What is the term of a recording contract, and what typically happens at its end?

• A. Term is the duration of the exclusivity period only.
• B. Term refers to the calendar year in which the agreement starts.
• C. Term is the duration of the agreement; it may include options to extend, and ownership or reversion of masters may be negotiated.
• D. Term is the number of tracks included in the deal.

Answer: (C)

Term is the duration of the agreement—the period during which the label has the rights to exploit the artist’s recordings. That duration is often defined as a set number of years or albums and may include option periods the label can trigger to extend the deal if certain milestones are met.

What happens at the end is negotiated. The label typically owns the masters produced during the term, but many contracts include reversion or sunset rights that allow the artist to regain control of those masters after the term ends (or after specified conditions are met) or under a new deal. If there’s no reversion provision, the label may continue to own and monetize the masters under a renewal or new licensing arrangement. In short, the end of the term centers on what happens to master ownership and the possibility of extending or renewing rights.