Begin the Begin: R.E.M.’S Early Years by Robert Dean Lurie:
Warner Bros. offered R.E.M. an appropriately artist-friendly deal. The band would have complete artistic control over its output—not just over the music itself, but also the album artwork, videos, and selection of singles. As with the previous deal with I.R.S., the Warner agreement was for five albums, which R.E.M. would deliver to the label completed and ready to go.
None of this was particularly new for the band. They already enjoyed a similar degree of freedom with I.R.S. What was different was the far greater promotional capabilities (and budget) Warner Bros. could offer, as well as a guarantee that I.R.S. would not have been able to accommodate: R.E.M. would own their master recordings. This marked a break with industry tradition: typically, the record label owned an artist’s recordings as a kind of insurance for the label putting up all the money in the first place. Whatever might transpire down the road—a falling-out, a public meltdown, even the death of the artist—the label could potentially recoup at least some of its investment via long-term sales of the recorded work. Under the R.E.M./Warner deal, the band agreed only to lease its recordings to the label for a predetermined period of time. Thereafter the band could either re-up with Warners for another stretch or take its product elsewhere.
It would have been difficult for any artist to walk away from such a deal. Warner were required to release whatever R.E.M. gave them. And R.E.M. could decide how much, or how little, they wished to promote that work; they wouldn’t have to tour, do interviews, or make videos if they didn’t feel like it. And, at the end of the day, R.E.M. would own every note of music they produced while under contract to Warner Bros. These factors, plus the warm relationship that had developed between the band and Lenny Waronker, gave Warners the edge over I.R.S.