Music Contract – Introduction
The two most common ways we work with musicians are (a) to help them understand and negotiate agreements they’re asked to sign, and (b) to prepare agreements musicians want others to sign.
Here are some general tips that we encourage musicians to keep in mind when negotiating music deals, whether it’s a simple arrangement or a more elaborate agreement, for example with a producer, management company, record label or publisher.
You Don’t Need to Sign. Really.
Just because someone wants to do business with you, and offers you an agreement, doesn’t mean you’re obligated to sign it. It’s nice to be recognized. However, you shouldn’t assume the option of walking away from the offer isn’t on the table. It’s generally on the table.
It’s Not Just about $$$
If you’re getting paid, for example as a percentage of sales, from a music distributor or publisher, money is not the only element of the agreement. Other factors from credit to control are very important. As such, when negotiating dollars and cents, be sure not to forget about everything else that can add or remove a lot of value from the professional relationship.
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The Main Reason for Signing
When I review agreements, I ask the musician why they want to do business with the other person or company. If that reason isn’t reflected by the agreement, it generally should be. If the company, for example, isn’t willing to integrate a certain request into the agreement, it’s likely because they don’t want to give you what you want to receive. For example, if you want a record label to print vinyl, in addition to distributing your music digitally, and vinyl is absent from the agreement, ask them to include a guarantee of a vinyl run into the contract. If they aren’t willing to accept the request, it’s likely because they don’t intend to actually pay for the vinyl.
Music Contract – Know Your Motivation
Know what you want, and what you are willing to give up, in advance of responding to an offer. Think about what’s important to you, without only reading what the other side is offering. What do other musicians generally get from partners like this? One reason to get advice about an agreement, whether from a fellow musician, manager, lawyer, or all three, is that you know what’s being offered, but you may not know what is missing.
Don’t Make The First Offer
A common negotiation technique is to try to get the other side to make the first offer. This isn’t always possible, but it can be helpful. For example, if your new manager asks what commission you want to provide her, ask her what commission and general formula she thinks is reasonable. What she proposes might be more favourable for you than what you were willing to offer if you made the first move.
You Can’t Always Get What You Want
Sometimes it’s helpful to ask for more than what you want. That way you can give the other side a win by not accepting something that isn’t as important to you. If you really want items A, B, and C, you might ask for A, B, C, D and E. If the other side says you’ve asked for too much, you can say you’re willing to remove D and E. The risk is that the other side would rather give you D and E instead of A, B and C.
Create Leverage
If you receive an offer, and you already have an offer from someone else, you can use the two offers to help you get a better deal with whichever of the two potential partners you prefer. For example, an agent wants to seek music placement opportunities for you, and offers to pay you 65% of the fees. Another music placement agent offers to pay you 75%. If you really want to work with the first company, you can say that you got offered a deal for 75%, but want to work with them if they can offer you 70%. It’s not guaranteed to work, but the more offers on the table, generally speaking, the more opportunities you have to get the best deal with your preferred partner. Further to the note above that it’s not just about money, there are other elements of such a deal that should be negotiated, including whether or not you get to approve opportunities to place your music.
Music Contract – You’re Not Tired of Waiting. Repeat.
A very common situation is that a musician receives an agreement from a company, asks some questions or makes some requests, and then waits hours, days, weeks, or longer for a response. You aren’t getting a quick response for many potential reasons. Perhaps the company is no longer interested. Perhaps the person handling your file got terminated. Perhaps the company wants you to wait so long that you’ll accept any offer, including the first one they provided, even though you wanted some changes. Agreements can take moments or months to get finalized, and it can be very frustrating to wait. In the meantime, create some more leverage – more reasons why the company should want to work with you, and compensate you appropriately. The leverage may be getting other offers, or sending new music, a tour schedule, and/or more favourable digital numbers. Don’t overwhelm them, but share good news as your follow-up. While the company interested to work with you is a high priority for you, you are one of some or many priorities for the company. If you’re tired of waiting, don’t show it, because you don’t want that company to use it against you in order that you sign a deal you shouldn’t sign. It’s easier said, or written, than done.
Who Else is Signing This Contract?
The most important way artists can protect themselves from being taken advantage of in a business agreement is to do their due diligence on the other side, to get as much information as possible to decide whether you want to do business with that person or company, regardless of the terms of the agreement. As I’ve noted at my music law presentations, it’s better to sign a decent deal with a great partner as compared to a great deal with a not so decent partner.
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© 2018 Edwards Creative Law, LLP
Updated to October 18, 2022
Edwards Creative Law is Canada’s Entertainment Law Boutique™, providing legal services to Canadians, and international clients who partner with Canadians, in the Film & Television, Music, Video Games and Apps, Publishing and Literary industries.
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* This blog is for general informational purposes only and is not to be construed as legal advice. Please contact Edwards Creative Law or another lawyer, if you wish to apply these concepts to your specific circumstances.
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