Royalty Calculation for Independent vs. Major Record Labels: 5 Quick Contrasts

Curious about the differences in royalty calculation between independent and major record labels? Here’s a quick breakdown to help you understand the distinctions:

Contract flexibility

Independent labels often offer more personalized contracts tailored to individual artists, while major labels typically have standardized agreements.

Scale of operations

Independent labels handle fewer artists and releases, whereas major labels manage a vast array of artists and content.

Technology and resources

Independent labels may use simpler royalty management tools due to budget constraints, while major labels invest in advanced, proprietary software.

Revenue streams

Independent labels have diverse revenue sources, including physical sales and digital downloads, whereas major labels primarily focus on mainstream revenue streams like DSPs.

Transparency and reporting

Independent labels tend to offer more transparent communication with artists about royalty calculations, while major labels may have more sophisticated but less transparent reporting systems.