The music industry is controlled by secret societies within major record labels, distribution companies, and other key media entities. The system is rigged, and most emerging artists are unaware of the realities of this business. This is why artists eagerly sign deals, only to regret it later when they are exploited as mere products. Ever wonder why many artists die soon after gaining fame? A celebrity’s death means increased revenue for record labels and publishing companies. Once you sign a deal, you essentially sell your soul and become a disposable pawn. Mainstream artists may appear happy on screen, but behind the scenes, they are often miserable. While being independent has its challenges, it is ultimately more rewarding.
When you sign with a label, they take 80% to 85% of your intellectual property as they handle all business aspects of your career, leaving you to focus solely on the creative side. Here’s how it works: The label acquires a beat from a producer, who owns 50% of the publishing royalties and mechanical rights by default. This leaves you with 50% of the publishing. Additionally, the producer gets 25% of the artist’s sales earnings, so if you make $200 in sales, the producer takes $50, leaving you with $150.
If there are two featured artists on the track, each gets 12.5% of the song, leaving you with 25%. However, these percentages can be negotiated based on your arrangements for video costs and marketing fees.
So, if you earn $200 from publishing:
- $100 goes to the producer for the beat.
- $100 goes to you.
- The label takes 80%, or $80, from your share.
- You are left with $20.
From your $20, you must pay your manager their 20% fee, which is $4. This leaves you with $16. Additionally, you still need to cover costs for your image and music video.
This explains why artists from labels like Ambitious Entertainment are often unhappy. Record labels operate on 360 deals, taking a share from all revenue streams—touring, merchandising, and more—in exchange for their investment in launching the artist’s career. The label prioritizes its profits, leaving the artist financially struggling and distressed.
Going independent means you keep all your earnings, but you must manage all the administrative tasks yourself unless you have support from organizations like Creatives Makhado. Independent artists might not achieve the same rapid success as those signed to labels, but they avoid compromising their values or engaging in extreme behaviors to maintain a lavish lifestyle.
