How Do We Get Paid?
February 29th, 2008no comments
Today I (Luke) attended a music business seminar at Greenville College (where I teach drums) and it made me realize that a lot of people don’t understand how artists and bands make money (or don’t make money), and all that is involved in that. Unfortunately it isn’t as easy as, record a cd, sell your cd to people, keep the profit. Sometimes it can be, but the bigger an act gets, the more complicated things get, and the more hands are stretched out for a piece of the “pie”.
Here’s one example of how the money flow may happen, but lots of situations are different. First of all, depending on the artist, they may or may not write their own songs, or at least a few of them. In genres like pop, and country a lot of the songs the artists record were written by teams of songwriters. But genres like rock, and hip hop, usually the artist writes the song. If you are using other songs, a songwriter will give his or her songs to a publisher, usually they are employed by a publishing co. From there, the publisher decides to “demo” the song, and make a rough recording of it. This is the first of the costs. Then after completed the Publishers job is to try to get that song demo into the hands of established artists who may want to “cut” or record this song on their album. So now, you have a songwriter who owns part of the song rights, along with his or her publishing co. who owns part of the song, who just passed it along to an artist who will be making money of the song as well. Already, you have 3 people splitting of profits from 1 song. But the list doesn’t stop there. Most times a producer will be involved in the recording process of the song. In a round about way, the producer receives a cut of the money that song makes as well. Also, in the large scope there is a record company funding alot of this work, who expects to see return on their investment and ownership of the material as well. Often times this leads to the artist touring to promote these “songs”, which includes booking agents, who get a piece of the pie. This also usually involves an artist manager to coordinate all this stuff, and represent the artist. Of course, the manager is guaranteed a percentage of everything the artists makes as well.
This sounds like a mess, but there is much more too it. There isn’t necessarily 1 big pot of money that everyone grabs from. The money is distributed separately from liscensing, royalties, merch sales, live performances, and so on. But the idea is….. from 1 piece of creativity, a multitude of people reap the rewards. Every situation is unique in who gets how much, but it’s mind blowing for some people to realize all the places the money goes. So next time you’re sitting there thinking,… ” Man, (fill in artist name) must be just rolling in the cash, from all the tours, and cd sales, and radio plays”…. well, I would wager the numbers are huge, but only a small percentage of it is actually getting back to the artist. Don’t get me wrong, there are plenty of rich performers out there, but all I’m saying is there are plenty of very rich non-performers out there, thanks to that artist.
Hope you enjoyed that little segment on how to not make money…. it’s enough to make you want to go to mechanic school. not really.
