A 360 deal is a recording agreement in which the label takes a percentage of income streams beyond recorded music, such as touring, merchandise, endorsements and publishing.
The mechanism
Traditional recording agreements participate only in recorded-music revenue. A 360 deal extends participation across the artist's other income, on the argument that label investment builds the whole career rather than only the records.
A worked example
An artist whose records under-earn but whose touring is profitable can find the touring income participating in a recording deficit, where the agreement also permits cross-collateralisation.
What it is confused with
- Cross-collateralisation A 360 deal defines which income the label shares in. Cross-collateralisation defines whether a deficit in one area can be recovered from another.
- Recoupment One is scope of participation, the other is the mechanism of repayment.
Why it matters
It changes what the label is entitled to from activity it may not have funded, and combined with cross-collateralisation it widens the pool a recording deficit can consume.
Sources: US Copyright Office
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Related: Recoupment · Black box royalties · Cross-collateralisation