Record Labels….To Sign or Not To Sign? That is the Question!
The pinnacle of a young band’s ambition back in the day was more often than not securing a record deal with a music label. Record label advances were a sought-after commodity to help get a band up and running, and the PR backing of a major label was the way into the homes of music buyers, and also the music charts. But this was when music was purchased as a physical product, and as we all know, times have changed considerably. In fact, so much to the point now where it is perfectly valid to ask yourself if you actually need a record deal at all.
Let’s start with that glamorous advance…don’t kid yourself folks, it is not a gift! It is a loan, payable back from royalties. So if your advance was £50k, your first £50k in royalties goes straight back to the record company. But moreover, in this world of digital home technology, from music production to artwork to social media, many of the services provided by a record company can now be done by you, in the comfort of your own home, at no advance royalty cost to yourself.
Things like production costs, distribution points, web based access to enhance sales pipelines etc , these are things that a musician never previously had access to and by utilising them carefully and strategically, can help turn a band/brand into a full blown cottage industry without the need for a traditional record deal.
Let’s look at some evidence on factors that will help you to make a decision on the future of your product. By and large, getting a deal these days from a funding label is nigh on impossible unless of course you are relatively high up the musical food chain. Most labels nowadays are non-funding, solely being there to supply the mechanics to get your product distributed – and they still want their pound of flesh from your sales for providing that service. The deal will most likely be an exclusive one that ties you up with them for two years, and if the label does not perform you end up in a hell of a legal fight to get out of the agreement and will most likely get fleeced financially for doing it.
So where is the money? Well, put bluntly there isn’t much (unless you are Adele, or Coldplay). Physical CD sales are not what they used to be, in fact they are not even a third of what they used to be thanks to the nature of this generation’s music fans believing that music is a free gift and they shouldn’t have to pay for it (that is a rant for later in the book). Now the real danger here to you is this; say you managed to get a funding label to back you and for argument’s sake the CD did not sell, what this basically means is at some point you will be presented with a bill from the label for all the recording, PR and promo costs (as well as a few hidden extras) . Now that is a headache you do not need.
So if physical sales are so low, how about streaming revenues? Well, these are virtually non-existent, solely because of the fact that pay-outs on that side of things are extremely poor. So ultimately why hand any profit at all over to a record label? Does the label increase your visibility from a streaming service compared to what you can do? Well put simply the answer to that is NO! They cannot do anything different than you can do for yourself, the only difference is of course you have to stump up the cash for the memberships of your chosen sales pipeline (which is not a bad thing as it then puts you 100% in control of the revenue coming from your online sales). Yes, it can be a total headache going through the online stream reports and working out exactly what you are owed (usually pence, if you are lucky) but at least it is yours, same as selling through an Amazon or CD Baby account. But like I said earlier, it takes investment to set up properly and someone in the band to manage i
Now, let’s have a look at the good stuff, the reasons why having a label is a good move.
1. Professionally it looks really cool if the band is signed to a label. A band can rarely get anywhere by doing everything themselves and sometimes are not taken seriously at all if they do not have the requisite amount of representation.
2. It is considerably less of a headache when it comes to sorting out the streaming sales figures and distribution sales figures.
3. A label has access to professional distribution points which is something you would have to set up manually yourself if you decided to go your own way.
4. Normally a label will have discounted production costs for things like CD’s.
5. And that is about that.
Now if you think you can make the most of those things by doing it yourself then for sure. go for it. But seriously consider your options. If your goal is recognition and you don’t mind taking a hit on the profit then a record label is a good way. Alternatively, if you believe that you deserve all the profits coming back to you then look into the facts about doing it yourself. But remember, it takes time to set up, and time to operate properly, especially if you are also trying to fit in a job, band practise and gigs.
But stop….wait….there is now a new option! I am setting up Skyfire Records, a label with a DIFFERENCE! Yes this maybe a shameless plug but I have seen so many bands get shafted by their labels I decided to set up an ethical, fair, straightforward record label (don’t worry no hippies were harmed during the preparation of that last sentence). With my model, 100% all the sales coming from distribution go direct to the artist, there’s no agency commission and no percentage of sales due, just one flat administration charge per year to sort it all out. Therefore taking away the headaches.
We are lucky to have some fantastic acts already signed to the label from the start and at the time of writing we are also celebrating our first new album release from the superb Iconic Eye with their brand new “Into The Light” album.
With some very well known names in the blues and rock scene coming on board over the next couple of months, the concept and model has proved very attractive to artists. So if you would like further information on this either visit www.skyfirerecords.co.uk or alternatively email me on email@example.com.
Ok shameless plug over, as you can see there are a lot of variables to consider when looking at the decision to go with a label, but on the other hand if you are prepared to put the time and effort in to work it yourself there has never been a better time to do it, with the internet making so much accessible, and with CD manufacturing companies being very competitive price.