Deals/Contracts Quiz

5.5.25

Licensing Deal

Label licenses Masters, but artist keeps their Master Rights.

360 Deal

A type of recording contract where the record label gains a share of an artist's revenue from various sources beyond traditional record sales, including publishing, merchandise, and touring.

Joint-Venture Deal

A partnership where two or more parties collaborate to co-publish and promote music. They share resources, risks, and profits, allowing for greater reach and influence in the industry

Traditional Deal

an agreement where an artist signs with a label, and in exchange for financial backing, marketing, and distribution, the label gains ownership of the artist's recordings and may take a portion of other income streams

3 MAJOR LABELS

Sony, Universal, Warner

Difference between demographics and psychographics

Demographics focus on the measurable, statistical characteristics of a population, like age, gender, and income, providing a basic understanding of "who" is in the market. Psychographics, on the other hand, delve deeper into the psychological factors influencing consumer behavior, such as values, beliefs, attitudes, and lifestyle, revealing "why" people make certain choices

Controlled Composition Clause

A controlled composition clause in a recording contract limits how much a record label pays in mechanical royalties for songs written, co-written, or owned by the performing artist. It essentially reduces the mechanical royalty rate, often to 75% of the statutory rate, and may include a cap on the total royalties paid per album. This clause is designed to protect the label from potentially high royalty payments for songs the artist has a significant interest in.

Sunset Clause

In the music industry, a sunset clause in a management agreement specifies that a manager continues to receive a commission on the artist's earnings even after the management contract ends, but for a limited time period.

Keyperson Clause

A contractual provision that protects an artist or band from being bound to a management company or label if a crucial individual (the "key man") leaves.

What is a product manager's role at a record label?

A product manager oversees the planning, marketing, and release of an artist’s music project, coordinating between departments (like marketing, sales, PR, and creative) to execute the release strategy.

4 Ps of Marketing Mix

• Product – What you're selling

• Price – How much it costs

• Place – Where it’s sold/distributed

• Promotion – How it's marketed

Artist as CEO:

The artist acts as the CEO of their brand. They approve all key hires—manager, agent, lawyer, business manager, tour team, etc.—to run their career like a business.

What is windowing?

Windowing is releasing content in stages across different platforms to maximize exposure and revenue (e.g., a movie in theaters first, then streaming later).

Brain parts (with Ben and Jerry’s example):

• Neocortex (Rational) – Thinks: “Is this healthy?”

• Limbic (Emotional) – Feels: “I love this flavor!”

• Reptilian (Physical) – Acts: Grabs the pint and eats it.

Line Stretching

Expanding an artist’s brand to higher or lower tiers (a new deluxe album).

Line Extension

Creating new content under the same brand.