contractHow many cars have you purchased without reading the title agreement?

How many apartments have you rented without knowing the terms of the lease or how much you would pay in rent each month?

If you have any common sense, the answer would be none. Kind of a no-brainer right? You’d think so.

In the last two years, I have seen a disturbing trend on the upswing where Independent Musicians are signing everything they can get their hands on, if the promise is instant fame. Want a record deal? Sign here. Licensing opportunity? Give us your John Hancock. Audition for American Idol? Wait…what?

That’s right folks, no opportunity in the music Industry comes without terms of services. There IS a contract. Not only are musicians unaware that when they agree to audition for reality TV shows, they are giving away the farm; they aren’t even reading Recording Contracts before signing them.

Think about it for a minute: you have worked for years, writing, recording and doing every lousy bar gig that you can find…but you won’t bother to read a contract that could hold the future of your music career hostage?

I see it every day: musicians desperate to say they have a “label deal”…or  make it big by winning American Idol, so they throw all caution to the wind and never give it a second thought. Until…they suddenly owe their life savings to a Record Label (who dropped them), or to an entertainment attorney (trying to bail them out of a rotten deal).

Let’s start with Major Label recording contracts. Rare to begin with, and even rarer to get one that actually gives you promotion, support and doesn’t rape and pillage you in the process. There are about 12 million Independent artists out there all thinking they are going to get signed to a Major Label. Even if you happen to be the one in a million or one in 7 million, it will probably be a form agreement which is a totally one-sided deal; NOT in your favor. You build the giant fan base, get the machine running like a top and then the label swoops in to take their 40%. Sweet Deal. Then, when your record doesn’t give them enough profit, they drop you and send you the bill for the million dollars they spent making your record.

In other words, you signed a really bad loan agreement without reading – or understanding – the paper it was printed on.

I have personally worked with dozens of artists who are thousands of dollars in debt to entertainment companies, managers, record labels, and yes, even Reality TV shows; because they signed contracts that they either didn’t even read or didn’t take to an entertainment attorney. Why? Promise of fame and fortune and because, “I couldn’t afford it.” Yikes. Sobering.

There honestly is no shortcut no matter how you slice it. I was thinking about the massive success of Adele last night when it hit me that she started on a small label, Beggars Group; whose XL label signed Adele in the UK and actually took the time to develop her properly. In 2011, independent record labels sold 23.5m albums in the UK, helped by Adele’s success. Together they ranked second to Universal, which notched up 30.9m album sales, and far ahead of Sony, which sold 18.2m. XL had $181 million in revenue in 2011, up about 400 percent from the $36 million it reported the year before. The label had $66.9 million in operating profit (before taxes), and ended the year with just less than $60 million in cash. Martin Mills, the chairman of Beggars Group, has stated that 25 million copies of  ’21’ have sold around the world, “and when you sell that many records everyone makes money. Not just Adele and the label, but distributors, retail, everyone.”

Elvis Presley, Prodigy and Oasis all started with small labels. But they all developed something amazing, and the market was open enough to allow them to bloom and flourish.

The Majors have zero interest in developing artists. They’ll be happy to take your 40% however.

American idiotNow what about American Idol, the Voice, America’s Got Talent and any other TV Reality shows that promise you the road to stardom? I’ve seen those contracts and quite honesty, I can’t believe that anyone signs them. One example:

I hereby grant to Producer and its successors, licensees and assigns, without charge or other compensation, the irrevocable exclusive right, but not the obligation, with or without my knowledge, in perpetuity and throughout the universe, to film, tape and/or photograph, perform, record, exhibit, display, edit, distribute, sell and otherwise use my appearances, name, likeness, voice, singing voice, conversations, sounds, signature, biographical data, and any information or materials provided by me to Producer (including, without limitation, any video or sound recordings I provide in connection with the casting process) in and in connection with and ancillary to the Program or otherwise in any and all media, whether now known or hereafter devised including, without limitation, in the Program, motion pictures, television, on the Internet, publishing, and recordings, and in and in connection with the advertising, sale, promotion, marketing, merchandising (including slot machines), distribution, publicizing and all other types of exploitation thereof, or in any other manner whatsoever in Producer’s sole discretion or to refrain therefrom.

Producer shall also have the unrestricted right to edit the content and text of any recordings of the casting process and any video and sound recording and other materials I submit in connection therewith, as well as the Program and all film, tape, photography, recordings and my appearances thereon, in any manner or form. I further agree that Producer is the sole owner of and may freely assign all results and proceeds of such film, tape, photography, recordings and my appearances thereon.”

Head exploding yet? That’s just one part of one paragraph. Key words include “in perpetuity”; for an indefinite period of time; forever. 

Forever. Clear enough? They can use your image, music, likeness, etc. any way they like…forever. That doesn’t even cover what you are NOT allowed to do concerning working with third parties, etc. And…these contracts are sometimes required even if you don’t make it past the first cattle call!

Reading and understanding any contract offered to you is business 101. And for God’s sake, hire an entertainment attorney who understands the music language and can help you negotiate a deal in your favor. Don’t end up being one of the thousands of sad stories about musicians whose careers were stopped cold before they even started, just because it was too much trouble to read and understand terms of a contract. Even if you DO happen to be the one in several million who gets a once in a lifetime opportunity, you have to do your due diligence in retaining a great attorney, negotiating the contract and being willing to sacrifice some of what you really want in order to make the deal work.

Guess it’s not a shortcut after all.

4 Responses to Have you signed your life away?

  1. Broome says:

    AMERICAN IDOL IS NOTHING MORE THAN A GLORIFIED KARAOKE CONTEST.

  2. Jen says:

    Thank you for point this out. Wow; the record labels look worse than the used car dealers and high rate lenders. At least my mortgage company would have let me keep my clothes when they kicked me out of my house.

  3. Shecky says:

    Wow, that is a real eye opener. I could not imagine losing something I have always felt could not be taken. I would rather eat ramen noodles and hot dogs while enjoying my craft rather than settle for the immediate glory.

  4. Peter Frank Santovito says:

    Ghezzi and friends, This is absolutely true. I went to audition on ‘America’s Got Talent’ and when I read the contract I said there is no way in the world I am signing this!…when I called NBC a producer and I spoke. I asked her what happens if I don’t sign the contract? She said then you won’t be on the show! Definitely hire a music attorney BEFORE you sign…

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