Recording contract

Last updated

A recording contract (commonly called a record contract or record deal) is a legal agreement between a record label and a recording artist (or group), where the artist makes a record (or series of records) for the label to sell and promote. Artists under contract are normally only allowed to record for that label exclusively; guest appearances on other artists' records will carry a notice "By courtesy of (the name of the label)", and that label may receive a percentage of sales.

A record label, or record company, is a brand or trademark associated with the marketing of music recordings and music videos. Sometimes, a record label is also a publishing company that manages such brands and trademarks, coordinates the production, manufacture, distribution, marketing, promotion, and enforcement of copyright for sound recordings and music videos, while also conducting talent scouting and development of new artists, and maintaining contracts with recording artists and their managers. The term "record label" derives from the circular label in the center of a vinyl record which prominently displays the manufacturer's name, along with other information. Within the mainstream music industry, recording artists have traditionally been reliant upon record labels to broaden their consumer base, market their albums, and be both promoted and heard on music streaming services, radio, and television. Record labels also provide publicists, who assist performers in gaining positive media coverage, and arrange for their merchandise to be available via stores and other media outlets.

Copyrights, payment and royalties

Labels typically own the copyright in the records their artists make, and also the master copies of those records. An exception is when a label makes a distribution deal with an artist; in this case, the artist, their manager, or another party may own the copyright (and masters), while the record is licensed exclusively to the label for a set period of time. Promotion is a key factor in the success of a record, and is largely the label's responsibility, as is proper distribution of records.

Copyright is a legal right, existing in many countries, that grants the creator of an original work exclusive rights to determine whether, and under what conditions, this original work may be used by others. This is usually only for a limited time. Copyright is one of two types of intellectual property rights, the other is industrial property rights. The exclusive rights are not absolute but limited by limitations and exceptions to copyright law, including fair use. A major limitation on copyright on ideas is that copyright protects only the original expression of ideas, and not the underlying ideas themselves.

A distribution deal is a legal agreement between one party and another, to handle distribution of a product.

A license or licence is an official permission or permit to do, use, or own something.

While initial recording deals usually yield a smaller percentage of royalties to the artists, subsequent (or renegotiated) deals can result in much greater profit, or profit potential. A few acts, such as Madonna, Michael Jackson, R.E.M., U2, and Janet Jackson, among others, have signed multimillion-dollar deals. Whitney Houston signed a $100 million deal with BMG to deliver just six albums, the largest recording deal at the time. Robbie Williams signed an £80m (US$125m) contract with EMI. [1] For many other artists, though, for the millions to become tangible, hit albums meeting or exceeding their previous sales figures must follow. Recording contracts may include opt-out clauses for the label in the event an act's popularity dips or the act releases non-hit albums under the deal. For instance, Mariah Carey was dropped by Virgin Records and her $80 million recording deal cancelled after her first album released by the label sold poorly. [2]

Madonna (entertainer) American singer-songwriter and actress

Madonna Louise Ciccone is an American singer, songwriter, actress and businesswoman. Referred to as the "Queen of Pop" since the 1980s, Madonna is known for pushing the boundaries of songwriting in mainstream popular music and for the imagery she uses onstage and in music videos. She has frequently reinvented her music and image while maintaining autonomy within the recording industry. Although having sparked controversy, her works have been praised by music critics. Madonna is often cited as an influence by other artists.

Michael Jackson American singer, songwriter and dancer

Michael Joseph Jackson was an American singer, songwriter, and dancer. Dubbed the "King of Pop", he is widely regarded as one of the most significant cultural figures of the 20th century and one of the greatest entertainers of all time. He was also known for his unorthodox lifestyle, residing in a private amusement park he called Neverland Ranch, and often becoming the focus of tabloid scrutiny. Jackson's contributions to music, dance, and fashion, along with his publicized personal life, made him a global figure in popular culture for over four decades.

R.E.M. American alternative rock band (1980–2011)

R.E.M. was an American rock band from Athens, Georgia, formed in 1980 by drummer Bill Berry, guitarist Peter Buck, bassist/backing vocalist Mike Mills, and lead vocalist Michael Stipe. One of the first alternative rock bands, R.E.M. was noted for Buck's ringing, arpeggiated guitar style, Stipe's distinctive vocal quality and obscure lyrics, Mills' melodic basslines and backing vocals, and Berry's tight, economical style of drumming. R.E.M. released its first single—"Radio Free Europe"—in 1981 on the independent record label Hib-Tone. The single was followed by the Chronic Town EP in 1982, the band's first release on I.R.S. Records. In 1983, the group released its critically acclaimed debut album, Murmur, and built its reputation over the next few years through subsequent releases, constant touring, and the support of college radio. Following years of underground success, R.E.M. achieved a mainstream hit in 1987 with the single "The One I Love". The group signed to Warner Bros. Records in 1988, and began to espouse political and environmental concerns while playing large arenas worldwide.

Record companies put forth huge sums of money to produce, release, and promote an album. Recording time, manufacturing, packaging, photos, distribution, marketing, and music videos are just some of the areas where the label must spend money on an act it has signed. The label usually absorbs these expenses, but in some artists contracts, some of this money may be due back to the label, unless otherwise worded. Advances (upfront money that is paid directly to a recording artist) are normally always owed back to the label. Once (and if) the advance has been paid back from record sales, the artist then begins to see royalty payments for additional sales. Advancing an act money is a risk the label endures as it does not know how well the act's album will sell. Capitol Records suspended Linda Ronstadt's contract in the early 1970s, as Capitol had spent more money on Ronstadt then it had yielded. She continued to tour partly to pay Capitol back for her 1960s deal, and a string of hits in the mid-1970s allowed her to finally clear the debt. Record companies expect to make a profit, and little concern themselves with a given performer's lack of business or financial savvy, as artists such as George Michael have discovered. "Walking out" on a deal is very difficult or nearly impossible, as is attempting to strike a new deal without completing an old one. Donna Summer signed a new deal with Geffen Records in 1980, and released an album on Geffen. She was then told by her previous label, Polygram Records, that she owed them another album, per her agreement. She recorded and delivered an album to Polygram that the label released, and it became a hit. Summer then went back to recording for Geffen Records for her next project. The Mamas & the Papas were forced into a reunion, years after their 1968 breakup, by the letter of their Dunhill Records contract, which required one more album to be completed -which became 1971's People Like Us .

Capitol Records American record label

Capitol Records, Inc. is an American record label owned by Universal Music Group through its Capitol Music Group imprint. It was founded as the first West Coast-based record label in the United States in 1942 by Johnny Mercer, Buddy DeSylva, and Glenn E. Wallichs. Capitol was acquired by British music conglomerate EMI as its North American subsidiary in 1955. EMI was acquired by Universal Music Group in 2012 and was merged with the company a year later, making Capitol and the Capitol Music Group both a part of UMG. The label's circular headquarter building in Hollywood is a recognized landmark of California.

Linda Ronstadt US-American singer

Linda Maria Ronstadt is a retired American popular music singer known for singing in a wide range of genres including rock, country, light opera, and Latin. She has earned 10 Grammy Awards, three American Music Awards, two Academy of Country Music awards, an Emmy Award, and an ALMA Award, and many of her albums have been certified gold, platinum or multiplatinum in the United States and internationally. She has also earned nominations for a Tony Award and a Golden Globe award. She was awarded the Latin Grammy Lifetime Achievement Award by The Latin Recording Academy in 2011 and also awarded the Grammy Lifetime Achievement Award by The Recording Academy in 2016. She was inducted into the Rock and Roll Hall of Fame in April 2014. On July 28, 2014, she was awarded the National Medal of Arts and Humanities. In 2019, she will receive a joint star with Dolly Parton and Emmylou Harris on the Hollywood Walk of Fame for their work as the group Trio.

George Michael English singer-songwriter, musician, producer

George Michael was an English singer, songwriter, record producer, and philanthropist who rose to fame as a member of the music duo Wham! and later embarked on a solo career. He was widely known for his work in the 1980s and 1990s, including Wham! singles such as "Wake Me Up Before You Go-Go" and "Last Christmas" and solo albums such as Faith (1987) and Listen Without Prejudice Vol. 1 (1990).

Record companies will generally increase royalty rates or give artistic freedom to get acts to re-sign contracts with them once the original deal has been fulfilled. Established acts may otherwise go where they see better opportunity. During 1980, Diana Ross released her album diana , which fulfilled her contract with Motown Records. The album spawned three US hits (a #1 and two top tens) and sold 10 million copies worldwide. Ross, however, felt she was never fairly compensated by Motown for her work with The Supremes or her solo releases. When RCA Records offered her $20 million to sign with them, Ross gave Motown the chance to match the deal, or at least offer something almost comparable. Motown, believing Ross's solo career was too up-and-down, and not seeing any reason to now compensate her for her earlier Supremes work, offered $3 million. Split with the decision to remain with the label that made her famous, or sign a deal with a company that was willing to pay her what she felt she was worth, she ultimately signed with RCA. That $20 million deal was the biggest recording contract at the time. She had signed with RCA for North America only, she signed a separate longterm contract with Capitol/EMI for international territories. That contractual amount was never officially released. However, it is believed to be as much as $20 more million and she has remained currently signed with them for over 30 years and has produced many more successful recordings internationally including her multi-platinum 1991 release, The Force Behind the Power and an even greater success with a greatest hits compilation, One Woman: The Ultimate Collection that sold over 1.5 million in the United Kingdom alone, spending several weeks at #1.

Diana Ross American vocalist, music artist and actress

Diana Ross is an American singer, actress, and record producer. Born and raised in Detroit, Michigan, Ross rose to fame as the lead singer of the vocal group the Supremes, which, during the 1960s, became Motown's most successful act, and are the best charting girl group in US history, as well as one of the world's best-selling girl groups of all time. The group released a record-setting twelve number-one hit singles on the US Billboard Hot 100, including "Where Did Our Love Go", "Baby Love", "Come See About Me", "Stop! In the Name of Love", "You Can't Hurry Love", "You Keep Me Hangin' On", "Love Child", and "Someday We'll Be Together".

<i>Diana</i> (album) 1980 studio album by Diana Ross

diana is the tenth studio solo album by American singer Diana Ross, released on May 22, 1980 by Motown Records. The album is the biggest-selling studio album of Ross's career, selling nine million copies worldwide and spawning three international hit singles, including the US and International number 1 hit "Upside Down".

The Supremes American Motown female singing group

The Supremes were an American female singing group and the premier act of Motown Records during the 1960s. Founded as The Primettes in Detroit, Michigan, in 1959, the Supremes were the most commercially successful of Motown's acts and are, to date, America's most successful vocal group with 12 number one singles on the Billboard Hot 100. Most of these hits were written and produced by Motown's main songwriting and production team, Holland–Dozier–Holland. At their peak in the mid-1960s, the Supremes rivaled the Beatles in worldwide popularity, and it is said that their success made it possible for future African American R&B and soul musicians to find mainstream success.

There are plenty examples of recording contracts available in music business guides, legal texts and also online. [3]

Termination

When recordings go out of print, this typically happens because either the label has decided that continuing to sell (or distribute) the record will not be profitable, or the licensing agreement with the artist has expired. (Labels may also stop distribution as a punitive measure, if an artist fails to comply with their contract, or as a strategic measure if negotiations for a new one prove difficult.) Record labels can also become bankrupt like any business, and their masters and copyrights sold or traded as part of their assets. (Occasionally these are purchased by the artists themselves.)

Recording artists signed to a failed label can find themselves in limbo, unable to record for anyone but a company that is out of business (and thus cannot sell or distribute their records), and with their existing works unavailable for sale. When one label "buys out" another (or a label is purchased by an outside party), any existing copyrights and contracts held (and masters, if owned by the label) normally go with the sale. This often benefits recording artists, but not always.

Distribution deals are often renewed, but occasionally the label and the copyright owner cannot come to terms for a renewal. The reason is usually that one party expects too much money, or too large a percentage of profits, to suit the other.

See also

Related Research Articles

Atlantic Records American record label

Atlantic Recording Corporation is an American record label founded in October 1947 by Ahmet Ertegün and Herb Abramson. Over its first 20 years of operation, Atlantic earned a reputation as one of the most important American labels, specializing in jazz, R&B, and soul by Aretha Franklin, Ray Charles, Wilson Pickett, Sam and Dave, Ruth Brown and Otis Redding. Its position was greatly improved by its distribution deal with Stax. In 1967, Atlantic became a wholly owned subsidiary of Warner Bros.-Seven Arts, now the Warner Music Group, and expanded into rock and pop music with releases by Led Zeppelin and Yes.

Motown Records is an American record label owned by Universal Music Group. It was originally founded by Berry Gordy Jr. as Tamla Records on January 12, 1959, and was incorporated as Motown Record Corporation on April 14, 1960. Its name, a portmanteau of motor and town, has become a nickname for Detroit, where the label was originally headquartered.

RCA Records is an American record label owned by Sony Music, a subsidiary of Sony Corporation of America. It is one of Sony Music's four flagship labels, alongside RCA's former long-time rival Columbia Records, Arista Records, and Epic Records. The label has released multiple genres of music, including pop, classical, rock, hip hop, electronic, R&B, blues, jazz, and country. Its name is derived from the initials of its defunct parent company, the Radio Corporation of America (RCA). It was fully acquired by Bertelsmann in 1986, making it a part of Bertelsmann Music Group (BMG); however, RCA Records became a part of Sony BMG Music Entertainment, a merger between BMG and Sony Music, in 2004, and was acquired by the latter in 2008, after the dissolution of Sony BMG and the restructuring of Sony Music. It is the second oldest record label in American history, after sister label Columbia Records.

Epic Records American record label

Epic Records is an American record label owned by Sony Music Entertainment, a subsidiary of Sony Corporation of America, Inc., the North American division of Japanese conglomerate Sony. The label was founded predominantly as a jazz and classical music label in 1953, but later expanded its scope to include a more diverse range of genres, including pop, R&B, rock, and hip hop. Epic Records has released music by artists including Glenn Miller, Tammy Wynette, George Michael, The Yardbirds, Donovan, Shakin Stevens, Europe, Cheap Trick, Meat Loaf, Stevie Ray Vaughan, Ted Nugent, Shakira, Sly & the Family Stone, The Hollies, Celine Dion, ABBA, Culture Club, Boston, Dave Clark Five, Gloria Estefan, Pearl Jam, Rage Against the Machine, and Michael Jackson. Along with Arista, Columbia and RCA Records, Epic is one of Sony Music Entertainment's four flagship record labels.

Mary Wells American pop/soul singer

Mary Esther Wells was an American singer who helped to define the emerging sound of Motown in the early 1960s. Along with the Supremes, the Miracles, the Temptations, and the Four Tops, Wells was said to have been part of the charge in black music onto radio stations and record shelves of mainstream America, "bridging the color lines in music at the time."

Velma Jean Terrell is an American R&B and jazz singer. She replaced Diana Ross as the lead singer of The Supremes in January 1970.

Asylum Records record label

Asylum Records is an American record label, founded in 1971 by David Geffen and partner Elliot Roberts. It was taken over by Warner Communications in 1972, and later merged with Elektra Records to become Elektra/Asylum Records.

Warner Bros. Records American record label

Warner Bros. Records Inc. is an American record label owned by Warner Music Group and headquartered in Los Angeles, California. It was founded in 1958 as the recorded music division of the American film studio Warner Bros., and was one of a group of labels owned and operated by larger parent corporations for much of its existence. The sequence of companies that controlled Warner Bros. and its allied labels evolved through a convoluted series of corporate mergers and acquisitions from the early 1960s to the early 2000s. Over this period, Warner Bros. Records grew from a struggling minor player in the music industry to one of the top record labels in the world.

T-Neck Records American record label

T-Neck Records was a record label founded by members of the R&B/soul group The Isley Brothers in 1964, which became notable for distributing the first nationally-released recordings of Jimi Hendrix, their guitarist, and which later became a successful label after the Isleys began releasing their own works after years of recording for other labels, scoring hits such as "It's Your Thing" and "That Lady".

Independent music is music produced independently from commercial record labels or their subsidiaries, a process that may include an autonomous, do-it-yourself approach to recording and publishing. The term indie is sometimes used to describe a genre, and as a genre term, "indie" may include music that is not independently produced, and many independent music artists do not fall into a single, defined musical style or genre and create self-published music that can be categorized into diverse genres. The term ‘indie’ or ‘independent music’ can be traced back to as early as the 1920’s after it was first used to reference independent film companies but was later used as a term to classify an independent band or record producer.

<i>Greatest Hits 1976–1986</i> 1992 compilation album by Elton John

Greatest Hits 1976–1986 is a collection of hits by Elton John released in the United States only by MCA Records in 1992. It replaced an earlier compilation, Geffen's 1987 release Elton John's Greatest Hits Vol. 3. This was necessitated because of a shift in the control of copyrights and a resulting reshuffling of compilation albums.

<i>Workin Overtime</i> 1989 studio album by Diana Ross

Workin' Overtime is the seventeenth studio album by American singer Diana Ross, released on June 6, 1989 by Motown. It was Ross' first Motown album since Diana (1980), after Ross left the label for a then record breaking $20 million deal with RCA. Upon Diana's return to the label, Motown founder Berry Gordy, Jr. had sold the label to MCA Records and had positioned Jheryl Busby to the head of Motown. Ross was at first reluctant to return to her old label but Gordy promised her a lot in her return: not only would Ross return to Motown as a recording act, but she would be the label's part-owner. Ross reunited with collaborator Nile Rodgers to make this album - which was an attempt to gear her to a much younger audience bringing in new jack swing productions and house music.

Capitol Music Group American record label

Capitol Music Group is an American front line umbrella label owned by the Universal Music Group (UMG). It oversees handling of record labels assigned to UMG's Capitol Records division and was inherited from its acquisition of EMI's catalog. It is one of five umbrella labels owned by UMG, the other four being Interscope Geffen A&M, Island Records, Def Jam Recordings and Republic Records. Labels distributed under the CMG brand include Capitol Records, Virgin Records, Motown Records, Blue Note Records, Astralwerks, Harvest Records, Capitol Christian Music Group, Priority Records, Atom Factory Entertainment and Deep Well Records.

Carl Sturken and Evan Rogers are New York-based songwriters and record producers who are business partners and friends. They have produced hits for Ruben Studdard, Wild Orchid, Christina Aguilera, Evelyn Champagne King, and Rihanna. They helped build the career of Rihanna, and are the principals of her production company named SRP Music Group. As songwriters and record producers, Rogers and Sturken have achieved more than twenty top 40 hits, twelve top 5 hits and six BMI Awards. Their songs have sold more than 60 million albums around the world.

The Gordys are an African-American family of businesspeople and music industry executives. They were born to Georgia-reared parents Berry "Pops" Gordy Sr. and Bertha Fuller Gordy and raised in Detroit, where most of the siblings played a pivotal role in the international acceptance of rhythm and blues music as a crossover phenomenon in the 1960s. The accomplishment is attributable to the creation of Motown, a company founded by the seventh-oldest sibling, Berry Gordy Jr.

19 Recordings British record label

19 Recordings Inc. is a New York-based record label owned by 19 Entertainment. Founded in London by British entrepreneur Simon Fuller in 1999 as the music division of 19 Entertainment, the label is one of the top record imprints as compiled by Billboard in 2012. 19 Recordings has the exclusive rights to sign contestants of the television series Idols. Since 2005, it shifted its main operations to the United States following CKX, Inc.'s acquisition of 19 Entertainment.

References

  1. Gibbons, Fiachra (2002-10-03). "Robbie Williams signs £80m deal". The Guardian. London.
  2. "Carey On". CBC.ca . CBC. 2005-12-13. Retrieved 2011-02-24.
  3. "Exclusive Recording Contract Template". Musiclawcontracts.com. 2016-03-05. Retrieved 2016-11-21.

Bibliography