Editing Record label (section)

== New label strategies ==

Computers and internet technology led to an increase in file sharing and [[Direct-to-Fan|direct-to-fan]] digital distribution, causing music sales to plummet in recent years.<ref>{{cite web|last=Covert|first=Adrian|date=25 April 2013|title=A decade of iTunes singles killed the music industry|url=https://money.cnn.com/2013/04/25/technology/itunes-music-decline/|access-date=29 April 2016|website=CNN Business}}</ref> Labels and organizations have had to change their strategies and the way they work with artists. New types of deals called "multiple rights" or "360" deals are being made with artists,<ref>{{Cite web|last=Cole|first=Tom|date=24 November 2010|title=You Ask, We Answer: What Exactly Is A 360 Deal?|url=https://www.npr.org/sections/therecord/2010/11/24/131574836/you-ask-we-answer-what-exactly-is-a-360-deal|website=[[NPR]]|language=en}}</ref><ref>{{Cite web|date=15 April 2010|title=Behind the music: When artists are held hostage by labels|url=http://www.theguardian.com/music/musicblog/2010/apr/15/artists-held-hostage-labels|website=[[The Guardian]]|language=en}}</ref> where labels are given rights and percentages to artist's touring, merchandising, and [[Testimonial|endorsement]]s. In exchange for these rights, labels usually give higher advance payments to artists, have more patience with artist development, and pay higher percentages of CD sales. These 360 deals are most effective when the artist is established and has a loyal fan base. For that reason, labels now have to be more relaxed with the development of artists because longevity is the key to these types of pact. Several artists such as [[Paramore]],<ref name=":3">{{Cite news|last=Leeds|first=Jeff|date=11 November 2007|title=The New Deal: Band as Brand|language=en-US|work=[[The New York Times]]|url=https://www.nytimes.com/2007/11/11/arts/music/11leed.html|issn=0362-4331}}</ref> [[Maino (rapper)|Maino]], and even [[Madonna (entertainer)|Madonna]]<ref>{{Cite web|last=Moreau|first=Jordan|date=8 August 2020|title=Madonna Is a Free Agent After Decade-Long Deal With Interscope Records|url=https://variety.com/2020/music/news/madonna-interscope-records-leaves-1234729735/|website=[[Variety (magazine)|Variety]]|language=en-US}}</ref><ref>{{Cite news|last=Adegoke|first=Yinka|date=11 October 2007|title=Madonna move shows music industry's 360-model|language=en|work=[[Reuters]]|url=https://www.reuters.com/article/us-madonna-livenation-idUSN1140445720071011}}</ref> have signed such types of deals.

A look at an actual 360 deal offered by [[Atlantic Records]] to an artist shows a variation of the structure. Atlantic's document offers a conventional cash advance to sign the artist, who would receive a royalty for sales after expenses were recouped. With the release of the artist's first album, however, the label has an option to pay an additional $200,000 in exchange for 30 percent of the net income from all touring, merchandise, endorsements, and fan-club fees. Atlantic would also have the right to approve the act's tour schedule, and the salaries of certain tour and merchandise sales employees hired by the artist. In addition, the label also offers the artist a 30 percent cut of the label's album profits—if any—which represents an improvement from the typical industry royalty of 15 percent.<ref name=":3" />

=== Internet and digital labels ===
{{Main|Netlabel}}

With the Internet now being the dominant source for obtaining music, [[netlabel]]s have emerged. Depending on the ideals of the net label, music files from the artists may be downloaded free of charge or for a fee that is paid via [[PayPal]] or other online payment system. Some of these labels also offer hard copy CDs in addition to direct download. Digital Labels are the latest version of a 'net' label. Whereas 'net' labels were started as a free site, digital labels represent more competition for the major record labels.<ref>{{cite journal|last1=Suhr|first1=Cecilia|title=Understanding the Hegemonic Struggle between Mainstream Vs. Independent Forces: The Music Industry and Musicians in the Age of Social Media|journal=International Journal of Technology, Knowledge & Society|date=November 2011|volume=7|issue=6|pages=123–136|doi=10.18848/1832-3669/CGP/v07i06/56248}}</ref>

=== Open-source labels ===
{{Main|Open-source record label}}

The new century brought the phenomenon of ''open-source'' or ''open-content'' record labels. These are inspired by the [[free software]] and [[Open-source model|open source]] movements and the success of [[Linux]].

=== Publishers as labels ===

In the mid-2000s, some music publishing companies began undertaking the work traditionally done by labels. The publisher Sony/ATV Music, for example, leveraged its connections within the Sony family to produce, record, distribute, and promote [[Elliott Yamin]]'s debut album under [[Hickory Records|a dormant Sony-owned imprint]], rather than waiting for a deal with a proper label.<ref>{{Cite magazine|last=Butler|first=Susan|date=31 March 2007|title=Publisher = Label?|url=https://books.google.com/books?id=eRMEAAAAMBAJ&pg=PA22|magazine=[[Billboard (magazine)|Billboard]]|page=22}}</ref>

=== Crowdfunded labels ===
In 2002, [[ArtistShare]] was founded as the Internet's first record label where the releases were directly funded by the artist's fans.