Perpetuity Record Deals & Their Devastating Effect on Artists

If you are an alternative rock fan and active on Twitter, you might have seen the LOW versus Universal Music Group debacle. Basically, UMG will not give the rights back to LOW to reissue the band’s debut, “I Could Live in Hope.”

According to LOW’s tweet: “@UMG won’t give the rights back. We’ve asked. Original advance was tiny, did 3 1/2 records with them that they won’t give back to us after 25+ years now. They keep licensing to crappy reissue companies and we see nothing. Meanwhile, we can’t tour anymore and tour was all our $.” Undoubtedly, this issue underscores the massive problem with perpetuity record deals and how they impact musicians’ livelihoods.

What are perpetuity record deals?

A perpetuity record deal allows the record label to own the artist’s records and the rights to that artist’s music indefinitely. Each record deal is different, and the “in perpetuity” clause can apply to different parts of the contract. However, a perpetuity record deal literally means the record label owns that artist’s music without an expiry date.

While perpetuity or 360 deals can be beneficial to emerging artists in kick-starting their careers, they do have a lot of downsides. In many cases, artists lose control of their creative work and are unable to buy back the rights, even if decades have passed. In addition, artists may not have a say when it comes to reissues and may not receive as much of the profits as they would under a different type of contract.

Who has been most affected by 360 record deals?

While artists like Taylor Swift and Prince have made headlines because of unfair treatment by their record labels, many less famous artists have been severely affected by 360 record deals. Artists from working-class and minority backgrounds have been disproportionally affected by such deals.

According to the UK’s National Statistics Office, “16.4% of creative workers born between 1953 and 1962 had a working-class background, but that had fallen to just 7.9% for those born four decades later.” [Source: The Guardian]. Artists from disadvantaged backgrounds are less likely to land certain opportunities, making them more susceptible to accepting unfair contracts due to financial and professional needs.

POC artists have also been bearing the brunt of such deals for decades due to structural racism. One of the most famous cases is R&B legend Anita Baker‘s fight to regain ownership of her masters. After more than three decades in the music industry, Baker managed to regain control of her music in September 2021.

Final notes

Given that “master” and “slave” are still terminologies that can be found in record contracts, it is no surprise that many artists feel they are “slaves” to the current status quo of the music industry. Undoubtedly, the time is ripe for the music industry to address the problem of exploitation in such contracts. In addition, these ongoing cases show that it is essential for artists and artist-centric companies to create a new music economy – one that truly recognises that the industry needs artists, not vice versa.