Music Bussiness Survival Series Pt 4: Entertainment Law

Lisa Lopes

Lisa Lopes (Photo credit: Wikipedia)

By: Julian Harris Gibson

Many artists find out the hard way when it is too late that before they plan a world tour, they need to find a good entertainment lawyer. There have been countless horror stories of artists getting the short end of the stick when the profits came to pass. One of the most recent and famous stories was that of R&B super group TLC which sold a whopping 10 million records for their smash album in the mid nineties only to end up broke due to ignorance and shady business practices. Many people asked how in the world a group could sell that many records and end up broke but as a creative genius and lead singer the late Lisa “Left Eye” Lopez discussed it in a VH1 documentary.

During this film the singer explained how the group only received about one dollar per unit sold, which meant that the original pie for the artist was ten million dollars. This may seem like a boatload of cash, but keep in mind that the original retail price of a CD at that time was about 15.99 which meant at ten million copies sold the record label stood to make well over 150 million dollars. TLC’s share was less than 10 % meaning they only had five million to start out with.  After the label billed the group for the cost to produce, promote distribute and package the album, the group was left with a dismal $15,000 per artist, barely 1 % of total sales.

This case was on the extreme end of the spectrum, but is fairly common in the music business. The practice of billing the artist is known as “recouping” for expenses and is standard in many fields of business. However in the music business, many artists get caught up in the glitz and glamour of the bright lights and get hit by the train of reality –hard.

Music Business Survival Series Pt 3: Publishing

These shady practices are mirror images of some of the sub-prime mortgage schemes that first time buyers fell prey to a few years back. In the same fashion that the mortgage mess almost swallowed the entire economy, these shady practices also have far reaching consequences well after most successful careers are done. Many artists end up as virtual slaves to the label and only get pennies for recordings that make the labels multi- million dollar profit share. For the savvy artist who wants to own his own music, there are two major Publishing firms in America BMI and ASCAP.

These two giants handle the bigger artists as well as the garage bands that may never make it big and may not want to. They monitor media formats for an artist’s music and then pay a royalty on a quarterly basis. Even though most artists get the shaft when it comes to publishing, there are a few hero tales like Percy Miller aka Master P who was the first rapper to demand and receive an 85% share of all profits. This mega deal was unheard of at the time even for white rock acts like the rolling stones and Aerosmith. Master P’s leverage was due to the fact that he had a popular following in his home town of New Orleans and all throughout the south.

 

 

 

Many artists are just now learning of ways to position themselves like Master P nearly 20 years later. Master p has sold over 75 million records has owned clothing lines, movie companies even gas stations and one of the most respected businessman in music history

Notorious B.I.G. (song)