Artists are offered a variety of deals and opportunities every single day.
Unfortunately, there are plenty of legitimate looking businesses that simply prey on artists and their desire to become ultra-successful. Plus, email spam is commonplace in virtually everyone’s inbox unless you have amazing filters. Watch out for those just trying to get into your pockets!
But what would you do if a major record label offered you contract?
Many artists would jump at the chance, thinking it’s their ticket to stardom and wealth. Other, more calculated artists would likely carefully comb through the details of the contract to determine if it’s the best agreement they could hope for.
There isn’t necessarily a right and wrong answer, but if you don’t know what you’re getting into, you could end up making a regrettable decision, especially when it comes to 360 deals. Although signing a contract like this could help you advance your career, it also has the potential to harm it.
Here are the pros and cons of signing a 360 deal as an artist.
What Is A 360 Deal?
There was a time when record contracts were much simpler. In the past, labels only took a cut of record sales and other revenue generating activities they were directly involved in. That’s not what a 360 contract is.
A 360 deal entitles the record label to a percentage of earnings from everything you generate as a band or artist.
With a multiple rights deal (which is essentially what a 360 deal is), labels can lay claim to a percentage of your: Digital sales, streaming royalties, merchandise sales, licensing and placement royalties, endorsements, songwriting, publishing revenue, advertising revenue, and virtually any other income stream you can think of. It even gives the label the right to acquire your copyrights.
In the past, there was something called an artist development deal. You don’t hear much about these anymore, because labels don’t generally want to wait for an artist to develop and reach their potential over the course of two, three, or maybe even four albums. But labels also offered such contracts in exchange for rights to royalties or anything else that made the contract more beneficial to them.
Today’s 360 deal is a bit like an artist development deal from the past, except labels are far more upfront about the fact that they will have a finger in every pie. The upside for the artist is that in a 360 deal, labels will often act as managers, looking after your entire career and helping you develop as an artist.
This is mostly what it boils down to – 360 deals give labels a chance to sign artists they wouldn’t otherwise be able to, because they may not even have to recoup their investment if the artist fails. They can even keep working with the artist, after they’ve failed, if they see it as a worthwhile prospect.
Pros Of A 360 Deal
There’s a good chance you’re already starting to sort out both the advantages and disadvantages of a 360 deal in your own mind. But here’s a more detailed look at what makes 360 deals potentially worthwhile for artists.
You May Not Have To Cover All Your Own Costs
This is a bit of a subjective realm, because it depends on the contract.
With some record contracts, you might end up having to do a lot of your own promotion work and even foot most of the expenses.
This is where 360 deals are usually a little different. Many of your costs will be covered by the label, and they may even book entire tours on your behalf, although let’s be real – that’s just their way of saying “get to work”.
Naturally, you’ll save a bit of money not having to pay for a booking agent or your own merch. The label is more amenable to doing that since they make a percentage on everything you generate. But if your music flops, labels will do anything they can to recoup costs, leaving you with the short end of the stick.
You May Have The Opportunity To Develop As An Artist
As I was saying earlier, artist development deals are mostly a thing of the past, except with some independent labels. Most major record labels don’t want to take any major risks, and usually just sign artists who have their music, image, and branding in perfect order.
But a 360 deal is generally low risk for labels. If they choose to keep working with you after your first album and tour, it could mean they see the potential in what you’re doing and want to give you a fair chance at growing and succeeding.
Even if you never “hit it big”, the lessons you learn from working with a label could certainly be applied to a successful and even lucrative career as an independent artist. But if you see failure in a record contract as “the end of the road”, as many artists do, you’ll never get around to creating your own version of success.
The flip side of this is that you could be dropped by the label at any time.
Access To The Best People In The Industry
“Best” is always a subjective term, but since you’ll be signed to a major label, you will have access to experienced producers and engineers, and of course a marketing powerhouse.
Basically, you won’t have to worry about all the details. If they’re doing their job, the label should be helping you to get your music on the radio, book tours and manage your itinerary, find licensing and placement opportunities, and so forth.
Getting to work with industry luminaries is always an exciting prospect. This doesn’t mean you’ll get to choose who you work with, but you will be set up with people who know what they’re doing.
Cons Of A 360 Deal
To be fair, there are some significant upsides to a 360 deal, and there’s even the chance you’ll land on your feet, just as Paramore did.
But for better or for worse, the cons still tend to outweigh the pros in a deal like this. Here’s why.
Record Labels Take A Percentage Of Everything
This is not how standard record contracts work, though in these tumultuous times, “standard” is a bit of a moving target.
As I’ve already shared, one of the most prominent characteristics of a 360 deal is that labels claim a percentage of all the money you generate as an artist. In this contract, you’ll never truly be free to make your own money. If the income is attributable to your music career, then a piece of that pie belongs to the label.
You should never enter a contract without knowing what you’re getting into. If you agree to these terms, then you can’t complain after the fact. You are responsible for your decisions.
I recognize that many artists see getting a record contract as the holy grail. But in many cases, it isn’t everything it’s cracked up to be. To be perfectly honest, some artists would do better as independents and might even have a better chance at success on their own terms staying independent.
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