Manitoba Music
Walmart signs artists to exclusive deal, bypassing labels
Robert Levine has written in the New York Times about mega-retailer Walmart's latest moves in the music distribution and sales business. At Walmart's recent annual sharholders' meeting, there was an abundance of musicians courting deals. The kind of deals recently signed by rock acts Journey and the Eagles.
What's interesting about these deals is that they are directly with the artists, bypassing the labels. In fact, artist managers are largely responsible for negotiating these deals, where record labels would have in the past. In the case of Journey and the Eagles, the artists signed exclusive deals for particular records. Walmart sells the records for around $12 to help draw people into the store - a loss leader - but this means the records are displayed prominently around the store, not just in the music section, and even at the low price, without a label taking a cut, presumably the bands still make a decent percentage.
What's interesting about these deals is that they are directly with the artists, bypassing the labels. In fact, artist managers are largely responsible for negotiating these deals, where record labels would have in the past. In the case of Journey and the Eagles, the artists signed exclusive deals for particular records. Walmart sells the records for around $12 to help draw people into the store - a loss leader - but this means the records are displayed prominently around the store, not just in the music section, and even at the low price, without a label taking a cut, presumably the bands still make a decent percentage.