Good Deal Or Bad Deal? This Record Deal Simulator Can Tell You

Although a record deal is often perceived as something of an industry Holy Grail for up and coming young artists, the music business is also full of artists getting ripped off or otherwise thrown under their bus by their label (looking at you, Taylor). Thanks to this new interactive website, artists can more easily determine whether a record deal is actually any good.

Guest post by Bobby Owsinski of Music 3.0

Many young artists believe that the end-all-be-all of their career is getting a record deal. If you’ve been in the music industry for a bit you know that’s far from the truth. The problem is, how to really evaluate a deal if and when it’s offered to you. Yes, you should have a music attorney representing you, but the fact of the matter is that if you’re offered a small deal, you might not get the advice you really need. That’s where the Record Deal Simulator comes in.

The Record Deal Simulator is an interactive website that allows you to evaluate not so much whether a deal is good or bad, but what it takes to make money from it. It takes a lot of factors into account , as well as multiple types of deals to give you a rough idea as to how many streams you’ll need to break into the black and actually see some money in your pocket.

The artist or band plugs in the type of deal (Royalty, Net Profit, or Distribution), the advance, recording costs and marketing costs. Then you’ll can vary the number of streams it takes to break even, as well as the average royalty per stream. You’ll then see how much profit you’ll make and how much the record label will make in turn.

The hard dose of reality is that the number of streams starts at 20 million, which is difficult for many artists to get their arms around. Unlike the physical product days where you could make money at even 50,000 units sold, it takes a lot more streams to get in that ballpark. The fact is that you really don’t have a hit until you hit the 100s of millions of streams, and a huge hit is at least a billion. 

You might think those numbers are out of reach, but it’s surprising the number of artists that are doing it – even ones you’ve never heard of.

Check it out, have a play, then look at the reality of your deal.