Are indie or major record labels better for your music career? This guide compares the two record label choices and offers insight from music industry professionals.
Finding the Right Record Label
When it comes to choosing a record label, finding the right fit for your music career is critical. But, are indie or major record labels better for your career? What are the advantages of doing business with small indie companies vs. bigger record labels?
This guide compares the two record label choices and offers insight from music industry professionals.
What are Major Record Labels?
Major record labels or “internationals” are large companies often under the control of a corporate umbrella called a “music group.” They operate their own distribution and publishing companies. Major record labels are also heavily funded. They have big financial budgets for marketing, production, touring, and more. They also have a large network of connections and influence in the music industry.
The big three major record labels are Sony Music Entertainment, Universal Music Group, and Warner Music Group. All other major record labels are “sub-labels” owned by either of the big three.
What are Independent Record Labels?
Independent record labels are small companies called indie or boutique labels. They are generally not affiliated with or funded by the three major records labels. Also, indie labels work with other smaller companies for distribution and publishing.
Many consider boutique and indie labels as artist-friendly. They also offer many other benefits that may be more important to the artist. However, they don’t have the funding for artists that major labels can provide.
Indie vs. Major Record Labels
There are several factors worth considering when weighing the pros and cons of indie and major record labels:
1. Trust and Close Working Relationships
Indie labels and boutiques generally have the advantage here. They have smaller artist rosters, which means you will get more attention. It also makes it easier to develop personal relationships and work closely with the label’s team. It’s always nice to work with someone who has earned your trust outside of business concerns. In contrast, most major labels have large artist rosters and so many moving parts that it can be hard to know who’s working on your release.
Working in the music industry is all about vibes. When looking for a manager/agent/label, try to find someone whom you can truly be friends with. If you share the same interests and trust each other, that person will have the best intentions for you whether they operate in a big or small company. Besides, life is too short to work with assholes anyway. Francis Di Stasio – Label Management Consultant, Turbo Recordings and !k7 Records, Berlin, Germany
2. Record Deal Terms
Across the board, boutique deals will tend to be more favorable to artists. Indie label contracts are known to be artist-friendly. They tend to give artists a larger royalty percentage than major labels. For example, deals with indie record labels have trended towards simple contracts that offer 50/50 splits. This agreement gives the idea that it’s a partnership of equals. Major label deals, on the other hand, rarely offer a percentage higher than 18%. There are also plenty of deductions and a level of complexity that requires the help of a lawyer to understand.
Furthermore, indie label contracts often give the artist most of the creative control over their music. The agreement terms also give the artist back the “ownership rights” to their music after a short period.
Also worth considering is a key person clause. A key person clause (or key man clause) in your contract gives you the option of ending your deal if a given person – typically the one championing you – leaves that company. In general, this clause lets you follow them to their new agency. At a big company, you could get passed off to people with whom you have no relationship. This leaves you stuck in a contract without any benefit. With a small company or sole proprietorship, the chance of you getting passed off to someone else is less.
3. Artistic Priorities
Do you want to work with a team that believes in your music? Indie record labels don’t have a board of directors who are more interested in a profit than your music. Small companies tend to sign artists because they love their music and believe in their brand.
Same goes for other music career opportunities. Do you want to play in the biggest venues and make the most money OR do you want to make the most interesting art? Big companies can have objectives and expectations regarding revenue. These ambitions may or may not align with yours in the short or long term.
As an emerging artist, I think the most important thing is surrounding yourself with people that believe in you and your music, whether that’s a small label/partner or a major. That will mean people will work hard for you, and you will have the support to make the most of yourself and shape your career. Some of the best people work at small companies and can move mountains through sheer determination and hard work. The resources of bigger companies don’t always make the difference. That being said, always be open to new opportunities, small or big, and know your worth. Great opportunities are rare, and when they come by, you need to work your hardest to seize them. Make sure they don’t pass you by. Eva Tidlund Dirkse – Listen (wearelisten.com), NYC, ex-Sony Music
On the other hand, a big company has experience developing artists and music careers. They will have a better sense of what’s ahead than someone from an indie record label who may have less experience developing careers or are learning as they go. Dealing with people you trust is important here. It’s something that may not seem intuitive but necessary to take your music career to the next level.
4. Other Artists/Clients
Are you comfortable being one of 23 artists, of which you might not be the #1 priority at a given time? This is often the case at a big management company. Or do you want to be one of 3, 2, or the only one on their roster, like with some single-proprietorship managers?
The flipside of this is that a big label, agency, etc. use the hottest, “tentpole” artists to leverage bigger/better opportunities for the agency’s smaller ones. An excellent example of this is live booking. Many newer acts get on festival lineups that have booked bigger acts from the same management/booking company. A small company won’t have that option. Which brings us to….
5. Music Industry Influence and Connections
The big names almost always have an advantage here – that’s the #1 reason people go with major record labels. The majors are still the most reliable option if you want to become internationally famous. For example, on an Ariana Grande level. They typically have greater access to traditional distribution. They also have relationships with terrestrial radio, which is still a big money-generator. In general, major record labels have well-established influence and connections across all aspects of the music industry. In contrast, smaller companies probably know the same people you do. They will help you more from sheer hustle than pre-existing relationships.
I chose [to work at] a major label because I came to the business from a finance and business angle. Opportunities to negotiate large licensing deals are more frequent at a big corporation than at an indie. But indies are actually pooling up resources (e.g., Merlin) to better represent their interests. So, the kind of role I was after does also exist in the indie world. Olivier Parfait – Sony Music, London, UK
On the other hand, a local indie company is going to have better relationships with the grassroots music scene, underground promoters, etc. Those connections will be the most useful for the start of your music career. Plus, they can work with a much shorter lead time. Good luck getting something released by a major less than three months after you hand it over!
In the end neither big nor small are inherently better. It’s all about your musical career and personal priorities. If you want fame and the most revenue, major record labels are the way to go. Bear in mind the drawbacks of working with these huge corporations. And there’s no reason not to mix and match. For example, a “friendager” (manager friend) with a big label and midsize booking agent. Whatever works, do it!
About Matthew Justin
Matthew Justin teaches Music Industry, Studio Techniques, and Synthesis. He has previously worked at WMG, Turbo Recordings, and many other music-related companies in Canada, the UK, and the US.