Join Richard Stim for an in-depth discussion in this video Paying the manager, part of Music Law: Recording, Management, Rights, and Performance Contracts.
- The Management Agreement provides for the…managers payment, known as a commission.…This is expressed as a percentage of revenue…after deductions, usually 10 to 15 percent,…and occasionally as high as 20 percent.…Management agreements usually state…that the commission will be taken…from the artist's gross income.…The use of the term "gross income" is misleading…because it implies income before any deductions,…while the management commission is…almost always calculated after deductions are made.…
Keep in mind that the more that is deducted…before the manager calculates the commission,…the more money the artist keeps.…In other words, it's not necessarily the size of…the commission, whether it's 10 percent…or 15 percent that matters.…It's possible, for example, that a 10 percent commission…with no deductions may sometime result…in smaller payments to an artist…than a 15 percent commission with many deductions.…
So, what should be deducted before…the manager gets a commission?…Or put another way, what is commissionable income?…
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