Henry Stone on Record Royalties: “Art Rupe From Specialty Was Tough”
Most music listeners don’t know how the music business actually works. It’s not complicated, but it’s a little bit tricky to understand the concepts of masters, writers, and publishing. Essentially, artists are usually advanced a sum of money by their label to pay for their own recording sessions. The record label is ostensibly paid back through the sale of the product they manufacture. If the artist writes the song, they are entitled to credit and royalties for doing so through a performing arts organization such as BMI. Obviously, many times in the history of the music business, unscrupulous parties have used artist’s lack of knowledge on the subject to give themselves a business advantage. On the other hand, people ought to pay close attention to documents before they sign them.
Henry Stone was always known to drive a hard bargain, but when it came time to pay his artists, he always had cold cash, cars, and checks when it came time to pay the piper. Here are some of his memories about how the record business works:
“I wasnt basically that heavy in the manufacturing business until the 1970s.
I was a distributor and also making records because I dug em’, because that was my passion. I always loved to make records, yknow. Some people play golf, I made records.
But I wasn’t like Art Rupe from Specialty who that’s all he did. Lew Chudd from Imperial, that’s all he did. All they did was make records all day, and they paid the artists very little. Even Motown paid their artists not too much, whatever the deal was at the time. Half a cent on a million sold is $5,000, and then the artists wouldn’t get the money cause it took that money to record. Every artist until this day has gotta pay for their own recording. You advance them the money. And if you spend $10,000 on the recording, that was charged to the artist.
Otis Williams and The Charms, I think I had them on a 3 cent royalty or somethin like that. They worked too and did a lot of gigs. They had their gigs. If a group had a couple hit records, they went out and did gigs and had a lot of shows and thats how they really made their money. Cause most of the money that hit records would generate, the record companies recouped yaknow…
Art Rupe from Specialty had a whole guide that he gave his people on how to find an artist in the street, sign em’ to a deal, and cut a record. In those papers, he’s offering a half cent royalty contract. For every record sold, he’s offering the artist half a cent royalty.
So if a guy had a million selling record and had could have $5,000 or $10,000 comin to him, whatever the deal was, a half a cent was very unusual, that was unusuallly low, it was usually 2 or 3 cents a record for an artist if I rememeber correctly. But half a cent? Art Rupe from Specialy was a real tough tough wheeler and dealer so he coulda had it, if he said so thats what he did.
But that’s not what I did. Ask any of my artists to this day. If anybody lost money, it was me, cause I was always putting it back into the company to make more records.”
- From a 2013 interview where Jake Katel asks Henry Stone about Art Rupe’s Specialty Records contracts and field guide for producers on his label
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