BET’s New Edition Story was an excellent small screen portrayal of the larger than life group. One of the things about the movie I really enjoyed is it’s reflection on the importance of knowing the Music Business, especially how artists get paid. In the clip below, the mothers of New Edition are angry and very upset that after all the touring and record sales the group’s check was only $1.87. New Edition’s manager, Brooke Payne, came to understand that everything the record company paid for was recoupable, meaning all the expenses paid for on the group’s behalf must be paid back first. The studio time, cost of producing the music and videos, costs of touring, and anything else paid for was not free, but a loan.
Did New Edition Get Ripped Off? Who Stole The Money?
The mothers of New Edition were in such shock about the group’s check being a dollar and 87 cents, some of them begin to claim that the money must have been stolen. What most people, including too many artist managers, don’t know is that unless an artist comes to the table with a lot of clout, significant independent record sales, and a large fanbase, the record company will only offer a standard recording contract. In this situation, artists end up breaking even (getting little to no money) or they may even owe the record company money which the company can recoup from the next album and tour (if there is a next time).
Did Streetwise Records, the label that produced and released the Candy Girl album, inflate the expenses with shady bookkeeping? That’s possible. Because the group only received less than $2 from their first world tour, their record deal seems similar to today’s 360 deal, where the label gets a piece of everything (record sales, touring, merchandise, etc.). Yet, even if Streetwise Records didn’t cook the books, as Left Eye from TLC explained, a deal that’s written overwhelmingly in favor of the record company still leaves the artist with a very small piece of the pie.
New artists don’t get rich from standard recording contracts, and as you can see in the New Edition Story, after their successful tour, the group and their families were still living in the projects. Not knowing exactly how and when an artist gets paid can cause a lot of heartache, mistrust, and empty pockets.
Learn the business, so that you know what to expect, then you will be in a position to make better decisions when considering record deals.