In a study released last week by major label organization IFPI, breaking an artist in a major market requires at least $500,000, and sometimes as much as $2 million. Of course, there’s no guarantee ‘breaking’ will result in the record label, or the artist making money.
Overall, the IFPI counted $4.3 billion in upfront talent-scouting and marketing costs coming from labels last year alone. “Record companies remain the largest upfront investors in artists’ careers,” the IFPI noted. “Common features of contracts signed with emerging artists include the payment of advances, recording costs, tour support, video production and marketing and promotion costs.”
“The burden of risk lies with the record company.”