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« Idol Thoughts… the 4 Key Factors That Michael Lynche Posseses That Make Him A Great American Idol & A Lifelong Artist | Main | Have you ridden a windhorse? »
Wednesday
Apr142010

Information Is Dangerous

Recently, a blog that I subscribe to (and respect) called Information Is Beautiful published a post titled How Much Do Music Artists Earn Online.

The title of post and the data within the accompanying chart is accurate enough to be interesting.  However I vehemently disagree with the premise, which seems to (unintentionally?) imply that somehow streaming, Last.FM or Spotify spins (or any new music technology) equate to something negative.  Bullshit.

If you have reached a point where your music is regularly generating 8,000,000 monthly shares on file sharing networks, and/or 4,000,000 monthly spins on Spotify, your train has left the station.

If by this point, you are not selling truckloads of stuff (tickets, music, merch, etc), and you don’t have sponsors pursuing you, than the only problem you have is that you are working with meatballs.

The graphic on Information Is Beautiful (oddly titled Selling Out) in the hands of a politician working on behalf of the dinosaurs employed by the recorded music industry will hurt you far more than it helps you.  Use the (just for fun) graphic below instead.

We didn’t have iTunes, Bit Torrent, streaming, Last.FM and Spotify five to ten years ago, but there are more artists earning great incomes today than ever.

 

Reader Comments (31)

Ah, Bruce, but the whole thing rests on actually ever reaching the position where "your music is regularly generating 8,000,000 monthly shares on file sharing networks, and/or 4,000,000 monthly spins on Spotify".

You may have noticed that it was my post that originally inspired the infographic (though David took it way beyond anything I could have conceived and kudos to him for that) and the numbers I quoted are based on my personal experience as a working (and selling) musician. It's a muso's life, mate, and I'm getting credited with numbers listed as $0.00 (fortunately, the detailed statement actually shows that there's some numbers trailing way back there). Statements like that just make your day, believe me.

The point I was trying to get across and I will reiterate strongly now was that only a few very lucky people will ever be in the position that you've presented. Most of my readers - and yours - can at best dream about ever reaching that level of popularity. We're talking Lady Gaga here and she has no problem doing all the stuff you've outlined. But that's not something for an independent artist to build their business plan around.

Streaming is being touted as the future of music, so I feel musicians should be aware just what they stand to earn from it. Realistically: so close to zero that it really doesn't make a difference. Facts of life.

As a promotional tool, streaming sevices may have a future. As an income source: no, unless their payouts increase (and I doubt they will). The best we can do is pray that they don't become the dominant format for music consumption.

Cut my just-for-fun graphic by 90 percent and you are still making money and having the time of your life..

April 14 | Unregistered CommenterBruce Warila

As in 800,000 swaps and 200,000 spins? You're being a little unrealistic, yes?

Seriously, in today's climate if you're getting numbers in the region of one-tenth of that as an independent artist, you're on top of the world.

Joking aside, having financial success when you're insanely popular is a no-brainer. You have to put some serious effort into making bad decisions to get burned.

The problem for a typical independent artist is generating enough cash to stay afloat. We don't have a single new model that enables this (okay, maybe iTunes, if we consider it a new model, possibly eMusic). The most sensible proposals I've seen thus far are based on clever use of old models (recording sales, merchandise, playing live) with the help of new tools enabled by the Web. It's good that they're there, but the viability of the old models is continually being challenged by the new ones that don't earn the artist any money worth speaking of (if any at all, were we to consider P2P as a "music business model").

To your point.. Streaming will probably be the future, and any artist comparing streaming revenue to other revenue sources (especially CDs) has his or her head stuck in the wrong place. Streaming and sharing = radio-like exposure. For an almost any artist willing to perform live, any amount of either is a positive thing.

April 14 | Unregistered CommenterBruce Warila

I agree with you there.

However, I fear the possibility where streaming becomes the major listening format. Radio and records worked well, because the record gave you choice, that radio did not. Streaming gives you choice, convenience, the whole package in fact. Once you can listen to streamed music anywhere and everywhere, why spend extra on something else?

We shouldn't ignore the potential economic effects on recording - especially by independent artists with little resources to spare - of such a scenario. I've said it before and I'll say it again, the Big Business will likely weather anything we care to throw at them and if we press them harder, they'll only have more incentive to offer their artists crappy terms (which said artists will gladly accept, because it's either that or failure).

Playing live ain't all it's cracked up to be: you have to be where the fans are, the fixed costs are high and the margins are low. It's not easy to break even, let alone make a decent income.

We can only hope for a new high-margin product. How are those FAT decks coming along?

Undoubtedly streaming helps with discovery and exposure, and for this Spotify is doing a wonderful job. I don't think it can truly be compared to terrestrial radio though, since both artists and writers get paid for exposure of their songs on radio. Streaming is more comparible to personal mix-tapes, internet radio and podcasts, since the renumeration to the artists/writers is so small as to be insignificant for even relatively well known artists.

To this extent, streaming doesn't hold out promise as a financial model although as a promotional tool (ie one that is considered a cost rather than an income stream) it is a useful part of the whole promotional arsenal.

I think that there is much more that could be done with streaming services to tie them into other artist activities - live work, upcoming albums etc. As a label or artist, there is a choice as to whether you allow full albums to be streamed on Spotify - it's always an option to just include one track from a new album. If that track could be tagged with information about where to buy gig tickets or the album and perhaps even a link to the artists' website/myspace/facebook page, then this would be an incentive for new fans to get more involved with the artist.

I saw that graphic today and got rather excited. Someone, I surmised, has dared poke the sleeping lion! Maybe, just maybe, Spotify is better for listners than it is for musicians -- on a financial level. It's obvious that going direct-to-fan, track for track, is always going to bring more money through the door. But I wonder if artists still think there's a magic bullet for overnight success, and that Spotify is the golden idol that might bring them to superstardom.

On a promotional level, it doesn't hurt to be on Spotify/Last.FM and the like, but for an artist getting started, trying to build a fanbase, and create the necessary foundation to reach the 8 million spins, 3rd party distributors of any kind (iTunes and their ilk included) isn't gonna cut it.

We need to stop thinking that there's some way to magically create another Lady Gaga. And we've got to start focusing on ways to develop smarter, focused musicians who can afford to make quality music with few constraints on the creative process.

Oh yeah, that's what Nimbit does.

April 14 | Unregistered CommenterScott Feldman

The infographic is only scary if you live in a bubble where your sole transaction is the sale of music. Thankfully, most of us in the real world don't operate in such a vacuum.

April 14 | Unregistered Commenterscottandrew

Krzysztof,

My point of inverting the Information Is Beautiful graphic was to show the absurdity of the implied premise. If you rise to the top and achieve the numbers bantered about here, disruptive technology (if you want to call it that) does not matter. Moreover, as far as I can see, the same logic applies to every rung on the ladder. A little popular equates to a little bit of sales (of stuff). Medium popular equates to more sales. Really popular equates to a lot of sales. It's always been that way, with or without the "disruptive" technology.

What has changed, is that the technology you might call disruptive (to old models) is truly empowering people to do it on their own, and they are!

What a contrast to the lunch I had yesterday with a producer/manager that works with middle-class, up-and-coming bands. He's so bullish and excited about how things are working today and about the future, (and about the money he's making) that he's doubling up on his commitment to invest in artists. I agree.

I am happy to be spending time with successful optimists. Perhaps you are a bit jaded and cynical :)

April 14 | Unregistered CommenterBruce Warila

I'm being realistic.

Perhaps I did not make it clear: most people will never rise to the top. The question is whether they'll still be able to have a career sufficient to pay the bills without rising to the top.

That depends on the revenues they can expect from the dominant model. My original point was that if we were still selling CDs, you could carve out a fairly comfortable niche for yourself using the new direct-to-fan tools and supplementing your income from recording sales with other streams, not necessarily having to "sing for your supper every night" - to quote Jaron Lanier.

Selling approx. 7,000 CDs a year is no small feat, I admit, but would have been well within the reach of a talented independent artist with good business sense and command of today's Web-empowered tools - were it not for the fact that people don't buy CDs all that much anymore. Those 7,000 CD sales would be enough to support a four-piece band that also played some live shows and sold some merchandise.

To put things in perspective: in order to achieve that level of sales you'd need 7,000 fans worldwide willing to spend just over $12 a year on CD Baby, your own recording studio and enough songs to put out one album a year. Nothing incredibly daunting. Certainly nothing outside the grasp of a smart, hard-working band.

With each iteration of the infographic, that minimum level of achievement increases - often by a factor of magnitude. All the models on there are substitutes: if you have the download, you've a lot less incentive to buy the CD (if you wanted both, it makes more sense to buy the CD and rip the tracks). If you can listen to on-demand streaming anywhere, why would you buy the download?

Given a choice, I wouldn't go back to the time before the Internet. There's a lot of good stuff out there, I agree. There are also major difficulties looming and since nobody's pointing them out, I've taken it upon myself to do so.

The people who read what you and I write are looking for ways they can improve their situation now. The promises they read, I feel are often overstated. To make informed decisions, people should also know the bad news.

Disagreements are a good thing, so let's continue to disagree. Nitpicking has forced me to consider issues that would not have crossed my mind otherwise. Through examining the thoughts of those who disagree with us we become smarter.

The best thing for discussions about the future of the music business is a discussion.

Bruce,

I think you're right, in that we can choose to look either positively or negatively (or a combination of the two, which I think is what Krzysztof is aiming for) at the music business today. And certainly a positive attitude will get you farther.

What I'm still dying to see, though, are examples of small, independent artists who are, as you say, doing it "on their own." Ariel Hyatt's series is the only thing I've found. Do you know of any other resources? Thanks.

April 14 | Unregistered CommenterKen Hiatt

Sometime I wonder if we are disagreeing or just living on different planets?

Pretend for a minute that there is not, and never was, the ability to sell recorded music. Take it off the table for a bit. Assume that all music is and always was - accessible and free, as this is the way young artists now view the world.

So you play for your supper. This is how the rest of the world works (mechanics, dentists, doctors, etc). However the artist (almost any art), due to the Internet, can grow the size of his or her table to include...the world. When it comes to art that can be digitized, it's one of few things that you can do - that can scale to include...the world. Try doing that with chicken nuggets, dental hygiene or brain surgery.

Each day, you grow the size of your table and today (because people still buy CDs at shows) you get a bit of "gravy" on top of your supper. However when the gravy runs out, does any un-jaded artist anywhere fail to stop growing (or hoping to grow) the size of the table? Absolutely not.

Artists now have the unprecedented ability to set and grow the size of their table; irregardless of whether or not they sell some gravy, and as the table grows, revenues grow.

This is really a glass-half-full or glass-half-empty debate.

If a young person spends time solely consuming your side of the debate, he or she may come to the conclusion that it's not worth pursuing a career as an artist. Conversely, I hope to inject hope into the equation, as I am absolutely sure that time will prove that as the cream rises to the top the rewards will be the same as, or greater than, they always have been. Moreover there's an entire middle layer that didn't seem to exist before - that is beginning to thrive now.

I just don't buy into, nor do I think it's helpful to cover, all the cranky rubbish about CD revenue versus everything else. It's pointless now. It's counter-productive and and it's negative. Sorry man, the kids mentally moved forward about three years ago..

April 14 | Unregistered CommenterBruce Warila

@ Ken,

I wish I had more time do document the evidence. I refer to the model as the "House of Blues" model (as a revenue target). Take a look at all of the artists going through the House of Blues or Filmore venues (all Live Nation), and you will find many more examples..

April 14 | Unregistered CommenterBruce Warila

I hear what you're saying about people consuming solely my point of view, Bruce.

Fortunately, I don't think there's much of a threat there. You guys outnumber me. :)

Besides, if you've watched Will Page's presentation that Andrew Dubber posted, you may recall that first cartoon that he put up. I see myself as running an Uncomfortable Truths stand and true enough, I don't get much business (though a lot more these days).

Besides, I'm still trying and still investing in my career, cynical though I am. I also read what the more optimistic side of the blogosphere writes and I am receptive to all good advice. Whenever I see what I consider bad advice, however, I will call it out. The readers can make up their own minds. If anything, looking at two sides of an issue gives them a better picture.

Finally, it may happen that what my late parents tried to impress upon me turns out to be true: that there is no realistic career in music. I haven't seen much concrete proof that the situation is otherwise - if there is, do let me know. Facts and figures, mind. If that is the case, should we pretend that it is otherwise, just to make our readers feel better about the choices they make? Should we pretend that we've got answers, when there are none to give, just so we maintain our readership?

Wouldn't that be real cynicism?

Agree that this infographic is a bit apples and oranges. That said, I've been on the fence about how streaming will impact my career. I still am.

First, I'm not sure that "Streaming and sharing = radio-like exposure". In addition to their obvious technical differences, I think exposure is overrated. Perhaps the exposure-model works if your goal is to be a superstar, or if your goal is to live on ad revenue. However, many DIY musicians (self-included) are already making a decent, clean living off direct sales, without any need, or desire, to be a mega star. Some of us don't even tour much, or even sell merch beyond CDs (I've resisted selling merch my entire career). This path has been possible only for the last 5-6 years (which was when DIY artists could start selling on iTunes & social media sprang up - allowing us to have a broad reach without a record-label budget). But...with streaming on the horizon, I do wonder if that window is closing and we'll go back to the world of the nobody masses and the megastar few?

Artists like me who've reveled in the decline of the mainstream industry and have been making a living during this window of DIY-heaven, will probably have to work harder to put a "face" on their "product" - in order to get the casual listener to pay for something that they can get easily for free. And I'm also not convinced the difference can be made up in ticket sales and merch.

My other thought, humans are lazy, its been proven over and over again that we take the easiest route. So I have a suspicion that whoever designs the streaming killer app will make purchasing music superfluous. As soon as you can call up whatever song you want in your car, you won't bother buying anything. I know I won't.

I'm not against streaming though. I love how convenient it is and I'm not one to stand in the way of innovation. I've made a compromise: half my music is streamable, the other half is download only (or for the savvy... torrent only ;-). I've come this far without any promotion or marketing...and I'm extremely tenacious...so I'm confident I'll find a way to continue to make a living off of music. However, the way the streaming models are setup now seems unfair to the DIYer. Am I mistaken, or don't the majors have a share in the profits of Spotify. So aren't they double or triple dipping? (royalties for all their artists + ad revenue + company profits). This doesn't seem very egalitarian, which is why I'm inclined to be distrustful.

Glad this is being discussed.

April 14 | Unregistered CommenterZoe Keating

There is also a major case of likening apples to bananas in both the originating post and by extension this post. If you sell your track on iTunes (or on a hard copy CD) you will sell it once per listener, at most (if we disregard second hand selling). If you get "spun" on Spotify/Last.FM you will get spun several times per customer.

The comparison here hinges on the fact that a customer who streams something from the internet will become a steady stream of income and the total price per track will be the number of plays over time, whilst a CD purchasing customer will pay the track price up front.
Comparing them at face value means little or nothing at all unless one assumes that the CD buyer will buy another CD if s/he wants to listen again, in fact nobody assumes that when calculating the revenues from CD sales.

However from streaming solutions the premise must be that the listener will listen again if s/he likes the track and thus comparing the instance price of one play does not hold.

April 15 | Unregistered Commenterandy

Krzysztof WIszniewski wrote:

"As a promotional tool, streaming services may have a future. As an income source: no, unless their payouts increase (and I doubt they will). The best we can do is pray that they don't become the dominant format for music consumption."

Let's take a step back and look at the situation today. 95 percent of digital music is piracy. This is the dominant format for digital music consumption. And this is the main fact to consider when talking about the future of music consumption.

In the past many people have tried to create on-demand services to compete with piracy. Most of those have failed because of high streaming rates. Some, like Rhapsody, has failed because of being premium only. Not many people likes to pay for something they haven't tested for a while. Also note the lack of digital music innovation in certain countries, for example Germany, because of collection societies demanding too high streaming rates.

Spotify does not have a high fixed streaming rate, but rather a system of sharing profits. This means that the first payments were small, because incomes were small. But it also means that payments have increased a lot over time. In fact, payments have increased every month since Spotify started! In Sweden 15-20 percent of the population has a Spotify account and Spotify generates much more income than iTunes here. This is possible because of all the people paying for Spotify premium.

Today Spotify have 7 million users. If they are allowed to enter new markets they have the potential to reach 100 million users in a couple of years. I mean, even with 20 million users the payouts are no doubt going to increase a lot.

Rhapsody peaked at 700.000 paying users, with the whole US as a market. Spotify, being invite only and available in six European countries, had 325.000 paying users some weeks ago and the numbers are going up quickly. If the music business as a whole is going to survive, we can only pray that Spotify (and other services) will be allowed to compete with piracy. And in the long run artists will profit from that.

April 15 | Unregistered CommenterJB

I don't see how streaming is going to have a significant impact one way or another.

From a promotional standpoint, streaming is certainly less effective than radio, since it is listener-defined. Radio has a captive audience for its playlist, so you have 50,000 people being exposed to the same song at the same time. In most cases, if you're being streamed, its because someone chose to stream you.

Furthermore, there is immensely more competition for listeners on the internet. There are more artists and more recordings now! And people aren't spending a significantly larger chunk of their incomes on music. Why is this fact being overlooked in the discussion? Streaming is certainly good, useful, and a great mode of communication. But its just one among others.

Spotify payments may be going up, but traditional cd sales continue to decline, and an increasing number of artists release something new each day. I doubt the ceiling for streaming revenue is high enough to offset any of these other trends.

CD sales are not the end-all and be-all, but there is a distinct difference between selling something and selling nothing. I haven't spent a dime on most of the artists that I have listened to and enjoyed in my life, though I certainly have paid money towards quite a few of them. As a listener, I am talking that proverbial "seat at the table" of many an artist who won't get a tip from me, because I jsut can't afford to spend that much on music, and in the digital age, paying is increasingly optional. I'm sure each of you does the same, to some degree.

Its getting very easy for the listener to migrate from table to table and choose not to pay. Meanwhile, the "dining hall" is adding more and more tables, more and more folks singing for their supper. The only thing that isn't getting added to this room is money. In fact, on the whole, there is significantly less money circulating in music than there was 10 years ago. More tables, more listeners, more opportunities, but less money.

I think you either need to focus on individual success stories, or predict a bright and sunny future, to see things as the glass half full.

April 15 | Unregistered CommenterJustin

Justin. Great comment. Can you verify this: "The only thing that isn't getting added to this room is money. In fact, on the whole, there is significantly less money circulating in music than there was 10 years ago. More tables, more listeners, more opportunities, but less money. "

I would say the opposite (as a guess)..

April 15 | Unregistered CommenterBruce Warila

Justin wrote:
"I don't see how streaming is going to have a significant impact one way or another.

From a promotional standpoint, streaming is certainly less effective than radio, since it is listener-defined. Radio has a captive audience for its playlist, so you have 50,000 people being exposed to the same song at the same time. In most cases, if you're being streamed, its because someone chose to stream you."

I'd say you are wrong about that. YouTube, a very popular streaming service for music, has proved to be much more effective than radio as a promotion tool. And if Spotify can grow big enough they will have the same viral potential. Radio will always be a pleasant alternative, but in the long run listeners will likely abandon commercial radio. We are already seeing this in Sweden for the youngest listeners.

Justin wrote:
"Furthermore, there is immensely more competition for listeners on the internet. There are more artists and more recordings now! And people aren't spending a significantly larger chunk of their incomes on music. Why is this fact being overlooked in the discussion?"

This is a good point and stats from Spotify show that royalties are much more evenly distributed in comparison with radio where a couple of big names get most of the money. As for spending money on music, I would like to repeat the fact that 95 percent of digital music is piracy. Many of those people are now paying for Spotify premium because they get a product that in many ways improves upon the pirate music experience. There is also a significant trend of people choosing to pay for live concerts rather than downloads or cds.

Justin wrote:
"I doubt the ceiling for streaming revenue is high enough to offset any of these other trends."

It remains to be seen. Just an example: Let's imagine Spotify with 50 million users. Ten percent choose to pay a tenner a month for premium. That's 50 million pounds in revenue every month and with targeted ads, ad income would be high as well. Still I doubt that streaming will be the only source of revenue for an artist in the future, but streaming will surely be an important part of the eco system.

A success story from Sweden is rookie artist Magnus Weideskog who went from being virtually unknown to getting 50.000 plays per day in Spotify. Now he is about to start touring. Thanks to audio ads in Spotify and word of mouth, the Swedish listeners discovered him. And sure, he is signed to Sony, which helps I guess, but I still think such promotional campaigns could work very well for indie artists. Especially if you could target the ads to certain listeners.

April 15 | Unregistered CommenterJB

Bruce, I don't have one monolithic statistic to prove my point, but business reporting on music sales for the last six or seven years has been pretty clear.

http://www.nytimes.com/2008/06/18/technology/18iht-music.4.13807545.html

"Global music sales dropped 8 percent to $19.4 billion in 2007, according to a report from the International Federation of the Phonographic Industry. Revenue came in at its slowest pace since at least 1997, the first year for which the body issued figures. Physical sales of CDs and DVDs fell 13 percent to $15.9 billion. Sales of downloaded songs and mobile-phone ringtones rose 34 percent to $2.9 billion.

Digital sales "are growing healthily but, crucially, not fast enough to arrest the overall decline of the market," said John Kennedy, chairman and chief executive of the industry group."


http://www.consumeraffairs.com/news04/2009/03/downloads.html

"Rising incidence of paid downloads is a positive development for the industry, but not all lost CD buyers are turning to digital music," said Russ Crupnick, entertainment industry analyst for The NPD Group.

NPD also reported that there were 13 million fewer music buyers in the U.S. last year, compared to the prior year, led by a 19 percent drop in CD sales. Only 58 percent of Internet users reported purchasing CDs or digital music downloads last year, versus 65 percent in 2007.
----------------

Speculation on the direct causes of this and its implications are open for debate, but I think its safe to say that there are either less people paying for music and/or people are spending less on it, thus leading to an ultimately smaller pile of money that an increasing number of artists are vying for.

April 15 | Unregistered CommenterJustin

JB, I'm certainly not trying to make a defense of radio, my hands-down least favorite way to listen to music. But I think you may be misreading my point. If you put an artist on youtube, there are slim chances of anything, whatsoever, happening. But put an artist that no one has ever heard before on a top-40 playlist, and they will be famous practically overnight. When you have a captive audience, you can market much more effectively.

I'm not saying that is fair, right, or the way I want things to go back to being. I'm just saying that internet streaming is a much, much more diffuse way of marketing. There's no entry barrier, so everyone has a presence. Thats oversaturation. There's no captive audience so the chances of someone choosing to listen to someone relatively unknown are quite slim.

I'm all for doing everything possible to promote, and I am by no means putting down web streaming as a viable avenue. I'm just saying that we shouldn't let it go to our heads as some cure-all.

Is youtube a better promotional system than the Radio? Sure, for the people who would be on the radio anyways. Everyone watched "Telephone." But they would have heard it on the radio anyways. Youtube is a better promotional system in that, when someone IS successfully promoted on it, they do better. The point I am making is that it is that I don't think there are many more artists who succeeded because of youtube (and the like) that would not have succeeded anyways in the radio era.

I'm not saying that these services are no good. Obviously people will be discovered through them and go on to successful careers, such as Mr. Weideskog there. But I question whether (1) people like him, or at least a comparable number of people, would not have succeeded anyways via more traditional marketing techniques, and (2) whether he is going to be making as much money, having broken into the industry, as he would have 20 years ago.

When record deals are signed, tours are booked, and agents taken on new clients, it is ALL done in respect to how much they, as stakeholders in the artists' career, can expect to get back on their investment. If there is less money to be had, they will invest less in their artists. They already are. And while there has been an admirable upswing in DIY projects making great stuff, the fact remains that the payoff is going to be less.

The story of the music industry for the past 10 years can be summed up in one big tradeoff: Give More Artists Opportunities, Pay Them Less Money. I'm not opposed to this reality. I think its a net good thing. But I also think its reality.

April 15 | Unregistered CommenterJustin

I think the thing to take away from this is the emerging (and disturbing) trend of these companies building a business model which hinges on paying musicians as little as possible.

I guess so long as they provide access to the musician (download & website link), musicians should really consider these services a promotional tool rather than a source of income. But it still doesn't make it right... (Musicians hear this all the time: "Hey... we can't pay you, but think of the exposure you'll get!)

April 15 | Unregistered CommenterJP

@Justin - Thanks for digging out those stats. I have most of them. I collect most of the stats this industry puts out, and then I eventually get around to putting them into MTT Stats.

I believe we would need to combine all the revenue sources available to artists and rightsholders to generate an accurate picture of income trends.

I read a lot and I talk to a lot of people. My informal research is telling me that incomes (from all sources combined) are trending up across the board.

I wish I had more time to supply concrete evidence.

-Bruce

It would be great news to hear that incomes are trending up. If that were the case, it would probably mean that I am wrong about the shrinking "pile of money" in the music industry. I certainly haven't seen any evidence to the contrary, however.

Of course its always possible that these stats are cherry picked by bigger companies to foment a sense of crisis. Or perhaps other forms of income like merchandise and touring have actually increased overall, but I doubt that as well.

I'm no statistician and I'm terrible at math. If you or anyone could put together an accurate picture of how artist incomes, on average, have changed while highlighting the sources of that income, that would be among the most useful pieces of data you could ask for. And I'm sure you could make a fun little graphic chart to go with it as well.

April 16 | Unregistered CommenterJustin

i don't wish to sound like a moaner here, this is an interesting debate. However in response to Bruce's last point (informal research suggesting incomes are increasing) I'd suggest that my own experience implies the opposite.

In 6 years as an independent musician I have released steadily more music, on more labels, in more formats, and my income has steadily declined, 20% last year. I play a broadly similar amount of shows (as many as I can get), but my fees are also declining; perhaps partly because of the recession, perhaps partly because there is now an oversupply of musicians who need gigs, perhaps partly because i am not popular enough?

As I said, I don't mean to whinge; I am now supplementing my inome with some freelance PR work, advertising on my blog, I'm in the process of starting merchandising and such; I'm now actually quite optimistic that I'll be able to make a living from music related stuff, the better to pay for my music hobby.

In my experience, the labels I work with, the agents I deal with, the artists I collaborate with, are all working a lot harder, releasing more music, handling more bookings and such to maintain their income stream. It's an interesting and exciting time for those who can afford to do it (i am lucky that I don't have a house, car, girlfriend or children, otherwise I'd be straight into a day job!)

April 19 | Unregistered Commentered

As a supplement to my side of the debate, check out this recent post (April 19th) on Coachella in Digital Music News.

April 19 | Unregistered CommenterBruce Warila

My suspicion is that there are very few records that go back far enough and are thorough enough to put this debate into perspective. Yes, you can refer to decades of economic info from the labels and publishers but where is the evidence of experience for artists in the world of pop? Is the percentage of active, recording, releasing musicians making any money at all really higher than ten years ago as a result of the internet? There's no way to know. The break even point is so different for each artist.

According to information collected earlier in the decade the amount of people making ANY money from music in Scotland (where I am) is so tiny it probably compares less favourably with blacksmiths. Unrecorded live fees, cash payments for CDs versus a steady stream of transport, rehearsal, equipment, printing, oh, endless, costs! This is such a messy business. Even dedicated org's like the Musicians Union won't know what's going on.

A new, perhaps more relevant chart, I would love to see, is promotional spend = ? sales, with added info on types of promo and through which media.

The mysteries of publicity revealed! Because, in theory, we can all do that...

Anyone know any PR people?

April 20 | Registered CommenterTim London

As far as the people go back to re-listen on Spotify so it generates an artist more money than an iTunes sale. My math says they'd need to listen to an album around 2000 times to generate a musician the same revenue as an iTunes sale & I imagine as more people use Spotify the payment per song play will actually go down instead of up. I don't know, according to CD Baby I get $0.0003 per Spotify play & that's where I'm getting my numbers.

On the PR end, my label Silber I run all the promo myself (a couple hundred discs per release, about 100 press & 100 radio & then a couple thousand people get free download links) & get a lot more reviews & radio play than labels that sell ten times as many units. Because (for me) it is easier to get things like reviews & airplay than it is to build the necessary relationships with record stores & distributors (which is still very important) to get a push in that way. The only places I have ever seen generate a sales spike are reviews in Side-Line & on Pitchfork (of course) & airplay on SomaFM. So maybe I should start sending out only the three promos.

April 21 | Unregistered CommenterBrian Mitchell

In my experience as a label owner there are two points to be said about streaming music

First: It costs nothing or next to nothing to get your music to the customer. Compared to the cost for pressing CDs, having CD artwork made printable, buying a UPC code, sending out CDs, paying for distribution (CD Baby takes 30 $ for every CD they set up - and they are very very cheap), storage room for CDs, sometimes for the destruction of unsaleable CDs, .... the cost to set up an account for digital download and streaming is nothing.
So at this point have already saved about a thousand dollars.

The second point I make is that it is MUCH EASIER to get someone to listen to an unknown artist on streaming sites like Deezer, eMusic, Napster ... (I do not know about Spotify, haven´t set up an account there) because people will rather risk a percentage of a cent to hear something new than spend a dollar on a song they don´t know. The barrier is lowered.
oh and remember: Most of the musicians I know offer free streaming on their sites, myspace, youtube so why do they complain about getting paid for streaming?

Something personal at the end: I would much rather buy Vinyl than a CD and much rather a CD than an mp3. It´s something haptic. I like the touch, I like to handle, I like the look. No mp3 can ever give me that.
I did a recording session with a horn section the other day. They are just producing an album. When it is released, I will buy it at once.
Not only are they producing Vinyl and CDs, they have also made an artwork booklet with comics (that got them a lot of recognition at a comic convention) Tell you what, their music is great, but I´d never download it no way. But have a 2010 produced record with a comic booklet sit in my record collection is something I cannot resist.

April 24 | Unregistered CommenterHeidi

I knew there was something that bothered me about that revenue infographic but I couldn't quite place it. You've hit the nail on the head. Nice one.

June 16 | Unregistered Commenterryanve

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