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4 Things EDM Producers Really Need to Know Before Signing a Record Deal

The EDM blogosphere has been in a frenzy today reporting that Spinnin’ Records and management firm MusicAllStars is being sued by Martin Garrix. The reports stem from an article in Dutch newspaper De Telegraaf. The article says the Garrix is alleging he was given “false and misleading information” about his record contract and was coerced into resigning ownership of his songs.

We won’t speculate on this case. No one should unless they’re holding an intellectual property law degree. One thing we do know about though is record contracts. Specifically how the game is rigged to favor major labels (most of the time), and take artists for a ride. As such, we’re going to take a moment and share some of that hidden information with you, in hopes you can make informed decisions when deciding on a record label.

Aspiring producers, DJs, vocalists, and songwriters—this is for you!

1. Every song has two copyrightable parts

In legal terms, something made of intellectual property (the stuff that comes out of your head) is called a “work.” A musical work is made of two parts: a sound recording, and a composition. Both of these items receive separate protections under the law.

Sound recordings are the big mama, the actual recorded version of the musical work. Record contracts almost universally mandate that any sound recordings made with the label are owned by the label. This means anyone who wants to use that recording, even the person who recorded it, has to get permission directly from the record label. For any purpose. (Fun fact: this is why Ultra Music can pull all of Kaskade’s own music from Soundcloud. Those files of the recordings don’t technically belong to him.)

Compositions are the words, notes, rhythm, and melody of the musical work. Basically the thing the musician created in their head. While equally important for a song as a whole, in the eyes of copyright law nobody gives a crap. If you have permission from the label who owns the attached sound recording, you don’t need the permission of the artist to use the composition. A stipulation in copyright law called a “compulsory license” says that anyone who owns the composition must allow someone to use it provided they pay the royalty rate set by Congress.

In other words…by most contracts, an artist has virtually no right to stop you from using their songs, but no one can use their songs without the label’s permission.

2. Options can be brutal

Remember this phrase: one and six. That little phrase is hidden away in many record contracts, and can be brutal if you don’t know it’s there. When labels are signing new talent, their potential success is pretty unknown. To deal with this, labels often insert “options” into contracts with new artists. These options mean the label only promises to release one album, with the option for up to six more. In practice, one of two things happens:

  1. An artist thinks they’re signing a 7-album deal, only to be dropped after 1 unsuccessful album with an advance they can’t pay back
  2. An artist thinks they’re signing a year-long or 1-album deal, only to find out they’re locked into 6 more releases on that label

An artist needs to be extremely careful when looking at options, because they are often hidden behind arbitrary timelines. A standard record contract has a 12-month length to allow for the first album to be completed. Seems legit, right? If the label decides to exercise its options, you may be there for a long time. (Editor’s Note: This is a major component of the current Kesha vs. Sony Music lawsuit. – 2/23/16)

Hopefully they have a comfy couch.

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