Have you ever thought of how much you could make from streaming alone? For many musicians who desire to know more, this new record label deal simulator is an excellent tool for you to get a better understanding of how things work in all the different types of record deals, how much a musician can make from each instance and the amount of money generated per a certain number of streams.
This record label simulator is called Dealsim, it’s a smart-tool that gives musicians a proper understanding of how things work. You simply input the number of streams and it will quickly tell you how much you can generate and based on various record deals, how much the musician stands to gain.
The simulator focuses mainly on streaming since that is the dominant means of consuming music today.
It has separate components that work individually to influence the total profit, these include the deal type, number of steams, splits, advance payments, recording costs and others.
The simulator is also able to show the gross profit, musician’s profit and the record label’s profit after deducting all incurred costs.
Click here to access the record label deal and stream simulator, Dealsim.
What are the common types of record deals?
The common types of record label deals are; distribution, royalty and net profit deals.
Distribution Deal
A distribution deal is the type of record deal that allows musicians to own masters of their songs and still access funding and label services for the promotion of their music.
Repayment of already incurred costs from recording and marketing are all done plus an additional profit through net profit split or royalty models.
Net Profit Deal
A net profit record deal gives the power to record labels to deduct any cost incurred before sharing the remainder with the musician.
In a scenario where a musician signs a 60 – 40 deal with a label, if they spend GHC25,000 on the musician and they make GHC50,000, they will first deduct their already spent GHC25,000 and then split the remaining GHC25,000 with the musician on the 60 – 40 basis, leaving the musician with GHC15,000 which is 60% of the remaining GHC25,000.
Royalty Deal
A royalty deal usually favours the record labels, musicians will have to recoup all recording costs, advance payments and in some cases a percentage of the music video cost in other to break even. The record label will make further deductions which will end up reducing the real royalty rate further.
Most big labels are quick to invest big sums of money in royalty deals.
Kindly make it a point to leave your thoughts in the comment section, if you have any question, you can also leave in the comment section or email them to diymusic@afrowired.com.
