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Jules, some advice on a distribution deal?
Old 13th December 2002
  #1
Gear Nut
 
tee's Avatar
 

Some advice on a distribution deal?

Hey Jules et al,
An artist that I play bass with has been offered a distribution deal for Canada & Europe, with a CD that I recorded and co-produced at my home studio as a spec deal. I have little experience when it comes to the business side of the 'biz and wondering if you could give me a little guidance as to what is a decent distro deal vs. what would be considered getting bent over rollz . The dist. company is offering us a 90/10 split in their favor, and it seems to me like we're getting boned, since it's already recorded and mastered. They are going to repackage it and use their channels to try to move it out of the US. You got any thoughts or experience with this kind of thing?? Much thanks in advance.

Tony
Old 13th December 2002
  #2
Lives for gear
 
e-cue's Avatar
 

Are they just distributing or are they talking a P&D deal? If you have no way to break into the canadian and euro markets and just look at this like an "extra credit" venture, you might wanna consider it, otherwise you are getting the shaft, IMO.
Old 13th December 2002
  #3
Hand on heart? - I have no idea. I have never had anything to do with distrabution deals, although I may in future.

Here are my gut instincts:

----------------------------

Sometimes you have to take it on the chin, just to get into the game.

Are there any other offers?

Or is it the only game in town?

Are future releases covered in this agreement? (be very careful if they are)

You speculated, distribution IS a way to accumulate!

You need more advice (obviously)

--------------------------

I suggest you consult a professional music industry lawyer before making any decision.

Old 13th December 2002
  #4
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5down1up's Avatar
 

90/10 ??? that sounds like a ****ed up deal

60/40 is the ususal thing over here

spend some $$$ on a lawyer before you sign anything .

i am kinda clueless how this stuff works in the states .

take care with those business sharks .

good luck
Old 13th December 2002
  #5
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Ol' Betsey's Avatar
Wait... You mean the distribution company is taking 90% of the Dealer price?

Please tell me I'm wrong. I am wrong, right?

As e-cue has said, unless it's a P&D deal (in which case the percentages vary as does the way the advances/production costs are re-couped) the general percentage a distributor will take is 30% (give or take a few %) of Dealer.

R.
Old 13th December 2002
  #6
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atticus's Avatar
GET A LAWYER.

"If it's a 90/10 split, the label's full of (add your own Cochran-esque rhyming word here)
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Old 16th December 2002
  #7
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tee's Avatar
 

thanks

Thanks for the replies guys, been away for a few days. I'm not involved in the negotiations, although it effects my end.

e-cue, what is a P&D deal, I'm not familar with the term?

We really have no access to these markets without this deal, that's the only thing that's attractive about it. No future releases are at stake.

If anyone knows of any resources that I can use to inform myself about this kind of deal I'd appreciate it and thanks for chipping in.
Peace,
Tony
Old 16th December 2002
  #8
no ssl yet
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Go buy Everything you want to know about the music biz


Another cool book is "The art of mixing"
Old 16th December 2002
  #9
Lives for gear
 
e-cue's Avatar
 

Re: thanks

Quote:
Originally posted by tee
e-cue, what is a P&D deal, I'm not familar with the term?
Peace,
Tony
Depends on who you ask, but "Product and Distribution" is the must commonly understood term. That is, the reproduce the Product, and have Distribution access. These deals have a million bah zillion gray areas you need to cover, so please do yourself a favor, get a lawyer. I know, it sucks. I did handshake deals for years and never got burnt, but I'm at a point where I have to.
Things to consider are promotion, what about electronic distro, cuts, quality of the product realized, international and local issues, etc...
Old 16th December 2002
  #10
Gear Addict
 

This book has the definitive information you are looking for.
'Confessions of a Record Producer'
http://www.mosesavalon.com/index2.htm
Old 16th December 2002
  #11
Gear Nut
 
tee's Avatar
 

Benjy, that's an excellent link, it's just what I was looking for. Thanks Y'all and happy holidays.

Tony
Old 16th December 2002
  #12
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doug_hti's Avatar
 

If this was a near ratio ($1.00 per cd) of recouping for an album you made with a label that had major distribution, then fair enough, as this "label" has made your record, probably hooked you up with producers, gets mixed properly, mastered properly, big photo shoot, maybe a video, maybe advanced you money to live on, has advertisted and marketed, has a team of radio guys that pitch your music to radio while hiring indie's, has put you on a major tour (in which they would be paying tour support to the headliner), would have a team of publicists setting up interviews...get the picture..

This sounds like it is only distribution, besides being put on some shelfs, why would someone risk money to buy a cd that no one has heard of, especially in a time like this. If may be a "lucky find" for some people that take the risk, but...these are not the odds.

A lot of artists don't make money from their record deals AT ALL, BUT BUT BUT...they pay for all of that stuff above, which in turn, gives you sources from

-promoters wanting to book you/or getting on major tour to pay you for live gigs/ticket sales
-merch sales
-ASCAP or BMI royalties (to the song writers) from radio play/soundtracks placing (or whatever companies there are overseas)
-publishing royalities
-endorsements

So even though labels are always ripping artists off (no question), they are setting up other streams of income.


SO....If this is only a "distribution" deal,
no way, unless you have a lot of money and a lot of faith in your current record and a great team of all the types of people mentioned above.

Also, you need to factor in the publishing that is due, which alone is about $1.40 per album for writer/publisher share ($.14/song). So if you have any other writers on this album, they need to be compensated.
I think that typically (in the US) that albums are sold to the distributor (even though they are usually tied in on the same company) for about $3.50 or $4, then the distributor is selling it to the stores at about $9.00. So if you own your publishing (which you need to setup publishing company with a lawyer), they need to be paying you at least $2.50 per album.

Also if you DID agree, and they want it to be multi album, they will try to lock it in at a rate and have album options only for them to choose whether they want to continue. Being that it is already shady enough, you would need to have your lawyer set it up so that you have "options" as well, meaning that in between albums you can say "no, I don't want to renew my option with you for this next album, the deal is terminated".

If you're serious about making this work, hire a great experienced MUSIC ENTERTAINMENT lawyer.

just some thoughts...
Old 16th December 2002
  #13
Gear Addict
 

It's really, really good. I loan it to young clients. They take it home and bring it back the next day, having read the entire book. They can't put it down.
Benjy
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