Record Label legal question and Help needed...

klashback · Post by **klashback** » Sat Jun 13, 2009 5:03 pm

Hi ,
I need your opinion on this :

A small record label offered me to release my music, and the contract says that I will get 50% of the net profit from the tracks sales. The others 50% will go to the label.
That's sounds ok for me, but I realize that the label will charge me for sending promos, distribution, sleeve design, etc...
I know the label manager will do all this Alone, and will not employ other companies like promo agency or graphic designers, and that it will be only available in digital format on Beatport...
So is that ok to charge me for this work ?
I think that this work is part of his label manager job and justify why he'll get 50% no ???

I really don't know and I'm a bit confused, I know that this is normal to deduce the cost of mastering, manufacturing, promo agency and ads bought in the press or on the web, etc but this is different here, there is not such cost (and invoices to prove those costs)...

So for example if we make 1000 euros on Beatport.
Beatport take 40 % , so we've got 600 euros left.
It should be 300 each, because the label didn't spent any money in ads, promos, etc...
Now if the guy says I've spent some time doing promo on the internet on forums, I've negociated the deal with beatport, etc.. so I'll charge you 300 euros for that, we've got 300 euros left to share !!
it means the label man will get 450 euros and I'll get only 150 euros !!!!!
This doesn't sound right !!!

I really need your advice on this, I know that there is some label managers here and I would really appreciate their thoughts on this,

Thanks,

K.

::BLM:: · Post by **::BLM::** » Sat Jun 13, 2009 5:26 pm

Hi

You shouldnt be paying any money to the label dude. As a label owner I give my artists 50/50 recoup. So after all the costs are recouped we share the pot of money 50/50. That's the way it should be.

hope that helps
ben

klashback · Post by **klashback** » Sat Jun 13, 2009 6:39 pm

Thanks for your quick answer Ben,

So to be clear, as a label owner you don't consider negotiating with Beatport, sending promo emails, etc as a cost to recoup ?
A real cost to recoup would be a banner on resident advisor for example ?

kev.

::BLM:: · Post by **::BLM::** » Sat Jun 13, 2009 9:02 pm

Hi

Well promo emails is a cost yeah, but I thought you meant you had to pay an upfront fee to cover them costs. Basically once all the costs that went into your release are covered, the pot of money is then divided 50/50.

victorgonzales · Post by **victorgonzales** » Sat Jun 13, 2009 10:23 pm

Well it kinda depends on what the label is doing for you.

If the label is paying for promostion then yes it will come out of the sales before payment. If they are just posting on forums and emailing people then no. Labor is part of the 50 percent that the label is already taking in my opinion.

We do our own mastering for our label so we do not charge anything for that but if we where outsourcing it we would definately subtract that from the profits before payment.

I would say discuss it with the label and make sure you know exactly what costs are comming out of your release and if you do not feel it is justified then do not sign with that label.

Every contract I have had with other labels and I think ours even has it, contains wording that overhead on the release will be taken from track sales. I always make sure to ask exactly what kind of promoting they are doing and how much if any will be taken out of the release. I have never had a label take anything off the top because they ussually provide their own mastering if they think they can do better than I do on my own.

Overall Id just say talk it out with you label manager and get some straight answers from them.

p.s. don't forget to factor in the benefits depending on what label your releasing with. I would take a huge cut in profit to get on a label that I know will get me a lot of sales and some status in the game. A smaller label though I would not put up with that kind of crap.

BlueFog · Post by **BlueFog** » Sat Jun 13, 2009 10:40 pm

if he believes in your music you shouldn't be paying any money at all. he should cover all the costs that you mentioned above. a 50/50 contract is more than enough especially for a digital release.

::BLM:: · Post by **::BLM::** » Sun Jun 14, 2009 1:48 am

p.s. don't forget to factor in the benefits depending on what label your releasing with. I would take a huge cut in profit to get on a label that I know will get me a lot of sales and some status in the game. A smaller label though I would not put up with that kind of crap.

It should be the same no matter what. At the end of the day it's your music and not theirs. You worked hard to make that piece of music, so the cut should always be the same.

klashback · Post by **klashback** » Sun Jun 14, 2009 1:55 am

Thanks for the answers, to be precise again,

The label doesn't pay any third party like promo agencies etc, there is NO investment since it's digital and I'm doing the mastering, he just want to recoup the time he spends doing his label manager work and then get the 50%

Basically he treats himself as a third party and wants to charge a fee to be taken out as cost before sales thus reducing my share and putting the difference straight in his pocket.