6.7.13 Adam News and Info

Adam's advance for FYE was $300,000. His advance for his second album (Trespassing) was between $225,000 and $450,000 depending on the sales of the first album. (source: California State Filings, Idol Contract 2009) www.tmz.com/2010/05/12/american-ido...s-simon-cowell/

Since FYE was so successful I think Adam's advance for Album #2 would be higher than he got for his debut.

The advance is against future royalties and is NOT related to whether the album makes money or not.

Here is a good report about the music industry: www.ifpi.org/content/section_news/investing_in_music.html
(It is pro label but does a good job of explaining what things cost.)

The cost of trying to create a hit song in the US is about $1,000,000 -- an example: www.npr.org/blogs/money/2011/07/05/137530847/how-much-does-it-cost-to-make-a-hit-song

<< CAUTION: THE REST OF THIS POST IS ALMOST ENTIRE BASED ON INDUSTRY NORMS >>

We do not have any information for how much RCA invested in Trespassing except that it included Adam's advance (probably more than FYE), 19 Recordings advance, production costs and advances/guarantees to producers and song writers, promotional costs, 2 music videos, advertising, support for an extensive radio promo tour, free copies, etc. Plus allocations for administrative costs and overhead.


Trespassing probably looks something like this...

Adam Advance: $350,000 (my guess is it was more than FYE)
19 Recordings Advance: $70,000 (just a guess that they get 20%, this is not a public number)
Recording Costs: $350,000 (I think it was on the high side -- RCA had Adam record NCOE after the album was submitted, and because of the number of recording sessions and locations.)
2 Music Videos: $200,000+
Tour support: $200,000 (radio tour,international)
Marketing and promotion: $500,000-$1,000,000+ (2 songs promoted to US radio)
Cost of album: $1.67 million - $2.17 million

Then add in RCA's expenses for A&R, Accounting, Legal, etc. (+30%)

That puts the project cost at around $2.2 million - $2.8 million.

And they have not made a CD yet.

The primary source of revenue for RCA is recorded music sales, and Trespassing is probably approaching 300K albums* plus the single sales. RCA net revenue is at best $3-4/album (after variable costs and royalties) and $0.40 per digital track sold. For conversation sake, let's say Trespassing tracks sold 2,000,000 units (I just made it up because we have no info.). That is...

[300,000*$4.00]+[2,000,000*$0.35] = $1,270,000 in net revenue.

* 300,000 units based on US sales of 195,000 [173,000 US 2012 sales (known) + 22 weeks at 1,000 units a week] and 65% of sales from the US. I think that is the high side number.

Other revenues are meaningful but will not close the gap.

**

So if Trespassing has not recouped costs, why did RCA go ahead with a third album for Adam. Probably because they believe there is a good chance that A3 will sell a lot. And there are many reasons to believe that Adam has good sales prospects. FYE was very profitable. Adam is very popular in many countries. They believe in his ability to put out popular music -- WWFM.

Pittbull and Farrell were the wishes of that video producers...

IMO the new honcho is in house and EVERYTHING re AI is on the table -  the format, the content, the judges, the songs...for all we know - he can bring his sports experts or football stars and sit them at that judging table... P-) 

Or even Porn Stars ... see guys ?? I told you so !!!!

www.youtube.com/playlist?list=PL8wdt9PU1zxW0Z6fTB1AHa8SV_sszesn2






 1-40  So exciting.. Titanium 701,519.. YAY, onward ,onward..LOL