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How Do Music Distribution Companies Actually Work?


Are you a musician or an aspiring music artist? If you are, you should know how important it is to get your music out there.

After all, what good is your music if no one knows about it? This is where music distribution companies come in.

Music distribution companies help musicians and other music artists get their music into the hands of the public.

They work with digital stores and streaming services like iTunes, Spotify, and Tidal. This way, your music can be heard by millions of people all over the world.

So, how do these companies work? Let’s take a closer look.

What Is Music Distribution?

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Music distribution is the process of getting your music out to the public through digital stores and streaming services, radio stations, TV channels, and more.

Music distribution helps artists reach a wider audience and generate more sales. It is an essential part of the music industry and can be a great way to get your music career off the ground.

There are many ways to distribute music, but digital stores and streaming services are the most common method.

These platforms allow millions of people to listen to your music, making it easy for fans to purchase your songs.

If you’re serious about building a successful music career, you must get your music out there.

Understanding the Inner Workings of Music Distribution Companies

In the early days of the music industry, distribution companies played a vital role in getting music from recording studios to record stores.

This involved manufacturing records and CDs and then physically delivering them to stores.

In the digital era, music distribution companies still play an essential role in getting music to fans, but the process is much different.

Nowadays, most music is distributed digitally, meaning no physical products are involved.

Distribution companies simply provide a platform for artists to sell their music and handle all of the behind-the-scenes work, such as processing payments and delivering the music files to customers.

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They also provide the logistical support that ensures that music is properly delivered to online retailers and streaming services.

In addition, they often provide marketing and promotion services to help artists reach a wider audience, connecting them to their fans.

These companies provide a platform for artists to share their music while also giving listeners a convenient way to discover new music.

Types of Music Distribution Companies

There are five major types of music distribution companies: major label, independent, white-label, open distribution platforms or aggregators, and semi-label distribution companies.

Each type has its own way of working, offering different benefits for artists.

1. Major Label Companies

Major label companies are the largest and most well-known type of music distribution company.

They work with some of the biggest names in the music industry and have the most resources. However, they also have the most competitive and can be more difficult to get signed onto.

Additionally, signing with a major label may mean you don’t get the same level of creative control and hands-on service as you would with an independent label.

2. Independent Labels

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Independent labels are smaller than major label companies, but they can still be very successful. These companies usually specialize in a certain genre or type of music.

They’re also easier to get signed with than a major label; hence, they often work with up-and-coming artists.

While signing with an independent label can be a great way to get your music out there as a new artist, it’s essential to note that they may have fewer resources.

This can mean that it takes longer for your music to get distributed and promoted.

3. Semi-Label Distribution Services

Semi-label distribution companies provide many of the same services as a major label but on a smaller scale. They help with recording and distribution, but they typically don’t have the same budget as a major label.

This means they may not be able to provide the same level of promotion or funding for your project.

However, semi-label distribution companies can still be a great option if you’re looking for more control over your career or if you’re not ready to sign with a major label.

4. White-Label Distribution Companies

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White-label distribution companies provide a technical pipeline for record labels to deliver audio and metadata to DSPs and distribute royalties back to the right holders at scale.

These companies usually don’t position themselves as distributors but as “providers of digital supply chain services.”

Their business model targets top-end independent labels with a sizeable catalog and output or other distributors looking for a tech pipeline.

5. Open Distribution Platforms or Aggregators

Open Distribution Platforms (ODPs) are companies that offer a self-service platform for artists and labels to upload content, manage metadata, and distribute it to DSPs.

ODPs emerged as an alternative for smaller independent labels and artists who were underserved or not served at all by the white-label distributors. The most notable ones are CD Baby, TuneCore, and LANDR.

They all have a freemium business model that charges artists or labels a percentage of royalties earned on the platform.

ODPs are attractive to rights holders because they make it easy to get started, they’re affordable, and they put control in the hands of artists and labels.

The disadvantage of using an ODP is that they’re less efficient than white-label distributors when it comes to getting your music on all the major streaming platforms. They also don’t offer the same level of support and resources.

How Does Online Music Distribution Work?

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Today, sharing a song with people from the other side of the continent is as simple as uploading the file online. In the past, getting music out there was a lot more complicated.

Musicians had to record their songs onto cassette tapes or CDs, then mail them out or play live shows hoping that people in the audience would buy their music.

Unfortunately, digital music distribution is a bit of a misnomer.

While it’s true that you can distribute your music online without all the hassle of physical CDs, there’s still a lot of work that goes into getting your music out there. This involves:

Distributing New Releases to DSPs

Digital Service Providers like Spotify, Apple Music, and Amazon Music are the new wave of how people consume music.

If you want your music to be heard by as many people as possible, you need to get it onto these platforms.

The first step is to create an account with your favorite music distribution company. Once you’ve done that, you can upload your music and artwork to their site.

The distribution company will send your music to the DSPs you’ve selected.

This can take a few days or even weeks, depending on the company. Once your music is live on the DSPs, people can start streaming and downloading it.

Allocating Royalties

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When an artist or producer signs with a distributor, they’ll agree to a royalty rate. This is the percentage of each sale that will go back to the artist or producer.

For example, if an artist has a 60/40 split with their distributor, they’ll earn 60% of each sale while the distributor keeps 40%.

Once the distributor has taken their cut, they’ll pass on the royalties to the artist or producer. This process can vary depending on the type of distribution deal that’s in place.

For instance, some deals may stipulate that royalties are paid out quarterly, while others may opt to be paid every six months.

It’s also worth noting that distributors will typically deduct any fees incurred while promoting and distributing the artist or producer’s music from the total amount of royalties owed.

This includes things like marketing costs, PR expenses, and paid advertising.

What Are Some Tips for Distributing My Music?

There are a few things to keep in mind when you’re distributing your music:

  • Make sure you have all the necessary rights to distribute the song. This includes the copyright to the music, as well as any performance rights.
  • You’ll need high-quality recordings of your songs. The better the quality, the more likely people will listen to them.
  • Choose the right cover art. This is what will show up on peoples’ phones and computers when they’re looking at your album. Make sure it’s something that represents your music well.

Distributing your music online is a great way to get your name out there and reach a larger audience. With a little bit of work, you can make sure that your music is heard by people all over the world.

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