It is not news that in the 21st century artists don’t need to be signed to a label to produce and release music and be successful. Nowadays, it is more than enough to build a home studio to record music and work on it on your own. Even though it might be true and the quality of the recording track won’t be worse than if it is recorded in a professional studio (in fact, many famous artists such as Ariana Grande recorded some music at home during quarantine), this is definitely not the reason why an artist shouldn’t sign to a record label. It should be justified with many other reasons.
There are three options for an artist to choose its way – get signed to a major label, indie label or pursue the dream by being an independent artist. Let’s break it down.
Major Labels Pros
First, major labels. Major labels are the biggest labels in the world, which include many other sub-labels and have their own publishing and distribution companies. Everyone knows three major labels or “the big three” – Universal Music Group, Warner Music Group and Sony Music Entertainment. Obviously, being international companies with offices all over the world, major labels have its pros, such as:
1. Internal and external connections
A major label has teams of professionals in all necessary aspects internally (publishing, marketing, A&R, producers, writers, etc.) as well as connections outside of the company – radio, movies, streaming services, and TV shows. In the process of working with a major label, an artist can meet lots of people and connect with them for future opportunities with or without a label. It is all about relationships and communication which can play a crucial role in the future, and being signed to a major label, an artist is given an opportunity to make these connections.
2. Wide visibility
There is a common believe that once an artist is signed to a major label, it is only a matter of time when he or she becomes famous. And there is a reason for that – A&R Managers don’t sign an artist if they don’t see talent and potential for money-making. However, like everywhere else, there can be situations when an artist gets dropped by a major label. To achieve international fame with a major label is faster, but no one gives 100% guarantee that it will actually happen.
3. Budget
The biggest strength of a major label is its huge “bank” and opportunity to invest money in an artist’s music, promo, marketing, etc. Signing to a label like this, an artist doesn’t have to worry about budget – the label will spend its funds on a song, album, video, artwork, visualizers and everything else that needs to be covered for a release.
4. Big and professional team
No need to say that people working in major labels are experienced professionals with a number of years in the industry. For instance, according to the recruiting websites of Warner, Sony and Universal Music, there is a requirement of having at least 5 years of experience in the field, applying for the position of an A&R Manager. Moreover, imagining how competitive it is, only outstanding talents can make it through.
Once an artist is signed to a major label, not one, two or even three people are assigned to the project – professionals from different departments will be responsible for the artist development (marketing, licensing, sync, publishing, public relations, distribution and much more).
5. Reputation and status
People can love or hate major labels but the fact stays the same – being signed to a major label gives a status. It puts an idea in people’s heads that an artist is talented because even such a huge label, filled with top professionals, has recognized this and it means a lot. Also, no need to forget that it affects other people’s reputation too – working with an artist, signed to a major label, they can confidently say that they partnered with this major label. Having this “tag” under an artist’s name can bring many more “yes” and opportunities.
Major Label Cons
As good as major labels are, they still have such disadvantages, most of which are known by the general public. The cons of being signed to a major label are:
1. Rights of master recordings are owned by a major label
Every time someone says “major labels control everything and then leave artists with nothing” they might not even know, but they refer to this point. In the most common case of signing a contract with a major label, an artist will have to give up on master recordings, which means that even if the artist stops working with the label, the major will always be a co-owner of the songs it owns, decide where to license the music and receive half of the royalties. Only big stars can negotiate this point.
One of the scandals regarding this issue happened with Taylor Swift and Big Machine Label Group. According to Sam Sodomsky, Ithaca Holdings (Scooter Braun’s investment company, which includes his management company SB Projects) bought Big Machine, that contains master rights for six albums from Taylor Swift. As Taylor claimed, before leaving the label (and before it was sold), she was given an ultimatum – if she wanted to receive the master recordings for the previous albums, she would have to turn in new albums. However, the singer didn’t agree to that and signed a contract with Universal Music Group/Republic, which offered her to keep master rights for new releases. When Big Machine was sold to Ithaca Holdings, Taylor didn’t accept the fact that her master recordings will be used by Justin Bieber’s manager, and said that she wasn’t even notified about the selling to have an opportunity to buy out the label. In her open letter, she wrote, “Hopefully, young artists or kids with musical dreams will read this and learn about how to better protect themselves in a negotiation. You deserve to own the art you make.”
2. Decision-making is not always up to an artist
In addition to what was mentioned above, a label has a right to license an artist’s music for a movie even without his or her permission and it can be justified by a label just doing its job, trying to make an artist famous. Same can happen with a marketing rollout, touring and even creative freedom – in some cases, an artist can be told what type of music to create.
3. Big commission
The bigger an organization, the more it takes. Major labels don’t split revenue with an artist as partners, it takes a bigger half. According to ASCAP, signing to a major label, the artist will be left with 10%-25% of royalties and everything else will be taken by a major label.
4. Commitment
Signing to a major label, an artist commits to work and agrees to be a workhorse until a contract expires. And even though it is mentioned as a disadvantage, just because an artist loses its “freedom” and “deadline flexibility,” it is not necessarily an unfair point. On the other hand, it can keep an artist in “a good shape” and take his or her career seriously like never ever before. However, it is advised to watch out for long-term contracts – major labels can try to make an artist commit for a long time to get as many albums as possible in a specific period of time.
5) Advance recoupment
Major labels can be generous enough in the beginning but it will always make sure to get its money back, which is, again, not necessarily unfair. As it’s confirmed by ASCAP, not only will an artist have to pay out an advance, but also expenses for promo, marketing, etc. – everything the label spent on an artist and its release. Think about it as an investment – label invests in an artist, waits for him or her to break-even and then keep collecting interests from its investment. Yes, it takes time for an artist to see his or her first money because the first profit is collected by a major label until it breaks-even and only then the artist will be paid. As cliché as it can sound, but it’s just a business.
Conclusion
Think why major labels still successfully exist and are so respected in the industry, no matter what disadvantages it has. Why do such artists as Lady Gaga, The Weeknd, Justin Bieber, Ariana Grande and many other huge names still work with major labels, even though they have every opportunity to create their own indie labels or just go independent? With the amount of connections and fame they already have, it wouldn’t be an issue or a worse choice. Why does The Weeknd have his own label, XO Records, but it is a sub-label of Republic Records (which is owned by Universal Music Group)?
There can be a lot of rumors and real stories about how cruel major labels are to up and coming artists, but if the artists, mentioned above, keep renewing their contracts and working with the labels since when they weren’t popular, then there is definitely a good reason for that. If an artist wants to achieve international recognition and is actually ready to take its career to another level, then a major label is for him/her.
Major labels offer huge opportunities and new doors for an artist, but… there is always “but.” Best thing an artist can do, reviewing the possibility of working with a major label, is to read a contract carefully and negotiate about the points that sound suspicious. After all, whatever an artist is offered, it is his/her choice to agree or walk away.
Indie Labels Pros
Some artists need more freedom and cannot tolerate what a major label takes away with the possibilities it offers. Therefore, here comes indie labels.
Indie labels are those that aren’t included in the big net of major labels and which work independently. It is, obviously, smaller than a major label, but still has a lot to offer:
1. “Artist friendly” environment and creative freedom
Indie labels don’t intrude in an artist’s music creation, giving a freedom to write and produce what he or she wants. An artist can be consulted or guided if it is needed, but no one tries to take control over.
2. Partnership deal
In most cases, in indie labels artists are considered as partners. Therefore, they are treated the same way – an indie label agrees to about a 50/50 royalty split, though the exact splits will depend on the label and deal.
3. Release of master recordings rights
Independent labels take master rights from an artist, but in contrast with a major label, it usually releases the rights after a few years since an artist stops working with the label. However, it doesn’t always happen as it is mentioned and varies depending on a label and its proposal.
4. Connections
Like any other company, external connections of an indie label increase with time – it wouldn’t be able to function properly if there was no connections in the field.
5. Team and consulting
As major labels, indie labels also assign a team to an artist. The only difference is in the number of people it includes and their professional experience (which is not always the case). Apart from that, an artist can always get consulted about whatever he or she needs – whether it is guidance in music production or execution of ideas.
Indie Label Cons
Before signing with an indie label, take into consideration the cons it has:
1. Limited budget
An artist should understand that an indie label won’t be able to cover an artist’s expenses even upfront. There is a team of people who are ready to help an artist to come up with release strategies or promo, but if an artist wants to create a good music video or make a creative marketing campaign which requires a budget, then he or she will have to invest own money.
2. Size
The smaller a label, the smaller connections and its influence. As much as professionals working in an indie label would love to do for an artist, it is physically not possible to cover the same amount of opportunities and work as major labels.
3. It can take time to get noticed
With a budget and connections a major label puts in an artist, the outcome of becoming famous can be expected much earlier than in an indie label. But it’s important to not forget about luck, momentum and the fact that an independent label is most likely to pay more attention to a signed artist, if it would be in a major one where there are much bigger stars and they are a priority.
Indie labels are a good option for those, who don’t want to pursue “international fame” in the first place and ready to take it slower. It doesn’t mean that an artist will never be on the same page with those who are signed to a major label – an indie label, XL Recordings, is a perfect example for that. The company helped make famous such artists as Adele, Radiohead, M.I.A., Vampire Weekend and Tyler, the Creator – the names that have crossed oceans and are known worldwide.
Conclusion:
To sum up, indie labels have everything that artists need in terms of a label team (which is not related to management in any way), help and support, while its visibility is not enough for those who want to become famous as fast as possible. However, even indie labels might not be an option for artists who don’t like the fact that “middle men” are included.
Being Independent
For such ambitious artists, there is an option to stay independent without a label.
Advantages of being an independent artist are:
1. Maximum creative freedom & control over decision-making
Independent artist is on his/her own and can do whatever he or she wants and how he or she wants.
2. Maximum profit
No label – no need to split profit received from music with anyone else but yourself (until an artist has a management).
3. The only copyright owner
Choosing a path of independence, an artist owns and has all his music rights in full.
Being Independent Cons
In this case, it is safe to say that an artist is its own producer in all aspects. And for such freedom, the price should be paid with:
1. Money
Having freedom and being independent, means to pay for everything that’s needed.
2. No connections
Even if an independent artist has people who are ready to help, it cannot be compared with connections of an indie label, not even mentioning a major label.
3. No label team of professionals and guidance
While working with a team of professionals, an artist not only can get guidance but actually be advised about what distribution platform to use will be financially better, as well as getting help with licensing, sync and publishing. An artist will have to dive into all these specifics and learn about it on its own.
4. More time to get noticed
Obviously, the visibility of an independent artist is much more limited in comparison to signed ones. It is uncertain when an independent artist breaks through and how – most likely, he or she should rely on luck and momentum.
5. Not enough time for creating music
This can be an issue for the artists who don’t have a label, nor a management. Being absolutely independent, means that an artist should learn about business specifics on his/her own or delegate it to a team (if there is one). The problem is, it will take a big amount of time to handle the business side which leaves an artist with much less time for creating music.
Conclusion
Choosing absolute independence might be an option, but it is advised to have enough money and management (that will help to handle everything else) or patience. This road is much harder, longer and requires a lot of luck, but the outcome can be the same as if an artist chose to get signed. Chance The Rapper, an independent artist who refuses to sign to a label, became the first ever artist to win a Grammy for his streaming-only mixtape Coloring Book. In fact, he received 7 nominations and three Grammys for Best New Artist, Best Rap Performance and Best Rap album – all in one night. This instance proves that anything is possible.
Artists should decide for themselves what to choose if they are offered to get signed. There are no right or wrong choices, it all depends on an artist’s personality and preferences. Choose wisely.
