The Great Rock And Roll Swindle?
Artists (and some lawyers) have been arguing for years that most conventional record contracts are artificially stacked in the labels' favour. One of the most recent to speak out is Hole's Courtney Love, who gave a speech on the subject to the Digital Hollywood Online Entertainment Conference, held in New York in May this year.
"TLC," she told the assembled audience, "declared bankruptcy after they received less than 2 percent of the $175 million earned by their CD sales. That was about 40 times less than the profit that was divided among their management, production and record companies… Toni Braxton also declared bankruptcy in 1998. She sold $188 million worth of CDs, but she was broke because [her recording contract] paid her less than 35 cents per album.
"Story after story gets told about artists… some of them authors of hugely successful songs that we all enjoy… living in poverty, never having been paid anything. Artists who have generated billions of dollars for an industry die broke and uncared-for. And they're not actors or participators. They're the rightful owners, originators and performers of original compositions. This is piracy."
Whether or not one agrees with Love's argument, there are several aspects to the average record deal which might strike the unsuspecting onlooker as, well, a little one-sided. Here are a few: Packaging deductions. These are the percentages by which your recording royalties are reduced when your releases are produced in certain formats. I'm not just talking about outlandish formats like picture discs, or poster packs (although special products like these certainly attract hefty deductions). I'm talking about formats like CD.
Here are some sample packaging deductions from a contract signed in 1998:
Never underestimate the power of stupid people in large groups