Richard James Burgess’ book The Art Of Record Production is a must-read for anyone aspiring to be a record producer. It is also a must-read for artists, because it provides sound advice and an excellent analysis of the art (and business) of producing a recording. In this excerpt, Richard tells the aspiring producer how he or she should expect to be compensated, and further offers some financial career advice.
How Much Can You Make?
Potential earnings range from the dirt-eating end of the scale to extreme wealth. Initially, the income may not be so great. If you are a complete unknown, you probably won't get a big advance to start with. Until you have a hit or get yourself established in a niche, it may not be enough to live on, unless you live in a mud hut. Prior to producing I was a signed artist who worked as a studio musician on the side. The first project I produced outside my own band was Spandau Ballet's first album. Although the advance was actually quite respectable for an unproven producer, I was still making less than I did working as a studio drummer. However, those albums went gold, launched my producing career, and I still earn royalties from them today.

Ros Earls of 140dB uses as a rule of thumb, £50,000 or $75,000 income per 1% royalty rate per million sales at 1995 prices. Royalties are calculated in one of three ways: as a percentage of the retail price of the album; as a percentage of the wholesale price or published price to dealer which is known as PPD; or as a percentage of the record company's receipts.

One percent of the retail price of an album that retails for $14.99 amounts to 14.99 pence. This, theoretically, translates to $149,900 per million units. Ros's $50,000 per 1% per million units may be closer to the mark by the time you factor in all the packaging deductions, free goods and the other wild and wonderful in which the record company giveth and taketh away.

Producers command anything from no royalty at all uncommon for a very successful producer and above to around 3% of retail. Four percent is not that it's negotiable depending on your leverage.

Using a retail price of $14.99, a 3% producer will make somewhere between $150,000 and $449,700 on a million units. A 4% producer's range will be from $200,000 to $599,600. Whether you are at the top or bottom of the range depends on how well your contract was negotiated and to some extent how good the artist's contract is. When it comes to the way royalties are calculated and the reductions and deductions, the producer rarely gets more favorable terms than the artist.

Do Producers Earn Their Percentage?
Producer royalties are almost invariably taken out of the artist's royalty (as is almost everything else) so if the artist will jump for it, generally speaking, the record company will too.

With a solo artist it's not such a big struggle for them to pay a third or sometimes more of their royalty to the record producer. When there are five members in the band sharing, say, a royalty of 14% (before record company reductions and deductions for anything ranging from packaging to record clubs, videos, tour support, independent promotion and TV advertising) must stretch a lot further. If the producer commands a royalty of, say, 4% that leaves each band-member with 2% each. The drummer will be making less than the producer. True, the songwriters will participate in the performance and mechanical copyright income. Bands can also make a fortune from touring and merchandise sales. Nevertheless, that producer royalty can look like a huge bite out of the future pie to a band member.


How Can You Increase Your Chances Of Success?
Is there a direct relationship between ability and success? Or is success purely a result of good luck? Andy Jackson (The Boomtown Rats, Pink Floyd) thinks there is some connection. "You can be lucky for an album or two, but I don't think you can stay lucky. People that stay doing well do so because they are good. If you aren't any good, then I don't think you will stay there. It doesn't necessarily mean that just because you are good you will get there either. You've got to be lucky to get there in the first place. If you can be successful and stay successful, then you are most likely good. Some people do apparently next to nothing, but their contribution is valuable. Other people do everything. And there's every possibility in-between."

I don't believe for a second that you can say "if you are good, you will make it." Everyone needs a lucky break. Whether you can create your own luck is a deeper issue. (As the saying goes "The harder I work the better my luck gets.") What constitutes 'good' in the context of production – as I have indicated throughout my book The Art Of Record Production – is a complex formula. Whatever your specific ducks are they will need to be in a row:

Having an "ear", a "nose", or a "feel" for music that can ultimately appeal to a wide audience.

An instinct for being in the right place at the right time.

Patience and persistence.

Enthusiasm and energy.

Connections and confidence.

Musical, technical and people skills.

Business abilities.

Common sense.

A knack for being able to make diverse situations 'work.'

An ability to rise above the detail and to keep the ultimate objective in sight at all times.

You can succeed with very few of these qualities. If you happen to be gifted in most or all of these areas, I would think it unlikely that you could fail.

What Is The Secret Of Longevity?
Russ Titleman has probably had one of the most enduring production careers of the past twenty-five years. He started out in a group with Phil Spector while still in high school, wrote songs with Barry Mann and Cynthia Weill, Carol King and Gerry Goffin, played guitar on the internationally successful sixties pop TV show Shindig and worked with Randy Newman, James Taylor, Paul Simon, Chaka Khan, Steve Winwood and Eric Clapton. He also worked in the A&R department at Warner Bros throughout that company's incredibly successful and creative period with Mo Austin and Lenny Waronker. His modest comment on this incredible run of success was that "being in the right place at the right time is part of it."

I would add that you need to be the right person with the right skills in the right place at the right time in order to enjoy that level of success. In Russ Titleman's case he was not only a musician and songwriter who was fortunate enough to go to school with the young Phil Spector but he was able to use his musicianship to unlock the inner doors of the business. On Shindig he says: "We played behind Jerry Lee Lewis, Jackie Wilson, on and on. I got to see everybody and play music behind these great artists. I used to hang out at Metric Music with Lenny Waronker (who went on to become president of Warner Bros), go over to Screen Gems where Brian Wilson would be working. I started taking sitar lessons at the Ravi Shankar institute where I met Lowell George (Little Feat)."

This kind of education is incomparable. To be able to observe and work with the great artists of the time is not only inspiring but challenging. For someone with the talent and determination to rise to that challenge, a stellar career like Russ Titleman's may just become a reality.

Ros Earls thinks the secret of longevity is to restrict your work to projects that you have your heart in. "That's my personal golden rule," she says. "If you look to the money all the time, something's bound to go wrong. It's a negative way to approach any kind of creative project. If you've got your eye on the record you want to make rather than the dollars, the chances are, if you're good enough, you'll make good albums and people will recognize that. Particularly in England. The British attitude is that money is vulgar. If you can be associated with a particular style of music and keep on reinventing yourself that's the most likely way to achieve longevity."

Winning The Lottery
Sometimes, very occasionally, a producer can find himself or herself in a position where shrewd – or perhaps even crafty – business management, the right act and peculiar circumstances can result in a gigantic payout – or a big pension for life.

The term "production company" seems almost too unspecified to convey any real meaning, but in terms of the record industry it generally indicates a company with whom artists may sign an agreement which guarantees them only a chance to record and probably at their own expense. The production company will then endeavor to sign an agreement with a record label to release records by the artists signed to them. Thus the artist is not signed directly to the label. Often the artist has signed with a production company only as a last resort. Often the master recordings remain the property of the production company. The head of the production company often has very good connections with the head of A&R of at least one major label.

Production companies can be headed by managers or record producers, and they are in a unique position to profit from these circumstances, in the first instance by playing both ends against the middle. The scenario goes like this: Wizard Productions signs Band A, guaranteeing them a 7.5% royalty on the records they release; Wizard Productions signs a deal with Major Label, which guarantees them a 15% royalty on the records it produces for them; Wizard Productions therefore splits the difference, giving Band A its allotted 7.5% (probably after recording costs) and keeping the other 7.5% for itself; Wizard Productions consists of one man and his secretary; Band A is a five-piece unit with a manager taking 20% off the top; therefore the individuals in Band A earn a 1.2% (7.5% less 20% divided by five) royalty each, less recording costs, while the producer earns 7.5%, or 6.5 times as much.

This practice is less common today than it once was, and is open to widespread abuse. Artists often realize what is going on and rebel, as was the case of Bruce Springsteen and his first manager/producer Mike Appel. Springsteen had signed to Appel's company Laurel Canyon Ltd., and Appel signed Laurel Canyon to CBS. After two and a half albums Springsteen and Appel fell out over money and production methods. When it came to court Springsteen was eventually free to go with his succeeding manager/producer Jon Landau but not without conceding a substantial payout to Appel, who argued, not without justification, that he had discovered Springsteen, nurtured him and supported him before the megabucks beckoned.

But perhaps the biggest lottery win of all landed in the lap of American producer Shel Talmy who in the early sixties was residing in London and producing many of the bands that followed in the wake of The Beatles. One of them was The Who whom Talmy signed to a six-year production deal in 1965, giving them a 2.5% royalty. He took their records to American Decca which released them in the U.K. on the Brunswick label, and which doubtless gave Talmy a royalty substantially in excess of 2.5%. The Who's management soon realized how little they were earning and persuaded Talmy to increase their royalty to 4%, but this was probably still far less than Talmy was getting. Worse was to come.

After three singles and one album, The Who wanted out – they reckoned they could make better records and still more money without him – but Talmy wouldn't budge. To force Talmy's hand, Who manager Kit Lambert took the group's next single, "Substitute", to Robert Stigwood, who put it out on his Reaction label (through Polydor). Talmy sued, and in an out-of-court settlement was granted a 5% royalty on all The Who's records and singles for the next six years, up to and including Who's Next in 1971, all their best-selling work. He thus earned considerably more in royalties from The Who's record sales than the individual members of the band did... without so much as lifting a finger. Even now, 30 years later, Talmy still collects pro rata royalties on every track The Who recorded up to 1971. He also retains ownership of the master tapes for The Who's first three singles and first album.

This case was exceptional but, there are probably other, similar cases around where record producers, having signed the right act at the right time in circumstances that were less than propitious from the act's point of view, are living on Easy Street. It won't make you popular, of course, and I wouldn't recommend this way of doing business myself, but if you've a thick skin and don't mind what people say about you behind your back, it does have certain compensations...