When a major record label signs a contract with a band, the label assumes considerable financial risk.
Main Conclusion
It is only fair for a major label to take a large portion of the profits from the record sales of any band signed with it.
Intermediate Conclusion
The band does not need to assume nearly as much risk as it would if it produced its own records independently.
Premises
When a major record label signs a contract with a band, the label assumes considerable financial risk.
It pays for videos, album art, management, and promotions.