LOS ANGELES — It is doubtful that any of the remaining 24 contestants on “American Idol” hope that they will be playing the Teen Angel in a touring production of “Grease” in Milwaukee three years from now.
Kris Allen, last year’s “American Idol” winner, has earned at least $650,000 from the show.
But that’s what Taylor Hicks, the 2006 American Idol winner, is doing. And it shows that winning the most popular talent competition in the country is no guarantee of superstardom.
Easing that potential pain are the substantial financial rewards promised to winners of “American Idol,” regardless of how many records they sell once the show ends. In the year since he stood under a confetti shower in the Nokia Theater here, Kris Allen, last year’s winner, has earned at least $650,000 from “American Idol,” according to contracts that last season’s contestants signed with the show’s producers during the competition.
That amount reflects the minimum a winner would earn. Including performance fees and merchandising royalties from the “American Idol” tour, as well as other opportunities, winners have never failed to earn less than $1 million in the year or so after the contest, people close to the show say.
It is not just the winner who cashes in; finalists who reach the Top 5 this season are likely to earn close to $100,000 from the show — and three to four times that if the “Idol” producers sign them to a record deal. The Top 12 contestants are guaranteed several thousand dollars for their efforts. And that is before accounting for the Top 10 finalists’ earnings for appearing in the summer’s “American Idol” tour.
These details emerged from copies of last year’s contracts filed in state court in Los Angeles under laws requiring court approval of entertainment-industry deals with minors.
Last season those laws applied to Allison Iraheta (who finished fourth) and Jasmine Murray (Top 13) and to three other contestants who reached the Top 36 but were eliminated in the semifinal round.
The winner and those finalists fortunate enough to secure a management contract with 19 Entertainment, a producer of “American Idol,” and a record deal, are likely to earn far more than they would if they were independent artists who found their own way to a recording deal.
“I’m shocked that they give them that much money,” said a longtime agent for recording artists who works at a major talent agency here. The agent spoke on the condition of anonymity because she had not seen the contract; portions of the deal were read to her by a reporter.
A respectable recording contract for a new artist today would include an advance of $100,000 to $150,000, the agent said, although she noted that the “Idol” contract potentially binds the artist to the show’s producers for up to seven years, roughly twice as long as a typical first contract.
Executives at 19 Entertainment declined to comment on the contracts. In a statement the company said: “Our business is built through strong, respectful relationships with our talent, so it is important that they are fairly represented in contractual agreements with 19 Entertainment. With ‘American Idol,’ we have deliberately structured these agreements to ensure that artists can cross the threshold of success, and that they have all the support necessary to achieve their dreams.”
Mr. Allen, last year’s winner, earned an advance of $350,000 for his first album, exclusive of recording costs, half of it paid soon after the competition ended and half when he finished recording. His self-titled first album sold 80,000 copies in its first week of release last fall — disappointing for an “Idol” winner — and 260,000 in its first three months, according to Mr. Allen’s Web site, krisallenofficial.com.
An Idol winner’s riches extend beyond the recording contract. Last year the Walt Disney World Resort in Florida opened “The American Idol Experience,” an interactive attraction.
To promote it, Disney paid Mr. Allen $100,000 to turn to a camera and shout, “I’m going to Disney World” after winning the competition and to visit the park, according to the contracts. He stood to earn another $100,000 for spending a day filming scripted dialogue segments for use in the attraction and for taping a vocal performance for the Walt Disney World Christmas Parade television show.
But wait — there’s more. Also according to the contracts, as the winner Mr. Allen has received a $100,000 advance on royalties from a three-year merchandising contract, which gives 19 Entertainment the right to use his image to promote goods and services.
Those $650,000 in earnings do not come without strings, of course, strings that bind “Idol” contestants to 19 Entertainment for years. The company can sign a management contract with any contestant it chooses, binding the contestant to pay 15 percent of his earnings, not including those from recording and merchandising contracts, to 19 Entertainment-related companies as a manager’s fee. The initial contract extends for three years, although 19 continues to collect a percentage of some of the contestant’s earnings for 10 years.
The winner is not the only contestant who earns after the show. Last year the runner-up — Adam Lambert, whose first-week album sales were more than double those of Mr. Allen — earned $300,000 in advance royalties for his album, a $75,000 merchandising contract and $50,000 in fees from Disney World for the Idol Experience attraction.
The remaining Top 5 finalists each received $50,000 from Disney for their participation, while the rest of the Top 12 finalists could have earned $200,000 each for a first album and $50,000 from merchandising if 19 Entertainment had exercised its option to sign them to a contract.
Contestants do not have to make it to the Top 5 to begin making money. Once they reach the Top 12, “American Idol” singers each week record a version of their song for sale on iTunes. Once they begin recording, they receive a one-time payment of $1,000 and a $1,000 advance on royalties for each recording.
When they make it to the Top 12, contestants also usually perform in a group number during each week’s results show. Because that performance is not part of the competition, the contestants earn performance fees under the union contract that broadcasters have with the American Federation of Television and Radio Artists, known as Aftra.
That contract pays the artists from $1,011 for a one-hour show to $1,540 for a two-hour episode, meaning that a Top 5 contestant is likely to earn close to $10,000 in performance fees over the season: not a fortune, but with 20 million people viewing each week, it is a start.
