Join Richard Stim for an in-depth discussion in this video Deductions, part of Music Law: Recording, Management, Rights, and Performance Contracts.
- You've heard the expression,…"There's no such thing as a free lunch."…In the music business, that is literally true.…Artists are often surprised to find that the cost…for the complimentary sandwiches and beverages…provided at a record company reception,…later mysteriously appear as an expense…on the artist's royalty statement.…Welcome to the world of deductions,…sums that are subtracted from the artist's paycheck.…These deductions are always expressed…in the record contract,…usually in the Payments or Royalties section.…
As you're probably aware, royalties are…calculated by multiplying the artist's percentage…or points against the incoming revenue.…Deductions may be subtracted from the…incoming revenue before the royalties are calculated,…or in most cases, they're deducted…from the royalties after they're calculated.…The timing makes a difference.…Deducting it before calculation…is always better for the artist.…For example, consider an artist with a 12% royalty,…whose record generates $100,000 in revenue.…
The record label claims $10,000 in deductions.…
For example, when it comes to record contracts, it's important to know how advances and royalties work, how to maintain creative control, and what happens when a member leaves a band. Rich also tackles management contracts, describing what managers can do for you—and what to do when you need to let them go. Next, he explores the basic terms, riders, and payment options in performance contracts. Then learn about releases, artwork permissions, publishing and producer agreements, and other types of legal arrangements. Rich wraps up the course with a discussion of oral agreements, attorney fees and roles, and five basic rules worth remembering for every music contract.
DISCLAIMER: This course is taught by an attorney (or other instructor) and addresses US law concepts that may not apply in all countries. Neither LinkedIn (including Lynda.com) nor the instructor represents you and they are not giving legal advice. The information conveyed through this course is akin to a college or law school course; it is not intended to give legal advice, but instead to communicate information to help viewers understand the basics of the topic presented. The views (and legal interpretations) presented in this course do not necessarily represent the views of LinkedIn or Lynda.com.
- Why bother with a contract?
- Understanding terms, options, royalties, and deductions
- Making provisions for marketing
- Including warranties and indemnity clauses
- Hiring a manager
- Understanding performance contracts
- Getting permission to use samples
- Creating a band partnership
- Record keeping
- Going through mediation or arbitration