How many copies must Chinese Democracy sell so that everyone will profit?

[Mysteron]

We've all heard stories about how much this album has cost everyone from the record company to the promoters, Axl and everyone involved and we know Axl made a new licensing deal for his share of the back catalog to keep the weels turning.

I'm wondering what all this means. Who makes money off this album, how much and when? How much does the record company make off of each copy of CD and how many copies must be sold for everyone to come out on top? Do you think the members have royalty contracts or not?

Can someone please try to break down and explain how all this works?

If one has spent $15 mill, wouldn't you need to sell more than 3 million copies to avoid red numbers?

And last: How many copies do you think CD will sell the first year?

Whatever anyone says or tells you, the record company have reaped good rewards from the recent GH release, and continue to reap income from previous albums.

[D]

Yeah but like any business, they won't count that towards CD because they planned on a GH anyway.

So for labels, they have to still consider CD in the Red and will do everything to make a profit.

[Bucketofguns]

That's very true, AFD and GH continue to be a top seller in the catalog charts.  But that does not answer the question. 

To make a profit, don't just look at CD sales, but also the increase in GNR alumb sales to to the big amount of hype with the release.

[wight gunner]

You'll get new fans buying the back catologue, merchandise and attending shows. There will be a dvd of live stuff, I'd think too, plus that ?15,000,000 will have in part paid for 2 more ablums worth of material, its the long game that will make the money back.

[Allman]

Yeah but like any business, they won't count that towards CD because they planned on a GH anyway.

So for labels, they have to still consider CD in the Red and will do everything to make a profit.

I thought they put out GH after Axl allegedly failed to deliver CD.
Whatever the reason 4 + million sold in the US alone was a nice benefit and with the Best Buy thing in the US they are guaranteed of a X amount of income which I'm sure will cover if not all the cost to make and promote CD and I'm sure in the rest of the world the sales will be quite large.

[IKnowWhereIAM]

You'll get new fans buying the back catologue, merchandise and attending shows. There will be a dvd of live stuff, I'd think too, plus that ?15,000,000 will have in part paid for 2 more ablums worth of material, its the long game that will make the money back.

Merch and Shows are almost never a + for label...label may provide funds to promote a release - through tour/live shows, but live performances are all to the artist in most cases.  The label will get their ADVANCE back, since from what I am told (by a cab driving A&R man!  ) not a dime goes to the artist until the advance is recouped...obviously my 'Taxi Driver' is small time, so GnR may have a different arrangement.

[kunzerd]

We've all heard stories about how much this album has cost everyone from the record company to the promoters, Axl and everyone involved and we know Axl made a new licensing deal for his share of the back catalog to keep the weels turning.

I'm wondering what all this means. Who makes money off this album, how much and when? How much does the record company make off of each copy of CD and how many copies must be sold for everyone to come out on top? Do you think the members have royalty contracts or not?

Can someone please try to break down and explain how all this works?

If one has spent $15 mill, wouldn't you need to sell more than 3 million copies to avoid red numbers?

And last: How many copies do you think CD will sell the first year?

Whatever anyone says or tells you, the record company have reaped good rewards from the recent GH release, and continue to reap income from previous albums.

i agree with mysteron here.

seriously, if the record companies didnt see a financial reward in releasing the album, we probably wouldve seen axl eventually release it on either another large label or a smaller one that would properly push it.

[erose]

We've all heard stories about how much this album has cost everyone from the record company to the promoters, Axl and everyone involved and we know Axl made a new licensing deal for his share of the back catalog to keep the weels turning.

I'm wondering what all this means. Who makes money off this album, how much and when? How much does the record company make off of each copy of CD and how many copies must be sold for everyone to come out on top? Do you think the members have royalty contracts or not?

Can someone please try to break down and explain how all this works?

If one has spent $15 mill, wouldn't you need to sell more than 3 million copies to avoid red numbers?

And last: How many copies do you think CD will sell the first year?

Whatever anyone says or tells you, the record company have reaped good rewards from the recent GH release, and continue to reap income from previous albums.

i agree with mysteron here.

seriously, if the record companies didnt see a financial reward in releasing the album, we probably wouldve seen axl eventually release it on either another large label or a smaller one that would properly push it.

Personally i agree with this. There's no way in hell this thing would happen if there were'nt any profit in sight. For all involved.

I'm still wondering about how this thing can be broken down and explained for the casual music listener who thinks this is just rediculous. I mean no one has ever used 13 15 mill on recording a record so i kind of see why people think this whole thing is crazy.

Another thing is that people don't believe it'll sell many million copies either. Even tho i believe it would, based on past sales and general interest in this monstrosety, i can't really back that up...

How many copies do you think it'll sell the first year?

[Lesty]

I am sick as hell today, but I will try to give my point of view; well, first of all, it was never (and will never be confirmed) how much was spent on recording... there are many numbers floating around and it is no simple maths.

If we take simply and relatively 15m spent and than, I don't know, we also take this rumour that BB has bought 3m (lets say at 5$) it would come even. Everything sold elsewhere worldwide would be a profit, split in some way between band and record company.

There are numerous other things that management and record company might or might not take into the deal. If those 15m where spent to record 3 or 4 albums and record company has a promise that they will have a release material every year or 2 it is another pair of gloves.

I think the biggest profit to the band comes from touring and royalites of music played on different places and occasions. The biggest profit to record company comes out of record sales.

As I see Axl has decided to take more control of everything - producing, deal negotiation etc. and has surrounded himself with some experienced people I am pretty sure they have accomplished a great deal for everyone.

What's most important in my point of view is Axl's stability and will to deal with problems as they come along... there will be problems. There will be issues. I am pretty sure he has strength to fight them all now. As much as I love Robin (and even Brain) most important thing is that once the wheel starts rolling (in a month time) everything just rolls continuously ... with or without Robin or anyone else.

I am sure Axl had a hell of a time, before and after and especially after the 5th of March, but most of the things were beyond his control and there was no fucking way to get them solved... unfortunatley!

You are far oversimplifying things. It's not as simple as Best Buy paying $5 an album, record company breaking even, and then the rest of the money earned being "split up by everyone".
Merchandise contracts, publishing rights and royalities, touring and video costs, etc.... It's not a simple formula, and it gets even more complicated when you consider how many people possibly get credited for writing material on the album. And with Axl owning the Gnr name, the royalties are even more skewed that ever.

My suggestion i,s don't worry about who is breaking even and who is losing money.
Best Buy will win big, beacause this CD is going to create a ton of foot traffic in their stores, and they've received a ton of media impressions already with this news. Gnr will be fine, and universal will be thrilled, as they'll finally be able to recoup some of the losses they've written off the past decade with recording and production costs.

[slashsbaconpit]

Six.


As it turns out, all that bullshit about it costing $3 to $15 million to produce was all a bunch of rumors.

Axl recorded the whole thing in his basement on his eight track mixer for a cost of $15.

[destroier]

Actually, it's already made a profit. Best Buy bought three million copies for a minimum of $9.09 each.
http://moneycentral.msn.com/content/SavingandDebt/P59971.asp

Gross sales already=$27,270,000
Cost estimate= $15,000,000 for production + 5,000,000 for promotion and manufacturing(<$1 each), etc.

Total profit before album is even released=
$7,270,000

[erose]

Actually, it's already made a profit. Best Buy bought three million copies for a minimum of $9.09 each.
http://moneycentral.msn.com/content/SavingandDebt/P59971.asp

Gross sales already=$27,270,000
Cost estimate= $15,000,000 for production + 5,000,000 for promotion and manufacturing(<$1 each), etc.

Total profit before album is even released=
$7,270,000

So Best Buy paid $9,09?

Thats alot!

[D]

Yeah but if they sell all 3 million at 14 bucks a clip

thats 42 million which means they will make 15 million!

Worst case scenario they sell a million and then sell the other 2 million to other retailers for 7 apiece and break even.

[wells]

You are far oversimplifying things. It's not as simple as Best Buy paying $5 an album, record company breaking even, and then the rest of the money earned being "split up by everyone".
Merchandise contracts, publishing rights and royalities, touring and video costs, etc.... It's not a simple formula, and it gets even more complicated when you consider how many people possibly get credited for writing material on the album. And with Axl owning the Gnr name, the royalties are even more skewed that ever.

My suggestion i,s don't worry about who is breaking even and who is losing money.
Best Buy will win big, beacause this CD is going to create a ton of foot traffic in their stores, and they've received a ton of media impressions already with this news. Gnr will be fine, and universal will be thrilled, as they'll finally be able to recoup some of the losses they've written off the past decade with recording and production costs.

If we take simply and relatively ...

well as I said I was just over-simplifying things... it is huge and complex issue...

v. ..