I was talking to a local politician. Suddenly they started to brag about some local act and told me that this artist will get somewhere because they signed a record deal with a company abroad. Yes, the person was middle-aged; they usually are. The truth is that signing a record deal is not the same as it was in the eighties. Still many people that are not familiar with the music industry or haven’t worked in it for the past five years still see a record deal with glittering eyes. To be honest it’s so far from that.
First, that record deal they were bragging about we don’t know anything about it. A foreign record label can be anyone putting up a homepage and buying some streams. In fact, most of them are that way. There are very few companies that have the power and money to make the global campaigns that are needed.
One of these was another local politician that went around with a band that was really crappy. Of course, they think it’s the best thing since sliced bread. Only local politicians and the artist's mother can’t really see through that the artist is good but far away from unique or good enough to break into the big masses. Anyway, this politician came up to me several years ago saying the same thing, the band is now signed to a German label. The problem here is that this so-called German label is a ‘pay to play’ label. The business model is that the artist pays them for the PR, distribution, and press services. Of course, these labels are more interested in selling than checking quality. Also, the services are usually the same and you might need different teams to make PR depending on what kind of music you are playing. It’s not the same team for a death metal band as it is for the jazz orchestra. Saying that they got a record deal paying for it, sorry that is not a deal. Later, I saw the band “leaving” the label only to be signed by another record label that just signs the band.
These labels sign anything that will agree on splitting the revenue 50/50. The business model is to sing as much as possible and then only spend money if one artist actually starts to promote themselves and get in cash. In many cases not even then.
To be totally honest, the real labels can afford to wait. They have a system that alerts them to when an artist reaches a certain point in streaming. There is no coincidence that artists that reach twenty-five million streams on a song in the first month getting offers from all the labels at the same time. They all know that back in the day you signed a hundred artists to just make money out of five. Now they really don’t have to take the chance on the ninety-five first ones.
Most of the times the record deals are not even worth the paper they are signed on. Still, I see a lot of artists with just ten thousand streams putting up pictures when they sign record deals. You just know that they will be screwed.
Even if you sign with a “real” record label it’s not a guarantee for anything. Another local politician came around bragging about how he got an artist signed to Sony. He proclaimed it was like the biggest thing for his area ever. Then nothing happened. I heard from other people that the team on Sony was a bunch of old guys that they were planning to sack later on. The first decision was to stop the artist from doing live shows. They wanted to come out with an explosion. Of course, already here I understood this was not a good team. The artist then disappeared for a year. No live shows, no releases. All fans just forgot about them. Then suddenly they came back but now they had changed their name. They changed the name to something so generic that it was impossible to search for “it”. Same here I wonder how the Swedish management thought around it, oh yes, they were also old farts that didn’t know anything, more a damager then manager. Then it was silenced another half year. Then they got three shows as opening acts to a big band on Sony. Just to disappear again for six months. I met the politician and asked how the deal went. He said it was a very good plan when the band had been in London and they had written a hundred songs so now it should work out. And they had changed their name again.
This is close to seven years now. The band has still not played live again. A couple of singles was released in the new name, the artist got the usual 100,000 to 300,000 streams that the big labels can offer through their own playlisting. You can see that is fake since these are the Spotify numbers, if you then go into YouTube they only have 120 streams on the same song. In practice, this was a total failure.
This is the reason why I am rolling my eyes when people are bragging that they signed a record deal. Most likely it’s not worth anything. Still, there are deals that are good, where the label put money and knowledge behind it to get real fans, but it's rare, much more rare than people know.
Editor’s Note: Peter Åstedt has been working in the music industry for over 30 years. He has started record labels, distribution systems, and publishing companies. Peter also runs several major showcase festivals and is an advisor for INES and co-founder of MusicHelp/Discover Sensation. He has worked with the Top Ten most streamed songs and had music on both the Olympics and Super Bowl. Peter has currently taken up the seat of Station Manager of Cashbox Radio, working with MD, PD and station owner, Sandy Graham. As well he recently worked as the European Consultant for Heal the Earth – An Earth Day Celebration. His latest venture is a new Showcase Festival in Sweden, Future Echoes https://futureechoes.se/