Idolator

One number that's been getting thrown around a lot in the music business is "360"—which refers to a deal where record labels and other entities participate in all aspects of the revenue generated by an artists, from album sales to concert tickets to merchandising. Madonna's big-bucks deal with Live Nation is a 360 deal, as is the contract that Paramore has signed with Atlantic Records. Jeff Leeds in the New York Times got a peek at a 360 deal offered to another artist by Atlantic, and he outlined the specifics in a piece yesterday (where he also referred to them as being "borne by desperation" after the cratering of CD sales).

Particulars of a 360 deal might differ from label to label, but a recent Atlantic offer to another act provides an example of how one might be structured.

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. But 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.

Mr. Kallman said that if Atlantic engages more artists in such agreements, it will have to devote more resources to a smaller roster and raise the stakes for each album. "Your batting average has to go up," he said. If new artists don't become successful, "I've doubled and tripled down on everything and I'm still playing to empty houses and not selling records."

The tour-heavy particulars of these sorts of deals have resulted in some consternation on the parts of observers, with one poster on the music waggery board The Velvet Rope worrying that the increased amount of smaller bands trying to be "broken" by majors will result in "the supply of well-funded, major-backed musicians vying for slots will grow dramatically, and the venues will have to pick and choose, old fashioned payola will grease the wheels and it will be just like radio." With the touring market already seeming like it's reaching a breaking point, the possibility of recouping those advances for touring and merch, which may not go hand in hand but which are related, gets lower and lower; and as a result the patience shown to "baby bands" like Paramore, whose first album under its deal sold a lackluster 140,000 copies, will become a thing of the past. Which is why these deals seem like such a crapshoot for new artists; with music becoming even more crowded out of the attention marketplace, will touring and merch sales really provide that much of a lifeline across the board? Perhaps we need a Steve Albini type to write a sequel to "The Problem With Music" and break down the numbers, once and for all.

The New Deal: Band As Brand [NYT]