And licenses they are, indeed. Just read the TOS of Amazon, for example.

A conversation in the 1980s:

Label Exec: "Chuck, we like your rap music and this new style you have.  Why don't we sign you and make you a household name + millionaire!  Oh and pay for your tours while putting our marketing and distro machine on this"

Chuck D: "Great, where do I sign?"

Label Exec: "Right here."

Chuck D: [willingly signing contract.]

"Softee" indeed.

Chuck signed to Def Jam when it was still an indie, and has seen his contract taken over on at least three different occasions since then.

It's never hard to find someone who doesn't have a fucking clue what they're talking about on threads like this.

Hey, JdJ got news for ya! If the contract changes materially when passed to the major, they have to go through a new round of approvals.  Otherwise it's called a material breach.

And in case you didn't know: indies screw artists bad if not worse than the major!  Especially rap labels.  SO he probably has a better deal now.

I'm aware of all these things, thanks. But it's a nice change to be proved wrong about something else, so I apologise for the dis. Serves me right for jumping to conclusions.

I still think your original remark was dickish, though. If you know anything about the music business (and it seems you do), you'd know it's never as simple as what you sign. The industry will try to move the goalposts every chance it gets. Look at all those acts that had to try and renegotiate their contracts in the 80s when they realised they were only being paid royalties on "gramophone records and cassettes" and not CDs. This is just the modern version of that, and not before time.

To be honest, it's about time this is being addressed. I've worked for a few Digital Music Providers (247 Entertainment and Omnifone) and for me it's clear that it's not the Spotifys and Rhapsodys of this world that are to blame for the artists not getting paid but the labels. 
They ask for huge upfront fees and minimum revenues, which the DMPs all nicely pay up otherwise they don't get the content. 
It's what happens with that cash that's the issue. Nobody has a clear view. I guess it’s just unsuccessfully filling the big gap the labels have created for themselves over the last decade.

I got out of the business not long ago because it's getting untenable for the smaller DMPs to survive, because ultimately, the costs of licensing but also of course of backend, software, employees and admin are not worth the meagre returns. That's why all these companies are firmly in the red. They live on the love of music and tech only, but one needs to be extra motivated to keep it up.
 

Fully supporting Chuck and co. 

There is a bug we're looking at on logins.  Can you give me more details for our QA?  Email at paulr@  thanks 

The labels sign a contract with a third party, that contract is either a license or a distribution agreement. Apple was very smart in NOT creating a licensing scheme for Itunes. Instead, Apple created a Digital Wholesale Distribution Agreement, whereby Apple BOUGHT music wholesale, and SOLD music retail.

Itunes was fundamentally different from every other digital outlet at the time because it was the first TRANSACTIONAL model based on the same mechanics as PHYSICAL RETAIL, which, IS NOT A LICENSE.

Other old school sites such as EMUSIC were in fact license deals, and as such the artists should be paid accordingly.But to assert that all Digital Distribution is a license, when it is not, is just silly.

You are misinformed. It is a license. That's why Apple also pays mechanical royalties. Do some research.

with all do respect, I have a contract with apple directly and it's not a license. do you have a contract with apple?

the mechanicals are only paid in europe as per local law because in europe the mechanicals are paid at the pressing plant. in the USA the labels are responsible for paying the mechanicals from their revenue which is the same on physical CDs as it is on itunes sales...

so I would say to you, please do some research...