How Much Do Record Labels Pay Artists?

Is it profitable for an artist to collaborate with a label? Will this interaction give the results that the artist expects from him? These questions have always worried the music industry, but each artist answered them independently. So, one of the most important points of this collaboration is the distribution of profits between the label and the musician. Of course, there are no standard figures and proportions, each contract is unique. But general trends can still be traced.

So, whether or not to partner with a label is one of the busiest disputes in the digital age that has to do with copyright and content distribution in the music industry. The biggest argument of major record companies is supposedly protection of the creators.

However, the current remuneration model employed by record companies among artists is far from expressing a genuine interest in benefiting creators, but instead confirms the commercial gluttony that has characterized them historically, which in some way serves to justify, or at least understand, why Millions of people around the world have stopped buying music and are choosing to dedicate themselves solely to downloading or sharing music for free.

Did you know that your band can sell a million copies and still owe the record company money?

A record production contract is an employment agreement between an artist or musician and a company (music producer or label) in which they agree to produce and royalty music in exchange for an assignment of reproduction, communication, and distribution rights.

Try it free

The first thing you need to do is figure out where and how you can send your music. Usually music labels have a web page that has a section for contacting and/or submitting demos. In this section, you will find an email or form through which you can submit your topic.

For example, the Swedish music streaming service Spotify pays record companies about 70% of its revenue in paid rights, which equates to a per-artist average ranging from $0.006 to $0.0084 for each stream of its single. If the label’s contract with the artist implies that each party to the agreement receives 50% of the profits, then the artist will receive a maximum of $ 2940 for each million streams of his song.

On the example of live concerts, one can observe a similar picture. If the box office is conditionally 100 thousand dollars, then the artist will get a gross of 50 thousand. But he has no problems with the organization of the concert, administration and other tasks that have nothing to do with creativity. But splitting the profits in half seems like a very lucrative option for the artist. Such conditions can only be obtained by very famous performers. Usually the profit ratio is much worse for the artist.

Try it free