Finally, you did it. You noticed talents and want to get what looks like life for your record label. But before you sign the new musician on, make sure both of you understand what you sign so that your visions of fame and riches don’t become a cautionary thing.
Before letting the musician sign the recording contract, you should make the following considerations.
Have a Record Label and Loyalty Payment Audit
Artists also need to know how they can guarantee that the mark with the total number of albums or tracks sold is truthful. The relationship between you and the artist can quickly become contentious without honest contact and accurate recordkeeping. This form of contact breakdown is best prevented through an independent audit.
The traditional audit arrangements allow the artist to employ a third-party auditor to read and check the records books and ensure that you pay them what the music producer agreement requires.
Music Producer Agreement That Lasts More Than a Year
The initial contract term is typically 1 year. In general, there are several optional periods followed for this one-year term when you can extend the contract for more periods if the musician likes it.
Note that musicians avoid a record label that monitors their life and artistic work for an unfair duration by reducing their time spent on your contract to a year without choice periods.
You never know the future of your record label, and keeping your options open is crucial. Locking the artists into long-term contracts can harm their artistic life and financial future.
Therefore, your musician will most likely confirm that your record company does not lock them into a lengthy deal before signing this contract.
Musicians Will Need A Reasonable Royalty Rate.
While the royalty rates vary significantly from an artist’s reputation and popularity, there is an overall royalty rate ball-park number for every artist. A royalty rate of five to 10 percent is common for emerging artists with little to no reputation.
New artists usually see a royalty rate of 10% to 14%, whereas experienced artists will receive up to 18% royalties.
Artists will not let you persuade them that an industry norm is one or two percent royalty. Certain record labels are prey to unsuspected artists through their comparatively large premiums that give their artists an initial sense of success.
In exchange, however, the deal grants the artist a mixed royalty amount, ensuring the label – and not the artist – receives all the creative success for the long-term.
In general, this kind of audit is payable by the artist. However, many audit provisions demand that if there is a significant gap, the audit is paid for by the record label.
It is always a good idea to employ competent legal counsel before you sign a new artist in your record deal to evaluate the proposed contract on the record label. However, given these tips, you can now see if you have the potential to nurture the artist’s creative skills.