The latest episode of BillboardExplains delves into the role of record labels, how they make profit and how they’re evolving in the age of social media.
“When you think about a record label now, it’s really important to focus on the fact that they have massive marketing and publicity muscle,” says Dan Rys,‘s senior writer. “They are the ones who are able to put a billboard up in Los Angeles. They’re the ones who can get you placement on streaming services.”
Labels typically make money on songs’ master recordings one of three ways: through music sales, downloads and streaming of an artist; brand partnerships where an artist endorses a product; and master licensing, using the exact recording of a song for a commercial, movie or TV show. Labels can also make money on touring, merch and other opportunities based on deals signed with artists.
Thanks to social media, the way labels recruit artists has changed drastically. “There was a time when record labels were the only way that anyone could actually get their music out to the public,” says Keith Caulfield,‘s managing director of charts and data operations. “They controlled all the marketing and distribution of getting your music into stores. Today, that’s greatly different because you have the Internet.
Watch the latest Billboard Explains above. After the video, catch up on more Billboard Explains videos and learn about the
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