What Is a Distribution Deal?
A distribution deal allows an artist, label, or rights holder to distribute their music to streaming platforms, physical stores, and other marketplaces without giving up ownership of their masters. While these deals can be a great alternative to traditional record deals, many come with hidden pitfalls that can cost artists in the long run.
As a distribution deal attorney, I’ve seen contracts that look appealing on the surface but contain terms that could cripple an artist’s career. Here are some major red flags to watch for before signing any distribution deal.
Red Flag #1: No Marketing Budget
A common issue in distribution deals is that the distributor provides no marketing support. While they may promise exposure, playlist placements, or general assistance, the reality is that without a marketing budget, your music is unlikely to reach a wider audience.
If the agreement doesn’t specify a minimum amount the distributor will spend on marketing and promotion, you’re essentially signing a deal where you do all the work, and they take a cut of your earnings. Always ask for clear terms on what, if anything, they are investing in your music.
Red Flag #2: No Advance Payment
A proper distribution deal often includes an advance payment based on expected earnings. If a distributor isn’t offering an advance, that suggests they have no financial stake in your success. While advances aren’t always necessary, their absence should raise concerns—especially if the deal includes high distribution fees or long-term commitments.
Red Flag #3: Perpetual Term (Forever Contract)
One of the biggest red flags in distribution deals is a contract that lasts forever. Some deals state that the distributor will have the right to distribute your music “in perpetuity”, meaning they never have to give you back your rights.
A fair deal should allow you to regain control of your masters after a reasonable period—often 3 to 5 years. If a distributor insists on a contract with no end date, walk away immediately.
Red Flag #4: High or Hidden Fees
Distributors often take a percentage of revenue, which is standard, but excessive fees—especially hidden ones—can be a major issue. Look out for:
- High distribution fees (above 20%)
- Additional fees for takedowns or reuploads
- Charges for basic services like playlist pitching
A fair deal should clearly outline what you’re paying for and what’s included.
Red Flag #5: No Transparency in Reporting
Some distributors delay or hide royalty payments through vague reporting methods. If the deal doesn’t guarantee monthly or quarterly royalty reports, you could end up waiting months or years to see your earnings.
Before signing, make sure you’ll get regular, detailed reports showing exactly how much your music is making and from where.
Final Thoughts: Why You Need a Distribution Deal Attorney
A distribution deal can be a great opportunity or a long-term trap—it all depends on the terms. Before signing anything, work with an attorney who understands music distribution contracts to protect your career and ensure you keep control of your music.
If you’re considering a distribution deal or need help negotiating better terms, contact Landry Legal at 888-914-0011 or email us at contact@landrypllc.com to discuss your situation.
