Producer alleges major label(s) used the term ‘mixtape’ to pay them less

Producer, Music Producer, Mixtapes, Hip-Hop

What is a mixtape? Merriam-Webster will tell you a mixtape is a compilation of songs recorded from various sources, but hip-hop fans know that is only one definition. Mixtapes are also a way for up and coming artists to showcase their developing sound. Before the age of Spotify, and long before the royalty rate associated with sampling rose, many hip-hop artists would sample the hits of other artists and add their own verse (or verses). The reworked track would then be burned to a CD or shared for free online, often both.

Record labels were not always directly involved with mixtapes. In fact, many viewed a rapper’s mixtape as being akin to a band’s 4-song demo. That all began to change after sites like DatPiff and other mixtape hubs began seeing hundreds of thousands, sometimes even millions, of downloads for a single mixtape. Labels then recognized that mixtapes could be a smart marketing tool, and as long as they could keep production costs low they would be able to promote more new talent with less risk.

But there was a problem: Mixtapes still cost money. They may cost less to produce than a traditional album, but there were still numerous people involved in the creation of a mixtape that needed to be paid. Labels, or perhaps their lawyers, realized many of those working on mixtapes would likely love to be associated with a major label and therefore willing to work for less if there was a promise of more opportunities in the future.

The solution was fairly simple. Projects labeled as ‘mixtapes’ or ‘street albums,’ otherwise known as any record released for promotional purposes that are not sold in stores, would pay less than traditional albums. Producers wanting to work with talent on the rise accepted this deal, often signing into longterm deals to work with the label on multiple projects, and for a while, everything seemed to make sense.

Then Spotify happened. Now, for the first time ever, more and more people were streaming music than ever before. They also began buying music less, which in turn lead labels to focus more and more marketing efforts on promoting their presence on streaming platforms. This lead to releasing albums exclusively to streaming platforms – AKA – they released albums they never planned to sell in a traditional sense. These albums were then dubbed ‘mixtapes’ or ‘street albums’ so those working on them would be paid less, but in reality, they’re commercial products being pushed to consumers the same way a label might promote a traditional record.

In short, producers got screwed because outdated language made it possible for the record industry to pay them less for the same amount of work through a very basic act of wordplay. Here’s one producer discussing how it happened to them:

Technology and the way we consume media changes far faster than the institutions that bring us the media we crave. This has been proven time and time again throughout pop culture history. The early stars of television could never have imagined a world with VHS tapes, let alone streaming, so none of them thought to ask for compensation if/when their series made it to those platforms. Likewise, musicians who were successful in a time before the internet have found the battle for royalties to be a constant uphill battle.

It’s not about foresight, however, because nine times out of ten the studios and record labels working with talent are no more aware of what the future will hold than those who produce content for them. Instead, corporations use legal jargon to ensure they always dictate how royalties and sales will be split between them and their talent. For example, since the dawn of the internet many labels have begun adding a clause to their contracts with talent that stipulates they will be allowed to distribute the music on sales and streaming platforms that have yet to be invented. That way, should a new Spotify or YouTube appear, there will be no argument as to whether or not the label gets a piece of whatever money that new channel brings in.

If all this makes it sound like the industry is rigged against the talent you wouldn’t be the only one to feel that way. Throughout time artists of all sizes in every corner of entertainment have had to bargain with those who financed their creative pursuits in order to ensure their livelihood. The chances that this trend changes anytime soon are slim, but thankfully there is more information available than ever that can help artists better navigate this area of the industry. In fact, here are a few books we recommend:

James Shotwell

James Shotwell is the Director of Customer Engagement at Haulix and host of the company's podcast, Inside Music. He is also a public speaker known for promoting careers in the entertainment industry, as well as an entertainment journalist with over a decade of experience. His bylines include Rolling Stone, Alternative Press, Substream Magazine, Nu Sound, and Under The Gun Review, among other popular outlets.