Today's USA Today Life section feature story is about how the money gets divided up from an album that goes gold.
I'd somehow thought that the musicians at least did OK, but it ain't so. Not even close.
No wonder Prince went ballistic at Warner Brothers.
Read the entire article below if you want the whole ugly truth, but in any case, consider these facts from the story:
A new band signs a standard contract, and all the usual and customary things occur.
The album sells for a suggested retail price of $18.98.
It goes gold (500,000 copies sold).
That's 500,000 x$18.98 = $9,490,000 in gross receipts - nearly 10 million dollars.
After everyone takes their cut, the band - let's say, for the sake of argument, it's five young kids - gets $40,250.
For all five band members to divide up.
But wait - it gets worse.
That $40,250 - $8,050 per person - is BEFORE management and agents, etc., take their cut.
So if you go gold, don't quit your day job just yet, would be my advice.
Here's the whole USA Today article, by Edna Gundersen:
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When Sam Moore considered retiring in the early '90s, he had 30 sweaty years of show business behind him, starting with such '60s Sam & Dave hits as Soul Man and Hold On! I'm Comin'.
After selling millions of records for Atlantic Records, a Warner Bros. label, Moore expected a comfortable nest egg. He found barely a goose egg.
"Sam was told his pension would be $63.67 a month," says Joyce Moore, his wife and manager.
"It should have been $8,000. It's wrong, and it all ties back to royalties. From 1965 to 1992, Atlantic contributed not one penny to Sam's pension."
"The whole problem is accounting and accountability. We know the labels don't know how to count except when it comes to their own money."
Sam Moore and other R&B vets are suing major labels Sony, Universal, BMG, Warner and EMI for failing to accurately report royalties or make required contributions to the American Federation of Television and Radio Artists' Health and Retirement Funds. The suit is pending.
Though the industry has rectified some egregious practices of the past, royalty rates and calculations still stir distrust.
"Just move the decimal point over," says the singer, 68.
"I don't want a handout, I don't want a telethon, I don't want anyone to pass the hat. If they'd just paid into it, I'd be getting a fair pension. I never got a straight accounting on royalties."
The record business abounds with tragic lore of music pioneers cheated out of earnings by predatory managers and labels.
Today's industry is cleaner but still too byzantine to seal any deal with a handshake. And no aspect is thornier than royalties, which lend record contracts a Rube Goldberg complexity and cause for conflicts.
Article comments
1 - Douglas Mays
Good post! Yes, it is quite a battle therefore some fuckery takes place to balance the books. Wherever a buck can be reappropriated it will, such as the case with Sam Moore.
And now, with music downloading for a cost (iTunes, etc.) that is another spot on the bueracratic learning curve.
True, one hit artist pays for the other 9 that don't make it. Quite a roll of the dice on the record company, but the small change it takes to treat someone like Sam Moore as a human being sure makes the current state of the music industry look like assholes.
It is a very complex issue. The whole system needs a spin dry.
peaceloveguidance
2 - Vern Halen
Ouch! I don't know why anyone would want to be in the music biz if this is how it's run. Now that I think about it, almost every rockstar bio I've read has a section or two or ten containing a financial tale of terror.
Still, I guess it takes a certain kind of person to keep plugging away at it until the brass ring comes within reach. Unfortunately, having that kind of personality and having talent don't necessarily corelate with each other.
3 - brown_boognish
Just don't sign to a major label if you want to avoid this shit. You can live an adquate life on a smaller label, and still get substantial distribution. No long contracts to screw you over.
4 - Vern Halen
Maybe part of the problem is that there are no long term contracts - t least ones that are designed to develop & nurture an artist with an investment over a period of years. Big Biz wants big bucks NOW, and if you don't make it the first time round right out of the starting gate, it's hard to get a second chance.
Think of almost any major artist from the 70's: Springsteen or Aerosmith, for example. Had they been dropped after their first or second albums, which had only moderate sales, they might mot have developed into the megastars they are today.
Simply put, it'd be really nice if music was the most important word in the phrase "music business."
5 - Douglas Mays
hhhmmm... the question of go indy or major. My suggestion is go major, if it fails you always have indy to fall back on.
Utilize a major. Just on advances alone and marketing (however slight it might be) that puts you far ahead of what an indy can do for you.
Then think of this, being a broke starving artist or complaining that you are owed another $50,000 on top of your $million.
A good, creative music attorney is helpful. Take a look at White Stripes for example.
Anyway, big risky business. It is a shame that the trickle-down effect to artists like Sam Moore occur. That is one of the holes that has to be plugged up. The industry must take care of its own till they die. Then in this business, after death also. Funny how death can sell records in this biz. Oh gosh, the next phase of music business scandle. Record companies wacking artists to really cash in...
anyway,
peaceloveguidance
6 - Douglas Mays
A classic phrase in the business: "not happy with your record contract? Be lucky you have one."
peaceloveguidance
7 - Vern Halen
hmmm.......makes you wonder about all those Cobain conspiracy theories out there.....
8 - Douglas Mays
I wonder... it wasn't Courtney. It might of been Tony 'the weasel' Belefukio.
Sorry, Courtney. Didn't mean to remind you of all these hack accusations being thrown at you.
peaceloveguidance
9 - Douglas Mays
Come to think of it, could be the case with Tupac...