Free goods clauses let labels give away your music for promotion without paying you royalties on those copies. Originally it meant a few promo CDs for radio. Today it can mean thousands of streams, downloads, and promotional uses that generate real value for the label while paying you exactly zero. The definition of promotional has stretched beyond recognition.
The danger is in the percentages. Contracts often allow ten to fifteen percent of units to be distributed as free goods royalty-free. On a million streams, that is up to one hundred fifty thousand plays generating exposure for the label and nothing for you. And labels decide what counts as promotional, which means the category keeps growing.
Digital promotion blurred every line this clause was built on. Free mixtape downloads, promotional streams, bundled giveaways, and platform exclusives can all be classified as free goods depending on your contract language. What started as a handful of radio promos became a gaping hole in digital royalty accounting.
Cap it hard and define it narrowly. Limit free goods to a small fixed percentage, exclude all paid streaming from the definition regardless of promotional intent, and require the label to report every free goods unit separately so you can audit the category. Promotion should build your career, not subsidize the label’s marketing with your unpaid royalties.
Promotion is essential, but your royalties should not be the casualty of the label’s marketing strategy. Define promotional use narrowly, cap the percentages, and audit the category relentlessly. Every free unit should earn its place by building your career measurably. If the promotion is not moving the needle, it is just free music.
About the Author – Ruben Burgos: Ruben Burgos brings over 25 years of music expertise and more than 15 years of model guidance to the table. He is the indie major pinnacle to retaining credits for musicians and helping them navigate this wicked industry without the fuckery.