Industry Models: The Digital Store
How it works
iTunes is a digital store. Artists usually upload their music through an aggregating distribution service like TuneCore or CD Baby, or they can work directly with iTunes. Most songs on iTunes sell for about $1.29. Apple takes roughly 30% of sales and the rest goes to the rights owner of the music.
Who gets paid?
The big question here is if the artist is signed or not. Signed artists often get somewhere between 10-25% of the retail price from music sales depending on the deal they have with their label. Let's use a signed artist selling a single song on iTunes as an example, and let's use 16% as a middle ground for the cut they get.
1 song sells for $1.29
iTunes take 30%, or $0.39.
There is often a mechanical royalty to the publisher of about $0.09.
The rights owner, in this instance the record label, gets paid the remaining $0.81.
16% goes to the recording artist, or $0.21.
46.5% goes to the label, or $0.60.
Making $0.21 cents/sale, a signed artist would have to sell 7,000 songs/month to make the federal minimum wage of $1,260/month.
All the more reason to stay independent.
All the more reason to try something else.