Don't get me wrong -- I'm not making a value judgement. Take your pay in cash, in points, in publishing, in beer, I don't care, as long as both parties are fully aware of the scope of the deal. I would say that the "back end" model, particularly where smaller, independent artists are concerned, is essentially the equivalent of sweat equity in a startup company, the vast majority of which fail.
When one considers the time value of money, it probably works out better for most producers if they just earn their fee for services provided and call it a day. Of course, that represents a paradigm shift for most artists and record labels, and paradigm shifts almost never happen without pain being incurred by all involved.