I patiently await the day when artists are able to cut better deals with AAPL, GOOG and AMZN to market and sell their content directly - probably at a 70/30 split like the apps and the books.
* Major label gives artist a loan for $X to cover the costs of
producing the album.
* Artists earn back something like 12% on album sales (though I
believe 12% is on the high end).
* That 12% goes directly towards paying back the loan for the
production of the album.
* Artists don't retain the copyrights to their works (at least the
recordings, they may retain copyright to the lyrics, depending on
the contract/studio).
* Artists don't give a cut of merchandise sales, or ticket sales for
live shows.
* Artists retain the copyrights to recordings of live performances,
which is how bands like Grateful Dead or Dave Matthews can allow
'bootleg' recordings of their live shows.
* The studio retains rights to copyrights of live shows that are
professionally recorded for the purposes of putting out a 'live'
album though.
* Most artists are never able to pay back the initial loan to create
the album.* Major label advances an unknown artist a bunch of money.
* Album sells poorly.
* Artist never pays back advance.
* Major label would have been better not making the deal.
They will syndicate music to amazon and itunes, and they pass through 91% of their net revenue from Apple and Amazon.