In most cases, you could have a situation where a label commits to doing a full-length record which is the standard I guess. In the case of dance or pop, you could actually even do a singles deal. A two or three album firm deal is probably the next step, and that's usually when there are two or three or four labels vying for an artist. I've seen some of the best records made for a couple of thousand dollars, or you could spend a half a million dollars. Michael Jackson might spend a million dollars making a record.
Labels typically spend about a million bucks in the first year to break a new act.
Then the label wants the band to tour so they buy them a van. Maybe we might want to do two videos. Then we probably want to do some independent promotion, hire some independent promotion people to help out with some key radio stations. Then say for example the band wants to buy some new equipment. Maybe the label wants to make some t-shirts or some weird promotional items.