Read This Before You Sign That Music Contract

Posted by | November 29, 2017 | Build your fanbase, sell music online | No Comments

Here at, we provide the resources needed to go into business for yourself, but we understand there are many options to choose from when it comes to launching your music career. Signing to a record label sounds like a phenomenal opportunity, but remember, the music industry is a business. While your music might be of interest to a record label, more than likely, you are being signed because you have a huge fan-base and have done the due diligence to get their attention. Our advice is to try to work out a deal where you are the sole owner of your masters/copyright & can use their services as leverage to build your brand/distribution network. In other words, help them build your business, but don’t sign your life away. Remember, this is your career & the fact is that out of the thousands of acts signed, only 1% actually recoup their investment, the others are dropped. So, be smart and protect yourself before hand. More than likely you’re going to be doing this for the rest of your life, so enjoy the journey and stay away from “Advances” and “Credits.” Here are some prerequisites to follow to help you out if/when you do decide to sign with a Record Label.

Getting your first music deal is an exciting moment, but if you don’t take the right precautions, you might lose more than you’re getting. Learning more about how music contracts work can help ensure you don’t get taken for a ride.

Watch Your Total Sales

When a young musician signs with a record label, the excitement can be overwhelming. It’s easy to get caught up in the moment and forget to ask some questions or take the time to read the fine print of your deal. For instance, ensure your record label is collecting the money from all of your sales. This includes domestic and international sales, but it also includes all digital sales. Smaller labels may be well intentioned, but they may lack the resources to ensure you’re collecting everything you’re owed.

Make Sure You Know Your Recoupment Terms

Suppose you negotiate a deal that includes a sum of $150,000 to make music videos for your singles. In many cases, this isn’t a gift, but a loan or advance from the studio that must be repaid out of future earnings. Make sure you know the terms. Will the entire sum need to be repaid, or just a portion? Are you also being charged for meetings, such as lunches with the label representative? These are all questions to consider in relation to what recoupment charges the record label is demanding.

How Do Advances Work?

Suppose you’ve been offered a $50,000 advance against record sales. Great job! Now, suppose your album only brings in $30,000. Guess what? You may end up owing the record company. In some cases, enough may be earned to cover the advance and production costs, but the artist and be left with little income coming in from those album sales. In reality, he or she made that money months earlier, when the record company paid them that advance.

Retain Creative Control

Here is something that destroys the careers of many artists. They don’t get legal advice on their contracts, nor do they read them thoroughly for themselves. As a result, the label may be able to use your image or your work in any way they see fit. This could destroy your public image and ruin a promising career. Instead, insist on retaining sign-off powers on every major decision, so you know exactly what the record label is doing in your name.

There are many more key points to watch out for when negotiating a record contract. The best thing a new artist can do for his/herself is to consult a contract lawyer, preferably one experienced with entertainment law. This will ensure you don’t sign your rights — or your career — away by accident.

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