The term “white labeling” is not exclusive to the entertainment industry. White labeling is a concept that has gained significant traction across various industries, including e-commerce and music distribution. The digitalization of marketplaces on a global scale has provided a thriving ecosystem for white labeling. This article will focus on how record labels, distribution companies, and independent artists utilize white-label solutions in music distribution. For a fraction of the cost of building a custom solution from scratch, they can use white-label distribution software and services, gaining access to a robust distribution platform.

What Is White Label Distribution?

Imagine a company, A, that has developed a music distribution platform. This company can sell or lease its platform to another entity, B, which could be a record label, distribution company, or independent artist. Under their agreement, B can rebrand the platform, put its logo on it, and market its product offerings to third parties without mentioning A’s involvement. To any third party interacting with the distribution platform, it appears as if B is the sole provider of the service.

The same concept applies to distribution software or services. B can present these as custom solutions bearing its brand while utilizing A’s infrastructure to distribute music.

Key Features Of White Label Music Distribution.

• Source from Service Provider

  The distribution platform or service is obtained from a service provider. This could be through a purchase or a lease arrangement.

• Rebranding and Customization

  The platform or service is distributed, managed, and tracked under the name, style, and branding of the paying client (B).

• Fee Structure

  There is typically a fee paid to the original service provider (A) for the services and the continued use of the platform.

• End-User Interaction

  The end users only interact with the name and brand of the paying client (B), never knowing about the original provider (A).

Revenue Generation for White Label Service Providers.

How do white-label service providers make money? Like other Software-as-a-Service (SaaS) providers, white-label service providers generate revenue through subscription fees. These fees are paid to grant access to their services. These subscriptions can be renewed periodically, either monthly or annually.

Also, some service providers boast of additional customized services as add-ons. These are tailored to the needs of the paying clients and can attract extra fees. 

These services may include:

• Royalty tracking and management.

• Brand optimization.

• Strategized marketing campaigns.

• Access to Specific Digital Service Providers (DSPs) through existing partnership contracts.

Revenue sharing is another method for service providers to generate income. This typically depends on the nature of the agreement between the service provider (A) and the paying client (B).

Pros 

It is undeniable that white labeling offers significant convenience to its client base. Other benefits may include:

• Cost-Effectiveness

The access to a customized distribution platform for a fraction of the cost of building such a solution from scratch. This makes what was previously an expensive venture much more accessible.

• Focus on Other Business Activities

Without over-emphasizing the ease and convenience white-label solutions offer, it gives record labels, distribution companies, and independent artists the leverage to focus on other aspects of the music business. 

• Outsourcing

The opportunity to outsource the technical aspect of music distribution to a specialized provider.

• Maintaining a Brand Identity

White labeling offers a customized music distribution experience. The paying client can distribute music under their name, style, and brand. Thereby offering the opportunity to build and maintain a consistent brand identity.

Cons

• Control of the Distribution Process

The paying client must relinquish some control when using a white-label service. Therefore, those who wish to retain a firm grasp on every aspect of the distribution process may need to reconsider using white-label solutions.

• Partnership Management 

The partnership relationship between the paying client and the service provider must be constantly managed. 

• Reliance on Third-Party Service Providers

With white-label solutions, there is a reliance on third-party service providers who maintain the platform.

Does Royalti.io Support White Label Solutions?

Irrespective of how you choose to distribute your music, Royalti.io offers a solution that consolidates all your data into one concise dashboard. With API integration that allows interaction with other software, It provides automated accounting, proving to be the best partner for any music business by helping to make sense of royalty data. Additionally, there is the opportunity to analyze royalty earned against production and distribution costs.

Conclusion

White labeling solutions in music distribution offer convenience to record labels, music distribution companies, and independent artists. Like every other solution, it has its pros and cons, each of which must be weighed on merit. Understanding the advantages and disadvantages, and how white-label providers make money can help you make informed decisions about using these services.