An artist development deal-
Is often the first of a recording artist’s contracts with a major record deal. In lieu of high royalties or other desirable rights, the label will promise to develop the skills and public profile of the artist. These types of deals are sometimes most helpful to the artist, but the label often takes control of the artist’s management and publishing rights (dubious practices that have been compared to having a mini-monopoly with respect to the artist).
Historically, such deals have been abused by both record labels and managers. Motown records made extensive use of this type of contract, and many argue that it was the sole reason for the massive success of the label in the 1960s. Berry Gordy, Motown founder, likened his approach to digging for oil and discovering a field full of gushers. Later, Motown was accused by some of its artists of practicing professional extortion .