Industry news & advice blog

There can be a lot of jargon surrounding record labels and recording contracts, so let’s clarify a few terms you may stumble across in relation to the recording industry. Don’t be stumped any longer!

 

 

Advance – A sum of money paid upfront to an artist when they sign a recording contract. Getting a large advance may seem like all your dreams have come true, but bear in mind that advances are recoupable i.e. the record label has given you a loan of sorts. As soon as your release starts selling, the advance will be claimed back from the sales revenue.

 

BPI – The British Phonographic Industry is the representative body for the UK recording industry. They spend their time combating fighting piracy, promoting British music and generally making life easier for the nation’s record companies.

 

Copyright – Copyright is the ownership of something you’ve created, allowing you to protect your works. It gives you a say in who copies, broadcasts or distributes your work and ensures you are credited for your creation. In the realms of record deals, you will typically hand over the copyright of your songs to the record company when you sign a recording contract. So as you’ll be handing over control of what happens to those songs, be sure this is definitely what you want to do before signing on the dotted line! 

 

Exclusivity – A word you are likely to come across when signing most agreements in the music industry. In terms of a record deal, exclusivity mentioned in a contract means that you will record exclusively for the record label in question during the length of the contract, and not put out releases under any other label.

 

 

Independent/indie Labels – An independent record company, or indie label as you may know it better, is a record label operating on its own independent funding. An independent label can range from the very small, run out of your bedroom types right up to the large-scale candidates such as XL Recordings, Domino, Rough Trade and Ninja Tune. The main difference between signing a deal with an independent record label as opposed to a major label is that typically the sales revenues are split more equally with some being agreed at 50/50 between the label and artist.

 

Major Labels – Sony Music Entertainment, Universal Music Group and Warner Music Group make up the 3 major record labels, These labels are also made up of many smaller, specialist subsidiary labels – read more about those below.

 

Mechanical Royalties – Royalties are split into 2 types: performance and mechanical. As defined by PRS For Music, ‘Mechanical royalties entitle you to earn money whenever a song or composition that you have written is reproduced. This includes when your works are recorded onto a physical product (such as a CD or audio-visual product), or listened to or downloaded off the internet.’

 

PPL – PPL are a collection society; they collect royalties for recording artists and record labels and pass them on. They do this by licensing recorded music that is broadcast in public, collecting the money earned and distributing it onto whomever owns the copyright of the recordings.

 

MCPS – This stands for Mechanical Copyright Protection Society and, similar to PPL, they also gather and distribute royalties earned for music that is copied as physical products, such as CDs and DVDs, streamed or downloaded, or used in TV, film or radio Now under the PRS For Music umbrella, you can find more info about MCPS here.

 

Recoupable – In short, this means repayable. So every time you are offered a recoupable advance, whether it be as part of a record, production or publishing contract, this money will be collected back from the revenue once you start selling music. Once an advance is recouped in full, you will then start making money yourself. To be 'unrecouped' under a record contract means that the artist has received an advance, but has not yet earned monies equal to that advance.

 

Roster – When a record label refers to their roster, it is the roster of artists and bands that they currently have signed to them and are working with.

 

Subsidiary Label – The major labels are made up of many smaller subsidiary record labels which operate under the same umbrella. For instance, Columbia Records is part of major label Sony Music Entertainment. Other subsidiary labels within a major may include specialist and genre specific divisions such as Sony Classical Records.

 

Term – You will spot this word amongst most contracts, not just limited to the music business. It refers to the length of the agreement.

 

Territories – Another recording contract related reference, territories refer to areas of the world that your contract applies to. Some record labels may sign an agreement with you for a particular territory, say United Kingdom or Europe, and this then allows you to enter into other recording contracts for different territories such as USA, so your music can be released there.

 

Unsolicited demos/submissions – You have probably come across the sentence ‘Do not accept unsolicited demos’ in your time and may feel unclear; do they accept music submissions at all? Yes, they do…but only demos they have asked for. So unless the record label hears a buzz about you and requests some music to be sent onto them, or you have a good manager who can get your foot through the door, there is little point wasting your efforts on submitting material. Harsh, but true.