For decades, record companies have been content to “steal” the creative products of musicians. Not only do they typically take ownership of the songs through owning the recording master as well as the lucrative copyright and publishing, but they charge the artist for the costs of production, artwork, manufacturing, publicity and anything tangentially related to the album. Prince famously wrote “slave” on his face during his lawsuit with Warner Bros. to protest this kind of treatment. But 360 deals make these old arrangements seem downright generous.
Capitol Music Group CEO Jason Flom, in one video, arrogantly justifies 360 deals by claiming that “nobody knows who they [artists] are” and “we turn them into stars.” That’s a little disingenuous, since major labels typically don’t sign artists unless they have a successful track record selling CDs and concert tickets. He laughingly acknowledges that any of today’s superstars would scoff at signing such a deal (although Madonna and Jay-Z already have). But don’t expect a new artist to get a break upon becoming tomorrow’s superstar. At best, the artist would be able to negotiate a lower percentage of the 360 deal, as attorney Kendall Minter describes in the YouTube video below.
So what’s next, your first-born son?
For more info, see the TechCrunch article, “360″ Deals Become Mandatory as Labels Prepare for Free Music.