360 deals (Major Label Rip Off Related)
LaserWolf
Portland Oregon 11,517 Posts
I might need a late pass, but I just heard about these 360 deals. Major labels are now making artists give them a cut of ALL earnings including concerts, tshirts, ringtones...
Comments
they are trying to make that happen. newer artists with inexperienced representation may make this mistake, but I don't see this as the new norm.
They paid Jay Z something like $150 Million and I think I just read he's parting ways with Def Jam now.
This is not even remotely accurate. In some situations where a deal is ULTRA competitive you may be able to avoid certain "ancillary rights" elements, or at least get uncrossed income streams coming out of giving up the other rights, but 360 deals are 100% the new norm. On top of which, even super successful artists are being approached by their labels with offers to retroactively add 360 elements to their deals.
Does anyone believe there are true positives for the artists?
The argument, I gather, is that the label will be your manager and they will be a better manager than the manager you have now.
Yeah, what IS in it for the artist?
Lots of up front cash along with a boatload of otherwise useless "synergy".
b/w
Am I the only one who thinks the guy in that poster looks like the J*sh with a bad perm???
Nothing. Seriously.
do you work for a label?
i would never sign an artist to a 360 deal.
I'm not decided as to how I feel about them just yet...but a label head did recently say something like "If a very talented and buzzed about pizza chef comes to me and asks me to invest X amount of dollars in his new pizza shop but tells me he's only going to give me a percentage of the pizza he's selling when he's making money on merchandise, renting out his space for events, etc. - well that's not a very sound investment."
Obviously, it's a tough and far-fetched comparison, but one that does ring to true to a certain extent.
I don't think the analogy the label head uses is accurate, because it is limited to the business of the pizza shop, when what he is really talking about with artists is ANYTHING the artist does they get a slice of, not just the sale of a recording. To my knowledge, if I were to invest in a friend's record store, it would be unlikely he would agree to my claiming a percentage of his DJ gigs.
No. I work for a prominent entertainment law firm. I see dozens of deal memos every month from majors and even larger indies that are 90 to 99% 360/"Ancillary Rights" deals. There's not a single building left that isn't trying to make EVERY new artist signing a 360 signing. This is not open for debate, I am speaking based on the empirical evidence that I see every day.
cool. i work for a management company that has major artists and none of them have 360 deals and none of them will.
edit - I'm not saying that it's not happening. I totally believe you are seeing 360 deal memos. I just know of many artists and management firms that wouldn't agree to one.
What if they included stock options like Terry McBride has suggested.
http://www.dmwmedia.com/news/2008/03/06/...ptions%E2%80%9D
Of course with the stuff that went down with Live Nation, I'm not sure how much that will come into play nowadayz.
That's good for them. However, if you're coming in on the ground floor and still want (for whatever unfathomable reason) to be signed to a major, even with a pretty significant buzz, but short of an outright bidding war, not agreeing to one isn't an option. What I find most interesting is how many top artists (JayZ, Shakira, Madonna, Korn, etc.) have voluntarily entered into 360 deals, no matter how well monetized those agreements might be. It's dangerous to have all of your money coming from one source.
I'm still clueless on why artists would willingly enter into such a deal however.