What is a Production Deal?

What is a production deal?

In music, the term ‘producer’ is very different in meaning than what you may think. Unlike T.V. and movies, where producers and production houses manage or arrange for funds – in music the producer fills up the shoes of a director.  

A production deal or agreement is signed between a producer and an artist (two parties). The producer is NOT a major or independent record label. In fact, the producer is just a music publisher or in the business of recording music which he can later license or sell to a record company while keeping a percentage of the profit earned from the different revenues that it generates. 

The whole point of signing a production deal is to involve a ‘middle man’ who is promising you a record label in the future for a slice of the money pie. New technology had lead to hundreds and thousands of small and medium sized studios that have mushroomed all over the world. At the same time the big labels are low on funds and some of them are suffering loses. It had become hard for them to keep up with all the demands and the production deal is, in some ways, a way to outsource certain redundant headaches.

The only aspect is that there are so many great producers out there that have become a symbol or a short-cut to success. These ‘kingmakers’ like Quincy Jones or Dr. Dre can take an unknown artist, produce their album and turn them into an overnight celebrity. How? Since they are so well-established, a lot of record labels are interested in signing up artists whose album has been produced by an established producer. However, this whole ordeal empowers producers and labels, but seldom adds to the already difficult life of an artist.

Production deals have often been called anti-artist deals by critics. This type of a deal has various pitfalls. It goes without saying that the more people you involve in the chain that links you to a record label, the more you will have to part with the money you earn.

The production deal means you will be shelling out anything from 3 to 10 percent when you get a record label. Some producers will also recoup the money they spend the album from your royalties after you get signed. Ideally, they should be recouping this 50% from your royalties and 50% from the record label. For this and so many other reasons, it is indispensable to have an attorney who can help you with such a contract before you sign it.

A lot of production agreements contain clauses that can lead to

  1. Giving away administrative control. This means the production guys can do what they want with all of your creative material
  2. Not only can they do a) but they can also charge for it without having to pay you anything at all
  3. They collect the money from other income sources and pay your after their accounting (which can be inaccurate to deprive you of the correct amount that you deserve)

Don’t forget that a production deal is not the same as having a recording contract, it is just (an optional) step towards getting one.

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