Kanye has been going on another Twitter rampage the past day or two, and among the things he’s posted (besides urinating on a Grammy award) are his contract(s) with his record label.
This summary of the documents Kanye shared was compiled by the user safe over on KTT, and all credit goes to them, I’ve only reformatted it for here.
- first off lemme say that this shit is complicated as fuck and im not a lawyer. however here is some stuff I could glean from the contracts that people might find interesting. feel free to ask me stuff but no guarantees I can help
- From what I can tell the deal was structured to give UMG options to extend the contract multiple times. Of course because of Kanye’s success they picked to exercise these options
- There’s a letter in their from Rock the World and because its only partial I cant read too much into details. But it’s essentially demanding royalty rates of 85%-100% for the different contract periods with the rest of the royalties going to RTW. The issue is I dont know what the contract periods represent. If it is indeed albums Kanye wanted 80% for CD, LR, Grad and 808s, 85% for MBDTF, Yeezus and TLOP and 100% for anything post TLOP. This letter was not signed by Island Def Jam
College Dropout and Onwards
- Its hard to tell what options were exercised but Roc-A-Fella appear to own his masters for whatever number of albums took place on the initial contact - at least two, as many as 7
- He didnt give up any merchandising rights (i.e. not a 360)
- royalty rate of 14% with sales targets pushing it to a possible 19% for late registration and possibly beyond
- Kanye has creative control for all intents and purposes
- Kanye signed the deal in 2011. this was for 3 contract years - however any year that he did not deliver TWO albums from GOOD would be suspended until he delivered 2 albums
- Year 1 got waived for not having two albums
- the contract was extended in 2012 and 2016
- If an artist he brings to Island Def Jam that he wants to sign to GOOD is rejected, he must offer that artist to other Universal labels first
- Kanye has control over contracts subject to a minimum level stipulated by UMG
- GOOD keeps 50% of profits after recoupment of advances
- The Cruel Summer film ended up with a budget of at least $5.7m
- Because of costs associated with the Hawaii recordings and Cruel Summer recordings, Kanye had to pay 100% of Cruel Summer profits to the label until the costs were recouped
- This also may be why Cruel Winter was cancelled. The agreement says if Cruel Winter releases, the label will also take 100% of profits until costs are recouped
- The initial Yeezus budget on the label side was $12m
- Royalty rate was 22% again after recoupment of advances
- was expected by the label by 2015
- royalty rate of 22%
- a later document says the label will also pay 50% of profits for yeezus and tlop. these are technically different things. royalties are based on net revenue whereas profit is revenue minus costs.
- Kanye gets the masters for Yeezus and TLOP 20 years after the release date. if the advancement isn’t recouped he has to pay the difference to get the masters
- the budget was $2.5m of which $1m would be paid after delivery. this was an advance and thus recouped from royalties
- label owns the master
- the royalty return for Kanye was just 15% and that is after recoupment of the advance
Ye and JiK
- Here Kanye owns the master but has licensed it to Island Def Jam for 7 years
- Royalty rate is 25% in the US and 16% elsewhere again subject to advance recoupment
- Kanye potentially wanted to sell ‘super deluxe versions’ of the album exclusively through his online store
What are your thoughts about all of this?