What Really Happens to American Idols

Cafe Society
1

In the last American Idol thread, the comment was made again that it might be better to finish second or third on American Idol than to win. I wondered if this was true, so I went digging for the Straight Dope on how American Idol contestants are paid, what contracts they have to sign, etc.

I figured some of you would be interested, so I started this thread to capture this information. Here are some answers:
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Contracts**
All American Idol Contestants that reach the top 12 have to sign a contract that gives 19 Entertainment the right to sign them to an album contract if they choose. It doesn’t matter if you finish first or 12th, if the AI people want you on their label, that’s where you’re going. So there’s no truth to the notion that if you finish lower you have more artistic freedom - unless 19 Entertainment decides to cut you loose.

They can also assert the right to be your manager. From the NY Times:

Note that’s not even a record contract. Even if 19 Entertainment chooses not to give you a record contract, if you go off and sign with someone else they can exercise their option to be your ‘manager’, and any non-recording income you make they get a piece of.

As for the record contracts themselves, I believe it works this way: The winner of the show is guaranteed a contract with an advance of $500,000. They’re also going to get more money spent on promoting and producing their album, giving it a better chance of being a big seller. The second-place finisher also gets a contract, with a $300,000 advance. After that, the studio can choose to sign any of the other top 12, and if they do, they give them a $200,000 advance.

As for being paid for being on the show itself: Before they reach the top 12, the contestants are paid as game show contestants, although the actual size of the payments have never been disclosed that I could find. All contestants who reach the top 12 are required to join the AFTRA union, and from that point on they are paid actor’s wages which last year were a minimum of $1,011 for an appearance on a one-hour show, or $1540 for a two hour show.

Sources of Income
The higher you finish, the more money you’ll make. The winners make a LOT more money than the also-rans, because aside from the music royalties and contracts, they also get paid licensing and merchandising fees. The winner’s faces wind up on billboards, on TV and print ads for the next season, on banners in the studio, etc. Every single one of those is worth money. Then there’s the “American Idol Experience” from Disney, which pays the winners big appearance fees and fees to use their likenesses in the show.

From the NY Times article cited below:

Then the top three also make a ton of appearances on TV shows, radio programs, etc. As members of AFTRA, they would have to be paid at least scale for those appearances, I believe. So that’s $1000 a pop or more.

Kris Allen made ‘at least’ $650,000 in income in his first year as an American Idol winner, and he’s one of the least successful winners the show has had in terms of record sales. And that doesn’t even include song royalties or concert fees - that’s just merchandising, advances, and appearance fees.

Someone like David Cook, who had 11 singles in the Top 100 at the same time, probably made millions. The NY Times reports sources close to the show that say no winner has ever failed to make at least $1 million total in the first year or so after the show. So even if their careers slide after that, you can guess that $2 million or more is a reasonable estimate for the total earnings from winning the show, and likely much more.
Here’s the difference between first and second place:

And between the top two and the rest of the top 12:

The AI Summer Tour
Idols that reach the top 10 get to go on the American Idol summer tour, for which they are reportedly paid about $10,000 per month over the three month tour. So finishing in that 11th spot really sucks.

ITunes Show Recordings
Once you’re in the top 12, your songs get recorded and put on iTunes. The artists earn royalties on those, plus they are paid a flat fee as performers. For each song, they get paid a $1000 fee for services, plus a $1000 advance against royalties. They then get a cut of the royalties that exceed the $1000…

So even assuming the songs don’t sell enough to more than the royalty advance, that’s $2000 per song. The top two finishers by the show’s end record something like 15 or 16 songs, so there’s another $30,000 at least.

They also get a cut of the revenue from re-sale and re-broadcast of the show itself. Previous seasons of American Idol are run late night on Fox, and compilation shows can be purchased on DVD. All the performers on the shows that air or are sold get a cut of the proceeds.

Other Income
Like any celebrity, there are big bucks to be made in merchandising. Posters, T-Shirts, you name it. Even the lower-tier contestants can make money in their hometowns where they often become minor celebrities. “I’m Phil Stacy, and I just love going to the Eastern Steak House off of Exit 5 on the Yazoo City turnpike!”

They also make extra money for the group sings, the Ford Commercials, the appearances they make in the finals show or elsewhere. Once you’re in AFTRA, you get paid for a lot of stuff.

And if they just wind up back home playing local gigs, their new celebrity can result in them earning significantly more and drawing bigger crowds.

The bottom line is that anyone in the top 12 can expect to earn at least $50,000 from the show. The top 10, at least $100,000. The winner can expect to become a millionaire, and maybe a massive star. The other top finishers who get record contracts will wind up making at least $500,000 from the show. as a guess.

All of them are locked into contracts if 19 Entertainment chooses to exercise its options, but only the top two or three are guaranteed a recording contract. The rest have to earn it on merit. This year, Pia Toscano has already signed with Interscope (Jimmy Iovine’s label affiliated with the show) despite being booted off the show early. She’ll wind up relatively wealthy as a result of the show so long as she has an even mildly successful career.

Information collected from various sources, but the most comprehensive one I found was this New York Times Article.

Feel free to add more information or ask questions and I’ll try to dig up the answer.

2

Do they get to keep the clothes?

3

Lol, the only one who wears anything worth keeping is Hayley. And James, I guess. But podunk Scotty hasn’t worn anything fancier than plaid shirts and jeans, and poor Lauren gets dressed up like an overgrown pageant kid.

4

According to this cite, the contestants buy their own clothes and presumably keep them, but the show gives them a $450 wardrobe allowance each week.

5

Wonder what would happen if they already had a pre-existing management contract with someone else…

6

Then they wouldn’t be able to sign the contract which allows them to enter the competition, presumably.

7

Ain’t that the pathetic truth. Her oversized cowboy boots make her look like a dork.

8

Thanks for all this info, Sam, I’ve been wondering about what kind of money they’re making.

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Sam, I recently read American Idol:The Untold Story, by Richard Rushfield. He claimed that the contestants who do the summer tour make about $100,000 each for the tour.

It’s a pretty good book.

10

Great thread Sam. Very interesting.

11

Good stuff, Sam. I commented that I thought James might be better off doing his own thing rather than being forced into pop music, but apparently he has no choice either way. That’s interesting. I wonder what the length of the contract is.

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I always figured that the “artistic freedom” angle comes from the notion that the Powers That Be would simply pay more attention to and be more invested in the winner than someone further down the food chain. Yes, 19 Entertainment would likely be producing or managing everyone in the Top 12, but I suspect they would be more involved in promoting and packaging the winner. It seems like the PR for “Winner of American Idol!” is easier than “Fourth Runner-up of American Idol!”, and so they might be more willing to give a runner-up their head in terms of what kind of music they put out.

Plus, with a few exceptions, it seems like the winners are (in my opinion) more…bland? Non-descript? than many of the runners-up. Something about the process seems to favor those who are a bit of a blank slate musically speaking, and so it might be that the label would find them easier to work with, and easier to make them into what the label wants.

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Crotalus: Thanks. I saw a couple of references to ‘six figure’ salaries for the tour, but they were offhand and uncited so I didn’t include them. The most ‘official’ thing I could find was the $10,000 number. But after seeing your comment I searched some more, and found another cite that said that they get paid a fee for each stop on the tour. So maybe the $10,000/mo was an earlier number when the tour was smaller. Let’s go with your $100,000 number as probably a better representation of what they make now.

Barkis is Willing: According to the New York Times article, a recording contract with 19 Entertainment binds the artist for up to 7 years, which is twice as long as a typical recording contract. Contestants can be released early if the studio doesn’t think they’re valuable enough to keep anymore, and I’m pretty sure I read of contestants that have gotten out of the contract after negotiations.

Nonetheless, it seems that the AI machine treats its Idols very well, even over-paying them based strictly on their music sales. They probably don’t want the bad publicity that might accrue if they screwed over the contestants, because the real pot of gold for them is the ad revenue the show brings in. They don’t need disgruntled ex-contestants running around telling the world how they were shafted, so they’re very generous.

It’s small potatoes anyway compared to the cost of the show itself. Jennifer Lopez gets $15 million alone for doing the show. Between all the judges and Ryan I’m guessing close to $40 million. The shows themselves probably cost a million or more each to produce, and I can’t imagine how much it costs to set up those big stadium auditions. So they can afford to be a little generous with the people they actually sign.
Something else I had wondered about: Does the show pay the families to come out and cheer? Apparently not. According to this cite, the families are given free tickets for the performances, but they have to find their own way to get there and pay for their own accommodations.

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CarlB: Good observations. You might be right that the lower-finishing contestants get more freedom simply because they the studio isn’t as invested in them. Also, it might be that they give them more freedom for purely artistic reasons and to take some risks - a contestant who breaks the mold and does something different and good gives the show more credibility. Melissa Doolittle got to make a straight-up soul and R&B album, so you could be on to something.

One exception to what you said: Not everyone in the top 10 gets a record contract. How many of the top contestants get 19E recording contracts really depends on how many of them 19E thinks are worth signing. In some seasons, only a couple of lower contestants got contracts.

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If you want to read an excellent account of what it’s like to be one of the top ten contestants who doesn’t get a recording contract with 19E, read Chris Sligh’s Blog. The post I linked to is excellent.

An Excerpt:

He goes on to talk about how to keep the momentum going and manage to build some kind of career out of the ashes of an ‘American Idol’ run. Bottom line: If you have songwriting talent and performing talent, and you’re willing to work really hard, being on the show will open enough doors that you have a shot as a reasonable career as a professional working musician. That means touring small clubs, playing a lot of gigs, writing a lot of songs for other artists and hoping they get picked up. etc.

I think that means that if you got on Idol but you don’t know how to write music or play instruments, and you finish in the top 10, you’ll get some walking around money from your experience and maybe a few performances after the show, but then you’re on your own, and you’ll probably fail and go back to what you were doing before AI came along.

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Fascinating thread. I’d wondered about this. Thanks, Sam Stone.

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A couple of contestants who otherwise would have gone on past Hollywood week have apparently been dropped for this reason.

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Yes, Great Info, thanks for the research.

After pimping Ford cars every week, each contestant should get a car from Ford. Or a least a pro-rated discount on a Ford car depending on how long they lasted.

About a year ago, I was at the casinos in Tunica Mississippi, and I saw a promotional poster and billboard for Danny Gokey (bleeech) who was performing at one of the casinos. I was wondering how much he was getting per performance.

I wonder if any the contestants will ever make the transition to GLEE.

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It’s a pretty predatory contract. No wonder no one of any genuine musical importance has ever been a contestant on the show.

I’m glad to see that most of them crash and burn and become miserable after their seasons. I find that gratifying.

20

Brian Johnson of AC/DC has this to say (if you can understand his Geordie accent).