5 Reasons You Don't Want the Record Deal of Your Dreams

The record industry has undergone many changes over recent decades. From big advances and historic record sales, to the internet, Napster, MP3s, streaming, and 360 deals… a lot has happened and it’s sometimes hard to keep up with. But if you’re like me, you grew up wanting the record deal that could change your life overnight. However, with the once under-wraps information coming to light in recent years about what really happens when you sign the “contract of a lifetime,” artists know now more than ever that it’s not all it’s cracked up to be. Here are five reasons you don’t want the record deal you’ve dreamed of:

 

1. You’re getting the short end of the stick financially

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Record companies are in business for one reason, and one reason only… to make money. You are an investment to them. You are a number designed to produce numbers in the form of dollar signs. No one cares about your feelings, no one cares how you are living day to day, month to month, year to year, or beyond. Signing with a major label is essentially accepting a giant loan with the most unfavorable terms possible. A million dollar deal does not mean you get written a check for a million dollars. What it means is that they will spend that budget however they see fit to get a return on their investment. So what does that translate to for you? A lot of mismanaged funds, overpriced studio time, nonsensical marketing efforts, and a fat bill you weren’t expecting to get with every frivolous line item you can imagine - from the wrapping of your physical CDs, to the unnecessary jet they put you in to get you to your next show. The label must make back every penny and then some… and it’s all on your shoulders to earn that back through your music, regardless of if it’s done your way or not. 

 

2. Stifled creativity

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Your music-making creativity often ends the second the ink dries on the last page of that contract. You are now an asset and it’s ultimately up to the label what music you make, how you make it, when (or if!) it’s released, who you’re marketing to and how, what your image is, and more. Got a song you feel really strongly about putting out as the first single, but the label doesn’t feel the same way? Guess what happens? That song will probably never get released. And don’t think you’re going to release it on your own… no, no. Remember what you signed, because whatever the label needs, is what you are to become - otherwise, fear for being in violation of contract (see also: court time and being bled dry financially by one of the biggest corporations in the world), and risk getting dropped to boot.

 

3. High likelihood of being shelved

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Just because you’re signed, doesn’t mean you will become the next big thing overnight. Actually, it doesn’t even mean your music will ever see the light of day. Being shelved is when a label signs you but “back burners” your project, essentially leaving you in musical purgatory. For a creative person, this is arguably the worst place to be and the absolute most terrible thing that can happen to you. Imagine having so much music, being so excited about getting signed after many years of pounding the pavement, having all your friends and family awaiting your radio debut… and nothing. Welcome to the real music industry; the label doesn’t have to do anything and owes you nothing - and there’s nothing you can do about it because that’s what you signed away. Worse, some people don’t even realize that sometimes a label signs you not because they think you are the next superstar, but because they already have the next superstar on their roster and they don’t want to worry about any competition. So the “next Ariana Grande” may indeed be on her way to the top… but don’t think you’ll see her. Because that label will do anything and pay anything it can to add her to their roster to ensure nothing slows down the present AG money-making machine.

 

4. 360 deals

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360 deals are the music industry’s way of making even more money off their artists since music isn’t quite paying out the way it used to in the pre-internet days. So what does that mean for you? Be prepared to not only give all of your music earnings to the label until the full budget has been paid back and then some, but also know that they will take a percentage of all of your earnings from live performances, publishing, endorsement deals, merchandise, movie & TV appearances, and beyond. Nothing is yours anymore, and they are going to ensure that their investment in you is sound for years to come, through any way possible.

 

5. Labels only want you when you no longer need them

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Today, labels want it all when you walk through the door. High-quality recorded music, a polished “package,” thoughtful artist development, an expansive fan base, and serious numbers in the form of likes, streams, follows, subscribers, etc. This may seem backward to you, and well, that’s because it is. Before, a label would sign talent. From there, they would develop them, nurture their skillset, hook them up with the best songwriters and producers in the biz, facilitate opportunities and pull strings to put them on every major stage, red carpet, and magazine cover to get them the exposure needed to become a star. From there, the fans come and the snowball grows and grows until it’s rolling down the hill full-speed on its own. But now that artists are responsible for doing all the leg work on their own, it’s no wonder why the overall mainstream music quality of the industry has suffered as a whole. But more importantly for you, why the heck would you work so hard to get to a point where you’re already a self-made success, just to have a label swoop in to take a piece of the pie for free? Today’s major labels will only offer you a million dollar deal when they know they can make a whole lot more off of you. If you’ve made it far enough yourself and seeing results and a real income stream form, use this to your advantage - invest in quality, find good people to be a part of your team that have your best interest in mind, and do it your way. You don’t need a bunch of people in suits in a top-floor office to tell you how to make music and engage with your fans, because you’re already doing it. Remember what the goal is and don’t lose focus of that. Making a living doing what you love is what’s most important, and creating a body of work you’re proud of that connects with people. A label won’t buy you that, or should I say, you won’t buy yourself that with the label’s borrowed money. Stay the course, and remember that the labels only want you when you no longer need them. Thrive on your independence, and only entertain that kind of investment when it benefits you, and not in the reverse.

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Christine Elise Occhino (@XtineElise) is a serial entrepreneur with a passion for the music business. In addition to being a vocalist herself, she is the CEO of Elise Music Group, Artistic Director of The Pop Music Academy, and owner of Stamford Recording Studio. She is also the proud Founder & Executive Director of Hope in Harmony, a 501(c)(3) nonprofit organization that uses music to help and heal those in need. Christine is a member of the Grammy Recording Academy, the American Society of Composers, Authors, & Publishers, and Berklee College of Music Alumni Association. She has experience speaking on many music industry panels and has been a contributing writer for music business publications for over a decade.