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Following News the Music Industry Is to Receive a Big Windfall, Is It an Opportunity for Growth and Artist Compensation?
FOR many years…
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we are being told that, when it comes to money in music, there is not a lot around. Maybe that is a simplification but, in terms of established and new artists, there is a divide. Maybe mainstream acts who accrue a lot of views and streams online can make a living from their music but it seems, for everyone else, the reality is quite bleak. I think, even if an artist does get a lot of love online, the amount of money that comes their way is pretty meagre. The artist is the one who does all of the work and it seems, more and more, it is the label that gets most of the money. In terms of where most artists get their money from, I think merchandise and touring is more lucrative than streaming. That said…there is news that music industry experts – whatever they are! – say there is a windfall arriving. Because of the booming business we are seeing on sites like Spotify; the way the industry is turning right now, there is a lot more money in the kitty. I was reading an article that appeared on Pitchfork that predicted this boom. As is highlighted in the piece, it seems that record labels might enjoy the lion’s share:
“In recent years, several financial institutions have predicted record labels will soon be celebrating annual revenues that begin to approach, if not surpass, their late-1990s peaks: What was an inflation-adjusted $25 billion-per-year business before the millennium could bring in more than $41 billion annually by 2030, according to Goldman Sachs. The biggest record label out there, Universal Music Group, which was bought by French conglomerate Vivendi for $32 billion in 2000, before the CD market crashed, is now speculated to be worth up to $50 billion.
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The market is America and the U.K. is quite similar and, when it comes to the amount of money a professional can make, the figures are quite shocking:
A recent survey by the on-profit Music Industry Research Association found that the median income for an American professional musician in 2017, when the industry was already rebounding, was around $35,000. Of that, only $21,300 came from activity related to music, including live gigs, streaming, and merch. For everyday professional musicians, live shows were the most common source of income in 2017; the median amount earned was just $5,427. Most survey respondents said they don’t earn enough from music to cover their living expenses.
That wage might sound pretty okay but you have to remember, when you tally that against living costs and everyday expenses, does that leave you a lot? So many artists are breaking their backs and working ridiculous hours. It is the physical side of the industry – the touring and promotion – that seems to reap the greatest reward: conversely, it can take the most out of that artist in terms of their physical and mental wellbeing. I urge people to read the article on Pitchfork’s website because it makes for very illuminating and detailed reading – they break down the revenue artists earn and where that comes from (touring, ringtones and that sort of thing). There is a lot to be said for earing revenue through streaming but one has to wonder whether too much of the pie is going to the labels.
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Are we going to see a time when more of the revenue from streaming goes to the artist directly? Pitchfork found out and it seems, happily, that there is a light at the end of the tunnel:
According to the artists, managers, label executives, and industry observers I spoke with for this piece, streaming is transforming the music business in a way that should allow certain artists to keep a bigger share of the earnings from what they create. And yet, just as it’s been throughout the history of recorded music, most of the money will not go to artists
To that end, the Music Industry Research Association’s survey of working musicians suggests that streaming will have a long way to go before most artists can rely on it to pay the bills: Only 28 percent of the survey respondents indicated they made any money from streaming royalties in 2017, with the median amount totaling just $100. “If all of us just do this for free, these things will not exist,” says Katie Alice Greer, singer for rock trio Priests and co-founder of the indie label Sister Polygon. She tells me that although her imprint has tended to enjoy strong physical sales relative to its size, streaming revenue remains negligible”.
We are in an age where streaming seems to dominate and we see these ridiculous figures. A big artist might get several million streams for their latest hit and you’d think, with that sort of scope, they’d be in for some serious cash! It does seem that the physical product is more reliable when it comes to generate money – it makes me wonder whether streaming services need to think about the way they distribute revenue and whether everyone should be charged for using these services.
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I do think the news regarding an upswing warrants some celebration. Billions of dollars’ worth of revenue is expected to go into the industry and, whereas the artists are the ones doing the heavy lifting, let’s hope that the labels and bosses do not get too much! So many people I know look at the realities of being in the industry and fear they cannot afford to play and live – the realities of balancing a career in music and living. Smaller artists do not have the luxury of big labels and have to invest a lot of their own money into their careers. I would like to see the projects billions not only going to the artists but I think, going forward, we need to evaluate streaming services and negotiate a fairer deal for musicians. I do think a lot more needs to be done, in the U.S. and U.K., to preserve venues to ensure artists have a place to perform. I also think that mental and physical health issues are impacting heavily on the industry. Ensuring there is some sort of organisation or body that monitors artists and provides a safe space is essential. There are great charities out there but I would like to see a much more hands-on approach to protect artists and not put too much burden on their shoulders. Essentially, as so much of the money is coming from artists’ brilliant work, more cash needs to get into their pockets. It is obvious that financial demands and stresses and putting a huge pressure on artists and that can have a devastating effect.
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I am not suggesting the windfall the industry will receive can transform things and make artists, small and mainstream, wealthy and secure – I do not think that reality is possible. This predicted windfall, combined with a greater effort to ensure those who use streaming services pay for the music, can help create equity and a fairer deal for artists. Music is, of course, more than streaming and online popularity. There is the touring lifestyle and putting out physical products; getting into the studio and promoting the work. Given the fact (it is forecast) billions will be readied and waiting, maybe having a worldwide music body, one that designates money where it is needed, would be beneficial. It would be like the Red Cross for the music industry: having this central reserve and then disseminating portions of that money where it is needed would be great. I feel like the concerns around profitability in music is hampering the next generation. Many feel that there is no use recording music because you spend more than you earn. To be honest, money alone cannot ensure that every artist in the world is secure and safe: someone, somewhere is going to struggle and there are too many artists right now to make this utopia a reality. That, in itself, is depressing but you cannot throw money in every direction and expect everything to be solved.
More money comes from fan funding and live performance than it ever will from streaming – a platform where you can reach more people and get more exposure, ironically. Those who only have a small collection of fans are not privy to the benefits of streaming revenue. I think, with more money being injected, maybe making sure upcoming artists are at least slightly better off would be a good step. It is hard to make sure that the money generated goes to those most deserving. It is obvious that there is this big divide regarding which areas of money earn every artist the most (touring and fans) and how streaming revenue is distributed – too much to the labels and bosses and not enough to the humans who actually make the magic happen! I am pleased that there is a lot of good news regarding revenue and modern music. Wherever the finance goes, it shows that more people are experiencing music and there are plenty of options regarding strengthening and diversifying music – making sure there is a safety net for venues, artists and creatives. Not since the 1990s has there been this swell and sense of resurgence, it appears. I have every faith that those charged with sowing financial seeds in music’s wide and rich landscape will make the right decisions. Whilst we can rejoice regarding the financial forecast I implore those who have the power to remember the importance of the artist and ensure that enough money…
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GOES their way.