What Is A 360 Deal
A 360 deal with a record label is also known as a multiple rights deal.
This is because the 360 deal with the record label gives them the rights to make money from multiple areas of the music artist’s career. I’ll explain everything a record label can take from a musician with a 360 deal in this article.
What Is A 360 Deal Explained Video
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The History of The 360 Record Deal
I’ll tell you why it’s like this now and why labels would literally wither away and die off if these didn’t exist.
Music industry record labels have been building and growing since the early 1930s. Some of the biggest labels you see that exist today were created an incredibly long time ago and were able to survive back then strictly off of sales of music.
After all, when there are less than 100 artists in the world those are the only options to listen to. Therefore those are the only options people can buy from.
Therefore those 100 artists are going to be selling to the entire population which results in millions and millions and millions of record sales.
Which results in 10s of millions of dollars from music sales to the label.
Record Label Music Sales Before The 360 Deal
Recorded music generated almost $15 billion in revenue in 1999, but that dropped to more than half at $7 billion by 2012.
And with inflation that is absolutely crazy. It’s more like it dropped almost 75%.
This was all money labels can no longer receive from music artists signed to their record label which is exactly why they need 360 deals in 2020.
Now with MILLIONS of artists and too much to choose from, we need to be able to stream anyone’s music we like anytime we like. There are too many options to just go buy 1 Album from someone.
It used to be labels only took your money from music sales, CD sales, Cassette Sales, Vinyl sales, and all of that.
But that all changed with the growth of the internet, being able to steal songs using Napster and then file sharing sites and then later torrents.
What Does a label get in a 360 Deal?
So as sales of the actual music decreased because of piracy labels wanted to make sure they could maximize their profits. To do this they had to start taking a piece of everything else so they created multiple rights deals or 360 Deals in music.
It gives them a 360 Deal that gives them the rights to make money from multiple pieces of a music artist’s career such as the following.
- Digital sales
- Tours, concerts, and live performance revenue
- Merchandise sales
- Endorsement deals
- Appearances in movies and television shows
- Songwriting, lyric display, and publishing revenue
- Ringtone sales
If you start a business while signed under the label they could own a percentage of that too.
What is a 360 deal in music worth to a record label?
Now this is the big question, right? How much money do you make as a serious sized music artist who is touring and really making money? Then how much is the record label going to take from you if they have you signed to a 360 record deal?
Let’s go over how much all of those are worth really quick to an artist
Artists make the most money from tours. If you are a mid-level artist making $10,000 per show and you do 300 shows a year, that is $3,000,000 that would have been yours to keep. Instead, a HUGE chunk of it goes back to the label.
When you do shows, you actually make even more money, let’s say $5,000 in merch sells a show, that’s another 1.5 MILLION a year they get to take from you.
We are already at 4.5 MILLION DOLLARS you have to give a big piece to the label if you are in a 360 deal with a label as a mid-level artist.
I’m not even going to go into the rest but imagine you make 10 Mill a year total… they are eating good off of you FOR A LONG TIME my friend
Who Do Record Labels Sign To 360 Deals?
They used to be a lot pickier when it came to choosing who they sign.
If they could only make money from your music itself, they wouldn’t be able to sign any artists.
Now with the 360 deals, they can sign 20 artists and give them a decent-sized deal, and if one of those artists blows up, they are able to make all of their money back with no problem.
Labels need a 360 deal to profit from artists.
Sucks for the artists who don’t want to go out and hustle on their own and think that a label is a short cut.
What you don’t understand is how many 100’s of artists are signed to every major and subsidiary label that are just sitting on the shelf with NO fans.
They get signed, but when they don’t make the label money, they just tell the artist to go stand in a corner. They don’t fund their next album, their next tour, or add any marketing dollars to their project.
Therefore an artist is in a label deal they can’t get out of and they aren’t even allowed to release music on their own without permission or they will get sued by the label.
This is like putting an artist into a cage they can never escape all because their first try and project they attempted to push didn’t move forward.
Be very careful with wanting to sign to a record label. It’s a business and businesses are made to make money. If you are not making them money, they will not be your friend.
360 Deals vs Regular Deals or Old Label Deals is a whole other story. Unfortunately, they don’t tend to do those kinds of record deals anymore. You can always hope for a great music distribution deal though. Those are pretty common and a lot better option over a 360 deal if you have the right amount of buzz to get a good one.
Keep hustlin gang, I’ll see you at the top.
Don’t forget to check out my Spotify. I’m boomin!
– Rob Level