The New Music Distribution Deal

What is a distribution deal?

The music distribution deal use to come, and still does in many cases, as part-and-parcel of the record deal you signed with the label.

You would find a record company which would finance, manufacture, distribute, promote and handle your publicity for you. You, as the artist or creator would then earn royalties after the label recouped the costs.  The label usually owned the copyright and the master recordings.

You can see why the record deal was the Holy Grail for musicians and bands.  Record labels were the gatekeepers to the large distribution companies who were the gatekeepers to the retailers.

You had to therefore accept the fact that in order to get your CD distributed in stores, you needed a record deal. This is no longer the case because the Internet flipped the old world of music distribution on it's head, as it did for most of the rest of the music business.

Things, as you know, have changed...

Fast-forward to now and you have 360 deals, traditional deals, license deals, profit sharing deals, manufacturing deals and the self-distribution model.

Confused? I don't blame you!  I suggest you spend some time to absorb this article in which David Byrne explains the above music distribution deals in detail.  It'll all become clear, soon.

You hand over your copyrights with most deals in exchange for a range of services which include the distribution of your music.  Self-distribution is the only model where you retain the full rights over your music and other music business activities.

Now, there may be a time in your career when it makes sense to hand over your copyrights,  but this isn't something to rush into without careful consideration of the financial and legal consequences you may need to deal with further down the line.

You'll also at first find it hard to get a music distribution deal unless you already have some kind of track record of success in the business or can clearly demonstrate your commitment to promotion.

So, my suggestion to independent music producers and artists is to forget about the music distribution deal when you start out.  You can always sign one later when you have a better position to negotiate more beneficial terms.  Go direct to the potential fans yourself in the beginning and once you've built up a decent following your options and leverage will increase.

You can use various music distribution companies to handle your online and offline distribution.  You can sell music from your web site and at shows, you can directly approach local stores and retailers.

It's great to have a team of people working to further your career. If it's not possible to have this,  or you prefer doing things your own way and keeping control of your business, then the self-distribution model is now not only possible, it makes a whole lot of sense.

Record label distribution without a record deal...

In the past...

... record label distribution was a big deal.  It was in fact one of the reasons the record deal became the holy grail for any aspiring musician.

Most distribution companies worked only with labels and not with artists directly.

You either signed with a label or worldwide distribution was out of your reach. Lucky for you and me,  those days are gone.


Fast forward to today and...

... we "ain't in Kansas anymore, Toto"!

You probably know by now that you as an artist or music producer can distribute music worldwide without the need for major label distribution deals.

You're most likely also aware of the digital music distribution companies you can use to get your music on iTunes or other online music marketplaces and retailers such as Amazon and Spotify.

Yes, the big four (big three yet?) music groups and the labels they've gobbled up can still get you into physical stores you'll have a hard time getting in yourself.

They can get you into those CD stores which are closing down all over the place, or the other stores which are selling DVDs and console games to stay in business.

Remember: Less and less people are buying CDs and more are buying digital downloads. Do you really need a traditional record label distribution deal?  I say no,  you don't.

You also have options for your physical distribution. For instance, at the time I write this both CD Baby and Amazon offer you this option.

So,  there's no need for a record label distribution deal when you have so many options at your disposal to self-distribute your music. You can get pretty much everywhere the labels can get without having to sign that 360 deal of death!

The great thing about this is that you can now start you own label,  keep your creative integrity, your rights, your masters, your business equity and profits and get your music straight into the places where your tribe spends money through self-distribution.

That all said and done, there is a time and place where a record label can be of benefit.  In fact,  you won't become really big, like top 1% big without the help of a good label.  Still, if you don't have any momentum built up then most labels won't even give you the time of day.  So, start off with the independent distribution route, even if you plan to eventually take over the world.

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