If they make tons of money selling it, then the rewards are all theirs; you don't make any money beyond your original licensing fee. If they lose money on the album, then that loss is all theirs too; you still keep your licensing fee regardless of the album's performance and sales.
- The Truth About Record Deals (And How To Negotiate Them)?
- The Truth About Record Deals (And How To Negotiate Them).
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Distribution, on the other hand, refers to getting your albums into shops. With a distribution deal , you only make money on what you sell, and your label is responsible for manufacturing and promotion. If you make a lot of money, you get to keep it all.
Spotify IPO filing reveals how insanely complicated it is to license music rights
But if you lose a lot of money on the album, then the losses all come from your pocket. Licensing and distribution each have pros and cons. For your own territory, a distribution deal is ideal, because it leaves you in the driver's seat. You want to build a name for your label, and to do so, you have to be in control of your releases and artists.
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A licensing deal may be appropriate in a label's territory in this case; the bigger label may have the resources to give the artist more promotion, and the licensing deal could be a sizable cash injection for the small label. As a general rule, it makes sense to go for distribution rather than licensing in your own backyard.
However, when it comes to getting your albums into the international market, licensing offers plenty of benefits for a small label, including:. Of course, if the album is a big hit in the new territory, and the overseas label makes a bundle, your licensing fee could start looking insignificant. That's the inherent risk with licensing, but it's a good gamble for many small labels.
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Managing an overseas distribution situation is time-consuming and requires working closely with the distribution company. This means that once the contract period is over, you regain full control over your music. We also maintain transparent relationships with our artists, never keeping you in the dark about your career.
If offered a record deal, there is no obligation to sign. When we find an artist we believe in, we offer them a licensing deal that includes strategic planning, marketing, financing, branding and PR. Get updates about Amuse. Sign up! Free music distribution for everyone. Record deals for artists we believe in.
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