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Unless the band either owns the label or has a special distribution deal with them, the label gets the lion's share of the profits, as well as collecting back all the production costs, before they have to pay the band any royalties. (Even after that... a band that collects a third of the proceeds is considered fortunate.) Advances paid to the band are owed back to the label; if the records lose money, the label can in theory demand repayment for the advances and costs. This can tie up a band (or a solo artist) for years financially.

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Q: How are profits split between a label and a band?
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