RIAA Math: Sell 1 Million Albums, Still Owe $500k

An anonymous reader writes "For all the complaints from the RIAA about 'pirates,' who are the real pirates in this scenario? Through a variety of contractual tricks, it's nearly impossible for artists signed to major labels to get paid. The article and video detail how an artist who thinks he's getting a 10% royalty is actually getting closer to 2.5% through various tricks placed in the contract. The labels, then, end up with 97.5% of the gross revenue, and anything they 'spend' on the artist continues to come out of the royalties, not the labels' cut."

Comments

The rise of indie

[theillien]

With the ability to distribute online so easily these days, I don't know why artists even bother with major labels anymore. I'm sure with a little investment even the smallest artist can attain a decent marketing campaign. Word of mouth and social networks are a wealth of free publicity as well.

Re:Shysters all

[mooingyak]

If these contracts are known for being so bad, why do people continue to sign them?

Lets say 95% of people are smart enough not to sign one. If you work for a record company, it means you only sign up people who fall in that 5% category. The pool of people who could actually make money for them will always be large enough that they can afford to ignore the rest.

And it gets worse. Let's say I started a record company today, and I genuinely want to do right by my artists. If I don't employ the same money squeezing tactics that the existing labels do, then my margins suffer and the only way to succeed is to have a much higher success/flop ratio with the acts I sign than everyone else. And that's not trivial to pull off.

Re:Shysters all

[jawtheshark]

With all due respect... Are you implying that you are entitled to make money with what you love doing? I assure you that's not even remotely close to how reality actually works. Most people have a day job that they either accept as "necessary" or flat out hate it. Many people, including me, used to love what they did, but the realities of the workplace and business requirements usually put a halt to that. My dad always used to say, "Find a job you love and you'll never work in your whole life". As a matter of fact, I have a corollary to that: "Find a job you love, and lose your love for it". Yes, I still love programming, fiddling with hardware (e.g. dumpster diving), helping out people with their computer problems, but it's for my own and for the people I care about. My job, is just that... a job.

What about the people who love things like D&D or simply going for a walk in the forest? Should they be able to make money of it? Sure... They should have the right to attempt that, but reality will kick your butt quickly.

My wife would love to make her money with her paintings. She's pretty good, but to make a living out of it? I'm doubtful, may happen, but only if someone rich actually fancies her art and gets her out in public.