"What Are Recording Contract Royalties?"
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Music Publishers |
Are you a new emerging musician who is beginning to become a common name in your town? Have you even begun to become a name on the internet and when you Google search your band name actual stuff of yours comes up? If this is true than it is time you look into getting a recording contract with a major record label and this article will run down some of the basic things you should know before signing.
If you have never signed a recording contract before then you probably will not know what is normal in a contract and what is not. Because of this it is important that you hire a lawyer, particularly an entertainment lawyer, who will be able to read through the contract and make sure that the record label is not doing anything that will be harmful to you in the long run. The entertainment lawyer is also able to negotiate the terms of the contract but you should beware that you will probably not be able to negotiate much on your first contract.
The big thing you will be able to negotiate, usually, is the royalties you will receive. The average royalty for new artists is around 10% but you can go as high as 20% for some of the more famous bands. How this royalty works is if you are making 10% royalty on a CD that sells for $15 you will make about $1.5 per CD sold. If your album sells a million copies you will make $1.5 million. There are two things to keep in mind about this and they are:
There are thousands of new albums released each year and you will have about a 1-in-20 chance of producing an album which is going to be a major hit.
The second thing to remember is you will actually not be making $1.5 per CD sold. Record labels pay royalties based off of the wholesale price not based off of the retail price. Some of the things that affect the wholesale price are coupons, rebates, CD giveaways, etc. Some contracts also take away packaging fees and recording fees from your royalties.
There are many things that are going to be listed on a recording contract that may seem foreign to you; as long as you have an entertainment lawyer who is able to read over the contracts and help negotiate the terms, especially the royalties, you should be able to get a good contract and you will be on your way to becoming a world famous musician.
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Brian Cook is a freelance writer whose articles on music and songwriting have appeared on many websites.
You can find more of these at SongwritersGuide.com.
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