contrast between major and independent record labels

There are many differences between the major record labels and the independent labels. One major difference between major and independent labels is the financial aspect. A major record label signs who "they" consider to be the most popular, and the major players of today's music. The major record label has the means to obtaining and using hundreds of millions of dollars, which allows them the ability to fund and promote the artists they sign in a variety of different media aspects. Whereas an independent music label does not have the huge funding that a major label does for promotion. An independent artist must contribute to helping promote their music. While this may not be something every artist would want to do, an independent artist that is hands on with their promotion is able to form a personal and unique bond with their fan base.

Most major record labels artists earn a 10-15% royalty on their music. But before an artist can receive their royalty their label must be clear of any debts relating to their music. Such as touring costs, album and video production and any advances the artists received. Money made from the music will first go to the label until all debts are covered, before the artist will ever start to receive any royalty's. Whereas, independent record labels offer a much higher royalty rate, because independent labels production costs are much lower than those of major labels. An independent label is common to offer the artists 40-75% in royalty's