Distribution Companies
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Distributors offer artists and labels a way to bring their music to market without having to give up ownership of their recordings.
Distributors make music available to consumers, both in the form of physical records and through digital streaming platforms such as Spotify, Apple Music, and Amazon Music. They may work directly with artists or through agreements with record labels that use their services. The service is usually provided for a commission, often in the range of 15–20% of revenues.
Distributors vary widely — from automated digital platforms such as DistroKid and CD Baby, to larger companies offering more comprehensive services, often referred to as label service companies.
Label Service Companies
Label service companies combine distribution and professional label services under one roof.
They typically offer, among other things:
They typically offer, among other things:
- Marketing and PR budgets.
- Project Management
- Rights management, including sync services that pitch music for film, television, and advertising.
These companies offer artists flexible services, where the artist usually retains full ownership of their recordings while paying for the specific services they choose to use. Revenue splits are often more favourable to artists than in traditional record deals.
In recent years, the major record companies — such as Universal Music Group, Sony Music Entertainment, and Warner Music Group — have acquired many previously independent distributors and label service companies.
For example:
In recent years, the major record companies — such as Universal Music Group, Sony Music Entertainment, and Warner Music Group — have acquired many previously independent distributors and label service companies.
For example:
- AWAL (acquired by Sony Music),
- The Orchard (acquired by Sony Music),
- PIAS (acquired by Universal Music Group)
- FUGA (a subsidiary of Downtown Music Holdings, which UMG is in talks to acquire)
Put simply
Distributors:“We help you get your record on Spotify and into record stores - - in exchange for a share of the revenue.”
Label service companies:“We distribute your record, help you with promotion, planning, and rights management — and you still keep ownership.”
Label service companies:“We distribute your record, help you with promotion, planning, and rights management — and you still keep ownership.”
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