Let’s say you’re a fantastically successful musician, and who would be more successful than this guy.
Paul McCartney and his well known friends were rather successful musicians in the early 1960s and by “rather successful” I mean they sold more records than few bands before or since. They were finally signed by EMI Parlophone.
Now, back then, they weren’t the most successful rock band of all time, but in order to get a recording contract one of the things they had to do was to agree to let the record company have the copyright for all the songs they actually recorded. That’s pretty much standard even today. The songwriters (Paul, John and a little George) would get a “royalty” for each time the music was used, but the bulk of the money would go back to EMI.
Now, the Beatles are still collecting royalties on those songs, and in 2019 the surviving Beatles and the estates of John Lennon and George Harrison received about $67 million. That means using comparative valuations based on the sale of the catalogues of Bob Dylan, Bruce Springsteen and David Bowie, that the roughly 250 Beatles songs are worth, conservatively, $2.1 billion. Assuming McCartney dies sometime around 2030, those copyrights will be in effect until about 2100. So, although the Beatles get a lot of money from those songs, the rights holders and music companies are making far, far more money than the Fab Four ever did.
And the Beatles are amazingly successful. Even now, bands are signing pretty much the same type of contract when they sign with a label. The vast majority of them will probably be in debt to their record label. Some might break even. A lucky few will make money, but only after their initial contract runs out and they can renegotiate to a slightly less lousy contract that will still make the record company lots of money.
Now, one of the tricks is that when a band is recording, they have to pay for the studio space. There’s no question that studio space is expensive. On top of that, the artist has to pay interest because the studio paying for the space. That interest is pretty large, and the band doesn’t start “paying it back” until the recording is actually released and the record company starts getting paid. The result is that most bands are in debt to their labels, even as the label lavishes money on them for their lifestyle – it just keeps increasing the debt. That’s largely how labels stay in control of their acts.
Prince was constantly at odds with his label, Warner Bros. Prince was a prolific composer – “Kiss”, one of his biggest hits, was written in a five minute span. He was also an incredible producer and was able to turn out several hundred recorded tracks a year. However, Warner pretty much owned everything and refused to release more than a few albums a year, fearing releasing a couple of dozen would eat into their profits. There was nothing Prince could do – Warner Brothers even owned the name “Prince” as a trade mark, that’s how bad the deal was.
Until, of course, he announced that he would now be known as this:
There was nothing in his contract that said he couldn’t release albums under an assumed name, one to which he intelligently trade-marked so Warner’s couldn’t get their hands on it. We all thought he was a bit nuts at the time, but he was just being shrewd. He managed to re-negotiate his contract. A slightly less terrible one.
You’ve probably heard that Taylor Swift lost the rights to all her master recordings, so she just re-recorded them, which means she’s paying royalties to release copies of her old songs. And Taylor Swift is currently the #1 music act on the planet, and she can’t get a good contract.
So, yeah, the music industry is pretty much something that takes advantage of talented young musicians and sucks them dry, making a bucket of money in the process while shortchanging artists.
Oh, and sexual harassment of female musicians by record executives is pretty much par for the course, but that’s another story.