360 Deals: How Are They Affecting the Music Industry?

360 deals are becoming somewhat of a hot topic these days. The concept of such deals, which allow record labels to become involved in virtually all aspects of an artist’s career, was first incepted in 2002 when Robbie Williams signed his artistic life away to EMI. More recently, the New York Times published a piece on these deals, and now, Warner Music is apparently requiring all of its new signees to take 360 deals.

There’s a lot of controversy attached to all of this: on the one hand, labels exercise even more control over their musicians than they already do, but on the other hand, the labels are forced to pay more attention to their talent, many of whom they neglect and end up dumping even before any records are released.

All of this is a response to the failed and archaic model that the major labels have been stubbornly holding onto even in light of rapidly declining record sales. Really, the majors are taking these measures out of necessity. As the music industry becomes more and more Internet-centric, the majors, at least until now, have become more and more obsolete. They have to offer more than just a record deal to get by.

Don’t get me wrong. The marketing prowess of major labels is formidable, and I’d definitely sign to one of these deals for overnight fame, especially if it didn’t mean I’d have to sell my soul. But these days, the Internet is filled with resources for musicians. You can get your music onto iTunes through TuneCore, you can offer your music to licensees using YouLicense, and of course, you can book your shows online with GigMaven. All of these sites have transformed the music industry into a DIY (“do-it-yourself”) industry, opening doors for musicians of all genres and levels.

With all of these resources out there, the reliance on majors to “hit it big” has diminished. Of course, it’s probably a lot easier if you have a major backing you, but it’s not necessary. As a result, the majors have been in great need of a new business strategy, and it seems like 360 deals are an attempt to get these labels back in the game. So comes the big question: how are these comprehensive deals going to affect the industry?

For one, we’ll probably see a drop in the number of artists signed to majors. There are only 24 hours in a day, and if majors are spending more hours doing other things in addition to promoting records, there’s less of their time to go around.

With mandatory 360 deals, we’ll probably see resourceful and savvy artists shy away (even more) from majors. One of the main things labels look for in signing talent is the artist’s degree of independence. “Will this artist promote himself in addition to our efforts?” Artists who are proactive about their careers have less of an incentive to promote themselves if they know that the label is going to do it for them (and then take a substantial cut).

The types of artists who will be signed to majors will become increasingly cookie-cutter. If you don’t already think mainstream music is all about image and less about the music itself, you’ll definitely think so as 360 deals become the standard. Labels are in essence cultivating a brand when they enter into these deals, and you can bet that they will want to control the brand image, not just from the standpoint of the artist’s sound, but also with respect to the way the artist looks on stage and the kind of merchandise he sells.

That said about the majors, what about the rest of the industry? What about the indie musicians? Internet music resources will likely continue to strive, offering their services to both beginner and professional musicians alike. We’re already seeing a movement of established musicians towards the “indie model,” Radiohead and Nine Inch Nails being popular examples.

As 360 deals push many artists away from the majors, more artists will likely take up the “DIY model,” relying increasingly on the online resources available to them. And it may not necessarily be any less effective than signing with a label. The ability to reach out to a large mass of people used to be exclusive to major labels, but that’s not so true anymore. Online social networks have done wonders in terms of connecting people around the world, from artists to fans to venues, and they’re becoming more powerful by the day.

The resources are there. Artists just have to use them effectively—and many of them certainly are.