The main point of this podcast was that these days, in a world of the internet, record labels make almost no profit on their big time artists. Katy Perry is a very popular artist who has had five songs off the same album to hit number one on the charts, second only to the great Michael Jackson. If rough calculations where close to the approximate profit Perry’s album has grossed, the label should have made a forty four million dollar profit. But after all the money was properly split up to the singer, songwriters, producers, radio stations and other marketing tactics, the record label makes mere pennies compared to what the artist makes in other revenue, like her sold out tour, apparel, appearance fees, so on and so forth.
In all honestly, I really don’t think this is such a big deal. Katy Perry is the singer/songwriter/performer. Without Katy, there wouldn’t be that eight million dollars in profit the company makes, even though it’s seen as “pennies”. It’s not as if she is taking all the profit to herself, the money that the record label is investing into her is their job, and they are getting paid for it. Yes, without the label she probably would not have the fame she has, it takes a great deal of connections and investment dollars to get to where she is, but nonetheless, she is the talent, and without the talent, all you’ve got is a record label with no records to sell.
Times have changed, and unfortunately, because of the change from actual CD’s being sold at record stores to individual songs being purchased from an online vendor who takes a portion of the profit, the label loses a lot of its revenue. In order to equal out this great loss, record labels are now locking artists into a “360 contract”, where the label is promised a certain percent of all of the artist’s earnings. I feel this is very greedy, but I guess I can’t blame the labels because they are just trying to make as much profit as anyone else would try to make in their situation.
As for Perry, she hasn’t signed a “360 contract”, and to that I say good for her. I'm sure she's very happy with her decision.
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