Posted this in the wrong section before (recording techniques) where it was getting zero traffic. Thought it woulda been moved by now but it hasn't been so I'm just gonna remake it here. Really interesting read, might be a little too long for the people here on FP though. Haha joking. Just read it, its interesting--Feel free to delete the other one in the wrong section.
Used this as an answer on another thread regarding money and realized it deserves its own topic since it could really spark a discussion. Got this from a similar discussion I ran into while doing research a little bit back, pretty interesting breakdown of how much money a 'known' (Nick Thayer, I have no idea who he is though) producer made off a 'successful' EP these days.
The following comes from Nick Thayer, a producer signed to Skrillex’s OWSLA label:
Here’s the TOTAL sales breakdown for my Like Boom EP (March 2012). This is sales across all platforms (iTunes / Beatport / etc etc). Bear in mind this EP was the #2 overall release for thirteen weeks on Beatport so you can assume it was a comparative success.
Like Boom 2600 Facepalm 2932 Totalitaria 1125 Haters Gonna Hate 652 Top Of The World 710 What Props Ya Got 614 Rise Up 658 Like Boom Nick Thayer Rmx 1953 Facepalm Rmx 969 What Props Rmx 509
So that’s 12,722 total sales.
For the sake of making this as simple as possible, let’s be generous and call these sales $2 each (most are a bit less). Then let’s split 50% (give or take) for whatever site you sell through, meaning the site takes $1 and there’s $1 left. Most labels these days run on a profit share arrangement which means you split what’s left of that down the middle too. Let’s also allow for any writing splits where other artists have been involved adding vocals etc. So here we have total income that gets to me after the site, the label and the other artists involved have all taken their cut.
Like Boom (50% to sample clearance, 25% share to three vocalists) $162.5 Facepalm $1467 Totalitaria $562.5 Haters Gonna Hate (50% to vocalist) $326 Top Of The World (50% to vocalist) $177.5 What Props Ya Got (30% to vocalist) $158 Rise Up $329 Like Boom Nick Thayer Rmx (see above) $122 Facepalm Rmx (50% to remixer) $242 What Props Rmx (50% to remixer) $127
So that’s a total income from the EP of $3673.50.
(I’m not going to include Spotify or YouTube here as they total less than the price of a beer overall).
At this point you pay your management 15% of what you have. Mastering comes in at approximately $150-$200 per track, so that’s $1500 total. Artwork is $1000 for anything half decent that’s usable across all platforms. A decent publicity campaign is about $300-$500. There’s a myriad of other smaller costs involved too. Some labels will cover these costs up front but it will be a ‘recoupable advance’ meaning you have to pay them back before they give you any money so it’s the same as fronting the money yourself.
So you can see at the end, this EP which probably represented a year of work at actually ended up COSTING me money (though not a lot) to release. If somebody said to you ‘put your heart and soul into this project for a year and at the end give us some money for the privilege of having us listen to it’, what would YOU do?
What about touring?
At this point people usually say ‘well you make a lot of money from gigs right?’. Well not really. Around six months after this EP came out, so in late 2012, enough time to potentially see the benefits, in the US I was earning between $1000 and $1500 for a show. That might sound like a lot of money, but that is TOTAL.
Let’s say I did a run of nine shows across three weeks (Thurs, Fri, Sat night x 3) at $1250. That’s $11,250. That’s A LOT right?? Well. Right off the bat the booking agent will take 15%. As an Australian in the US I pay 30% up front on tax too (this is reclaimable but Australia has a reciprocal tax agreement with US so it comes out of the amount of tax I owe here in Aus). So that’s down to $6200 straight away. Then I have to pay for travel. Let’s say return flights from Aus ($1500 economy fare) plus travel in between shows ($200 per flight if lucky) and we’re down to $2687. You can usually get the club to pay for a hotel on the night of your show, but that’s it. So that leaves maybe ten nights where you are covering it at $100 a night if you can find it. Often they will be much more expensive so you survive by sleeping on couches in friends’ places every second night. That’s $1687 left. Now pay management 15% and we’re at around $1434. Then there is food to pay for cause you can’t live on bar snacks for three weeks. At $30 per day (that’s $10 for b’fast lunch and dinner) for three weeks is around $600 and at that point all you’re left with is around $800 for three weeks’ work, which is not exactly a fortune.
Some points of clarification from my post yesterday.
Seeing as my post has been picked up and has had a much wider reach than I expected I want to clarify some points:
- Artwork costs being $1000 / other EP expenses
It has been commented that this is a lot. What I said is that this is artwork ‘usable across ALL platforms’. That is, usable as a digital album picture, a sticker, an ad mat, tour art (vectorised and layered to make for easy adaptation) and more. I also paid for the original photo. I believe in paying people properly for their work.
- Label deals / splits etc
It has also been commented that labels will split costs on a 50/50 deal. Without going into the specifics of this contract, I paid for the art up front. The mastering expense (I just looked up a statement) was $1700 and was split with the label, so yes, that does alter my maths a little. I only tried to provide a rough guide anyway.
I also mentioned other expenses. These include things such as vocal sessions and lawyers (for sample clearance and for record contracts). These came directly out of my pocket (the track with the sample was completed including clearance before the label was in the picture and a label is not going to pay for your lawyer to sort out a contract with them).
- Travel expenses
It has also been commented that venues should be paying for travel. The deals my US agent (AM Only) works on for me are all-in deals. They do not include flight shares. This is not the case for me worldwide (in Aus and NZ travel is certainly added on top of the fee), but I wanted to use a REAL tour to highlight the situation.
