Since it is getting harder and harder to make music by selling albums alone, record labels are turning to 360 deals. These deals let a record label take a piece from all of the income earned by a musician, not just their album sales. Should you sign a 360 deal? Before you put pen to paper, ask these questions.
Don't know what a 360 deal is? Before you go any further, check out this definition.
What Income Is On The Table?
The whole point of a 360 deal is that the record label gets a cut of most, if not all, of your revenue streams. However, push to get down to the specifics of what exactly that means. Although a surprising number of labels (and managers) seem to think that they should get a cut every time your nana sends you a birthday check, why should you be paying for services you are not receiving? Hammer out a specific list of what income is included in the 360 deal and work to keep the whole pie for income that the label is not helping you earn.
Who Will Be Handling The Responsibilities?
360 deals are being embraced by labels at the same time many of them are laying off staff. In other words, labels are taking on more work when they are reducing the number of workers around to do it. Get some assurance that the label has the manpower and the expertise to get involved in managing every aspect of your career. If they don't, this isn't a good deal for you. You will need to bring on extra help and pay them to do work you are already paying the label to do. Again, only split the pie with the people who helped bake it. Anything less isn't a fair deal for you.
What Percentages Are We Talking Here?
Of course, you will want to know exactly how much the label wants of your money. Is it a flat rate across the board? Is there a tiered system for deals they land for you and ones that you negotiate without them? You may not find a lot of wiggle room here - labels often have a standard deal - but you need to know what you're looking at. Plus, it never hurts to at least try to shave a few points off.
I'm Going to Need to Run This By My Lawyer
Not really a question, but very important all the same. 360 deals are complicated. You are signing away the rights to lots of different revenue streams, which could come back and bite you in a big way. Don't assume you understand everything. Getting legal advice before you sign a 360 deal is a must. And don't let the label send you to their lawyer, either.