360 Deals: What They Are and Why to Avoid Them

The full breakdown of 360 deals — what labels take, why they're predatory, and what alternatives exist.

The Deal That Takes Everything

A 360 deal — officially called an "all-rights deal" — is the most common contract structure offered by major labels today, and it is also the most dangerous for artists who don't fully understand what they're agreeing to. The name comes from the idea that the label gets a piece of 360 degrees of your career. Not just your music. Not just your streaming royalties. Everything.

What Labels Actually Take in a 360 Deal

In a standard 360 deal, the label receives a percentage cut of:

Recorded music royalties (the traditional label cut, usually 80–86% of revenue)
Live performance income — ticket sales, festival fees, touring income
Merchandise revenue — every hoodie, t-shirt, and hat sold at shows or online
Endorsement deals — brands paying you to appear in ads or post on social
Acting and film income — if you appear in movies or TV shows
Book deals and other media
Sync fees on both the master and composition side

Typical 360 percentages: 15–25% of touring income, 10–25% of merchandise, 5–15% of endorsements. These are on top of the label's existing cut of recorded music revenue.

Why Labels Started Doing This

360 deals emerged in the mid-2000s as CD sales collapsed. Labels argued that if they were going to invest in breaking an artist — paying for recording, marketing, tour support, radio promotion — they needed to participate in all the income streams their investment created. The logic isn't entirely wrong. But the execution is almost always one-sided.

The problem: labels are often not actually contributing meaningfully to your touring success or merchandise operation. You're building those revenue streams. They're just contractually entitled to a slice because of language you signed at the beginning of your career.

Why 360 Deals Are Particularly Predatory for Emerging Artists

The power imbalance is greatest when you're unknown. A label offers a 360 deal to a new artist who is desperate to be signed, has no leverage, and is advised by inexperienced management. By the time you're successful enough to renegotiate, you're locked into options that extend the deal for multiple album cycles.

Consider this math: You headline a festival for $500,000. The label takes 20% — $100,000 — off the top. They didn't book the show. They didn't manage your touring operation. They just cashed a check because of a contract you signed six years earlier when you were 22 years old.

Alternatives to 360 Deals

Licensing deals: You retain master ownership and license the label the right to distribute and market your recordings for a limited period (typically 5–7 years). No touring or merch participation. This is what artists with leverage can negotiate.

Distribution deals: A label or distributor simply delivers your music to platforms and takes a smaller cut (15–30%) with no rights in live performance, merchandise, or other income streams.

Joint venture deals: You and the label form a partnership, typically splitting profits 50/50 after costs are recouped, and both retain some ownership in the masters. More equitable than a standard deal, harder to get.

Staying independent: With services like DistroKid, TuneCore, and EMPIRE, you can distribute music globally without any label participation in your career. You keep 100% of all income streams.

If You're Being Offered a 360 Deal

Negotiate out the 360 elements if you can. Here is what to push for:

Remove live performance participation entirely. This is your income from your own labor.
Cap merchandise participation at 10% max, only on label-sponsored tours.
Limit the definition of "recordings" so demos and freestyles aren't included.
Add a sunset clause so the 360 provisions expire after the initial deal period.
Get a reversion clause on the masters.

Any label that refuses all negotiation on these points is a label you should walk away from. Your career will outlast any deal if you build it right.

Key Takeaways

360 deals give labels a cut of ALL income: touring, merch, endorsements, film, and more — not just music
Labels typically take 15–25% of touring income and 10–25% of merchandise under 360 structures
These deals emerged as CD sales collapsed — labels needed new income streams
Alternatives include licensing deals, distribution deals, and staying fully independent
Always negotiate to remove live performance and merchandise participation before signing

Glossary

360 Deal: A record contract where the label receives a percentage of all the artist's income streams — touring, merch, endorsements, and more — not just recorded music.
Tour Support: Money a label advances to an artist to subsidize touring costs, typically recoupable from the artist's future royalties.
Endorsement Deal: A contract where a brand pays an artist to use, appear with, or promote their product — often a significant income stream for successful artists.
Sunset Clause: A contract provision that automatically terminates certain obligations or rights after a specified period of time.
Joint Venture: A business arrangement where two parties (typically an artist and a label) share ownership, costs, and profits on a project.