What is a Distribution Deal?
With accessibility to modern day digital distributors like Distrokid & Tunecore, as well as the variety of digital streaming companies like Spotify, Apple Music, YouTube Music, Tidal, etc. the question is–are distribution deals necessary and/or relevant in 2019? If so, what does one look like?
Distribution deals have changed a lot over the years–but so has the music industry in general, so how can artists adapt to this new terrain? Well, like anything else it starts with information.
Companies like Empire Records have found a niche in today’s industry doing partnership deals with artists allowing them to maintain their “independence”. What they (and other similar companies) do is offer artists distribution deals in which they give the artists funding known as an advance to produce & promote a record (or series of records).
One thing artists need to be aware of and begin exercising is their ability to only take what they need. Now this seems pretty practical, like common-sense, but in reality many artists get themselves into a rut by accepting ALL of what a label offers. What a lot of people don’t understand is that an advance is just another term for a loan (I know, right?). If artists understood this there’d be a lot more hesitation in taking these deals.
In a standard record deal, traditionally labels would cover the costs for recording, touring, marketing, and every other aspect of an artists’ career. All of which costs a lot of money, so by the time payday comes your balance is in the negative–why? Because all of those 5 star hotels and high-budget music videos were actually on YOUR dime. This is why it’s important for artists to educate themselves on areas like marketing, finance, business management, social media growth hacking, as well as other creative abilities that can be leveraged to either save you money on your own projects, or help bring in revenues from businesses and artists who need your services.
Not all deals are bad, but going into a negotiation ignorant and without understanding all of your options makes any business agreement dangerous. That’s just business 101. Understand your value, their value, and how the two work together for the benefit of both parties or walk away from the table. Remember, you’re in control and you have options.
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