed to a deal.

    I remember when a local band got signed to a seven album deal on a big label. The editor of the local music mag exclaimed "Fantastic news, I'm so happy for these guys!" Obviously she didn't realize that a seven album deal is NOT good news for the band, it is good news for the label. Chrysalis was not obligated to release 7 albums by this band. Instead, the band was locked into the same crappy terms for seven albums... should they have the good fortune to be popular that long. The first album didn't sell well, so the label said "sorry, you get no more money for promo or studio". The band could not move to another label because the first label owned their a$$.

    The band, who were extremely popular locally, broke up. Four of the five members started a new band, but *they* had to break up, because the label said "sorry, this is essentially the same band... changing your name doesn't get you out of that crappy contract you signed because you were desperate".

    Two ways to avoid getting screwed:
    1) Be independently wealthy (and have a good lawyer)
    2) Be courted by more than one label (and have a good lawyer)
  4. cap


    Aug 8, 2001
    Hickam Hawaii
    So...exactly how do artists afford what we see on mtv *gross* cribs *cring*? I'm not saying the article is wrong or anything, i'm in no position to say otherwise. But bands that have been around forever like Aerosmith...they must have made money enought to live right?

  5. Brad Barker

    Brad Barker

    Apr 13, 2001
    berkeley, ca
    they must have been extremely involved and meticulous and cautious when they were signing their contracts.

    it is possible to avoid being exploited, but it is oftentimes difficult. especially if the ones signing are somewhat naive.

    from what i gathered, one of the ways that helps to ensure not being ****ed over is to establish your band as a partnership. that way, the label won't have total domination over you.

    can anyone back-up/correct that statement?
  6. That's an excellent article, I might just show it to my guitarist to shatter some of his romantic illusions about the record industry.....he'd never be the same again ;).
  7. thrash_jazz


    Jan 11, 2002
    Ottawa, Ontario, Canada
    Artist: JAF Basses, Circle K Strings
    I would assume that the record label pays for that stuff. As for bands like Aerosmith, they probably are fairly well off as far as money goes. IME most bands make FAR more money from tours than they do from record sales.
  8. They don't.

    There was a recent New York Times article on personal accountants of musicians; evidently, they fight an uphill battle. I recall one saying, "I told him [a recently successful rapper] that maybe he should go to the Lexus dealer instead of the Mercedes one, but he just had to have the Benz." Remember MC Hammer? He was successful, yes, but not successful enough to afford a $12 million house.

    Many successful rappers and rockers come from lower-class households and can't imagine making so much as $50,000 in a year, so when they get a lump sum of $200,000 from a record deal, they get the notion in their head that their annual earnings are now $200,000--or more. Furthermore, the images of conspicuous consumption found in most rap videos (and, similarly, in '80s hair-metal videos) create a "keeping up with the Joneses" mentality. Cribs doesn't help this much, either. While a record mogul like Jermaine Dupri or Master P might be able to afford his bling-bling palace, one wonders about those performers whose contributions to popular culture might only amount to one or two top-20 hits.

    The performers that don't wind up with money troubles are those that are smart about it from day one: they don't buy $500,000 houses if they know they'll be on tour 10 months a year, they get $30,000 cars instead of $60,000 ones, they don't buy 10 cases of Cristal for every party they throw, and most importantly, they don't acquire cocaine or heroin habits. They also retain good lawyers and better accountants.
  9. Ah, Mr.Albini... the "Legendary Virgin". Very good article. And to quote one of his songs:
    "It comes as no surprise you're taken by surprise".

  10. fadlan bassman

    fadlan bassman

    Oct 23, 2001
    Very interesting article, makes you just want to stay a garage band.
  11. IIRC Peter that Mercedes-Lexus quote came from LL Cool J.

    As for the major record label deal... ugh.

    Unless you are lucky like Beck, who was allowed some creative room... go indie or tour.

    In Spain most bands now look to the indies Elefant, Bip Records or Subterfuge, since majors are lame and abusive... plus they now only want Ricky Martins and Paulina Rubios.

    What's scary is this record label deal $*** has been going on for DECADES. VH1 Behind The Music... EVERY episode there's something about how the artists got (bleeeeep) by labels: TLC, Bay City Rollers, Leif Garrett, John Mellencamp... or by sleazy middlemen (Billy Joel's case)...

    The saddest thing is that in this scenario only people with resources (ie: da money) could go around the system to have their music heard. The poor, once again, get (bleeeeeep)
  12. BWB

    BWB Supporting Member

    Aug 30, 2000
    Knoxville TN
    I've had several friends and good acquaintances
    that have been signed by major labels over the
    years. Two of their experiences:

    Band "A", signed by Rykodisc. Solid club touring
    act, playing clubs in cities all over the east coast.
    Standard "7 album" deal. First CD released sells
    30K copies. Rykodisc decides they don't want to
    invest any more promo time and money on them...
    and also refuses to release them from their contract.
    Band records 2nd album, continues to
    tour, can't release new album. 2 years pass.
    Lawsuit by band against record co...another year.
    Rykodisc agrees to drop the band from their
    contract in exchange for band dropping the
    lawsuit. Band momentum gone...breaks up not
    long afterward

    Band "B", similar scenario, this time A&M records.
    A&M refuses to release their first album that the
    band had self-recorded and sold 10K copies of
    out of their truck on tour. Of course, arguably
    the band's best current material is on that album!
    Records "first" A&M album with the "other" stuff
    they have. Second album is a live album, both
    sell in the 10K range, no promo $ from A&M,
    band is dropped. Lead singer was a pretty good
    friend - his take from the pie? Zero. Never saw
    one penny - like they'd never even been signed,
    except the CD was available through the catalog.

    Signed means nothing - think about your city
    where you live. Think about bands you know there
    that beat the crap out of bands on major labels.
    Hint: it's that way EVERYWHERE.
  13. Kronos


    Dec 28, 2005
    Philadelphia, PA
    Sorry to dig up this ancient thread.

    I read this article for the first time today, and it was quite worrisome.

    As a bassist who plays metal as his main music, and has gotten some nice reviews by people, naturally my mind has been onward and upward with our status.

    We're going in to record a 5 song EP (which is basically 3 new songs and 2 songs off of our free demo) which we'll be selling cheap. We've got a pretty darned good studio and engineer (working out of his house, but damn, he's good!) who's willing to work with us.

    So, we've been thinking about shopping our EP to record labels to see if we could possibly get signed. Granted, we're not looking major label. We're looking maybe Nuclear Blast, or Relapse. But, after reading that article, I'm not sure what I want to do anymore. Sure, I'd like to be the one with a music video, a decent tour bus, and a lot of fans, but after reading this it makes me feel like it's just a pipe dream.

    So, long story short, does anyone here have any answers to this problem? It makes me not want to play anymore. Not so much for the money, but because if your record doesn't sell as much, there's many factors that go into it, promotion, the taste of the people in the areas that it's being promoted (I don't see a big metal following in areas like Biloxi MI, for example), and the actual marketability of the band- to name a few.

    There's only been one person to really buck the system as far as I know, and that was Neil Young. But, that's because records sell.

    On the flipside, there's one band that was huge that had a record label destroy them that I can think of, and that's Talking Heads.

    So, anyone on here that's made it as a member of a band, what are the steps a band can take to insure against having this happen?
  14. Against Will

    Against Will Supporting Member

    Dec 10, 2003
    Big Sound Central
    Medium-sized indies are generally a good idea. The longer they've been around the better. Most indies that have been around for 10-15 years have developed a method to make money, pay their bands and also remain stable for the future. You won't make a whole lot of money, and you might have to put hope in a tour bus on hold, but you get creative freedom, no/little financial mucking about, and stability.

    There are a few cases of indies that start acting like Majors and end up getting into trouble, such as with Lookout, or most famously, Factory. However, there are plenty of other labels out there that know exactly what their capacity is.
  15. He's got us in a nutshell.
  16. Kronos


    Dec 28, 2005
    Philadelphia, PA
    One thing I did not see addressed here is the idea of being endorsed. Usually, if a band gets signed to a major label, they get endorsed by equipment makers. Granted, the legendary Ed Roman had a rant about being endorsed and the hazards that it includes, but with the spreadsheet that Mr. Albini has, it doesn't take that into consideration.
  17. With the numbers quoted in the article, that would make about $14k difference (assuming every member of the band got an endorsement). I don't think it would be wise to bet on any of that though:meh:

    I think you're probably thinking on the right lines aiming for Relapse; I'm not sure how well you guys would fit with their roster, though... you're a bit listenable;) That said, they are one of the biggest metal labels around, so there will be a lot of competition. But hey, you knew that already:)
  18. Bard2dbone


    Aug 4, 2002
    Arlington TX
    Stay free. Seriously. Incorporate the band as an 'S' Corporation and run it like a business. Record your CD's on your own. Sell 'em from the stage between sets. Get a website. Sell 'em there, too.

    Don't let a major label buy your soul, because they'll pay for it with the money that is already in your pocket.

    I spoke a couple of years back with Janis Ian (Look her up. She's awesome.) She has been a successful songwriter and recording artist for thirty-five or more years, with major sales, number one hits, and grammy awards. She said that, according to the royalty statements from her old labels' accountants, her first album with major hits on it in the late 1960's allegedly has yet to show a profit.

    She said that using the same math that label accountants use, you can prove that the movie Titanic hasn't broken even yet.

    Don't trust a major label.
  19. Skeletomania


    Oct 25, 2005
    hong kong
    You can always sell your music through i-tunes.
  20. Philbiker

    Philbiker Pat's the best!

    Dec 28, 2000
    Northern Virginia, USA
    Give up on your ambition to have music be a career. It's a great hobby, just enjoy it and do it for the fun of it. There's nothing wrong with that. It's a deplorable business. You're better off working at 7-Eleven and playing the lottery.

    Or if you really want to make money in the music business, get in a Wedding band or cruise lines.

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