How much money do you make in the music industry

There are many ways to make money in the music industry. But where do most artists earn the bulk of their income? What are they doing to ypu a financially sustainable career? Though no two careers are exactly alike, there are basically eight income streams that most musicians rely on. Interested in finding out what they ro An article from TorrentFreak indicates that the top eight revenue streams for musicians are 5, artists were surveyed :. The article on TorrentFreak was originally published inand was also based on a study from In a word, no. Future of Music Coalition, for instance, has identified 42 revenue streams. The challenge is that these 42 sources would not apply to all artists. Not all musicians will win grants, nor will all generate ad revenue from blogging or YouTube videos. Not the best way to make money in the music industry. You could also earn from ads and commissions on affiliate products.

… and Getting That Music Played

Copyright — ownership of songs and albums as creative works — is a riotous knot of rules and processes in the music industry , with the players much more numerous and entangled than the ordinary fan might think. For music listeners, a song is a song is a song. But for the music business, every individual song is split into two separate copyrights: composition lyrics, melody and sound recording literally, the audio recording of the song. Sound recording copyrights are owned by recording artists and their record labels. Those parties may have nothing to do with the people who write the lyrics and melody of the song and thus own the composition copyright. For the majority of times when somebody listens to a song, both types of copyright kick in, generating two sets of royalties that are paid to the respective parties. Sometimes labels work with agents that can license bigger catalogs all at once, saving time and trouble but wedging in an extra fee. The specific percentage payouts within these deals depends on the type of service and the negotiating power of all the names involved. Putting music in film and television and commercials, a. A fee is paid upfront, and royalties are also paid once the particular film or television show has been distributed and broadcast. The process is further different for radio services, though, which typically use blanket, buffet-style licenses that determine payment rates on mass scale. That difference — which the music industry largely considers an unfair loophole — means that whenever a song is played over the airwaves, it only makes money for its writers, not artists. While album sales dwindle and streams may only pay out fractions of a cent at a time, live shows — be it tours, festivals or one-off concerts — are commanding some of the highest ticket prices ever. Another way musicians find side money is from YouTube monetization, wherein YouTube videos share in the profit from the ads that come tagged onto them. Selling non-music products like perfumes, paraphernalia and clothing lines is an easy money-making strategy that artists have been taking advantage of for decades — but in the digital era, musicians can also get creative with their methods, expanding well beyond traditional merch tents at concerts and posters on a website. More groups are releasing dedicated apps or subscription packages for their music or selling bespoke products like artist-curated festivals, email subscriptions and limited music releases. Pitbull has his own cruise. And yet, the average modern artist is still strapped for cash. By recent research estimates, U. Another reason: the sheer number of brokers, middlemen and other players in the music industry, as detailed above. Good news: The music industry has now accepted streaming as its revenue-leader and is poised to adapt around that, with many analysts and experts expecting that the business will streamline itself — with rewrites of law, new royalties negotiations, mergers, acquisitions and consolidations — into something leaner and, finally, more lucrative for musicians. Bad news: No one knows when that will be. The buzziest word in music this year is the one that used to be the most utterly boring. Recording and Writing Music … For music listeners, a song is a song is a song.

… and Getting That Music Played

At that point, global sales of recorded music were headed for their 13th decline in 14 years, with the overall value of the industry nearly cut by half since the turn of the century. It looked like the digital revolution really did turn the music business into a moldering husk. But now, like any good zombie during an apocalypse, the industry is once again primed to devour the world on a massive scale. Much of the rise is thanks to people paying for subscriptions to streaming music services.

Recording and Writing Music …

There’s a common misconception about how major musicians earn their money: In short, it’s all about having a hit song that breaks the top 40 music chart. But, as Bellas noted, «artists have always made the bulk of their money from live performances and touring. Jacobson, a music-industry lawyer based in Beverly Hills, whose work involves negotiating record contracts on behalf of artists ranging from up-and-coming artists to Grammy-winning musicians. Other common sources of revenue, according to Bellas, include sync licensing for example, when an artist sells the right to play their song on a T. Think, for example, of Rihanna’s makeup and lingerie lines, or the soundtrack to your favorite movie, or any ad campaign starring your favorite famous musician. Artists also have to deal with the issue of copyright, where revenues for their music are further split among publishing companies, music labels, and songwriters. So, despite common belief, getting signed to a label isn’t necessarily more lucrative for artists nowadays. With the constant changes in the ways people listen to music, the future of the industry, and what artists stand to gain, is unclear. Yet, a recent surge in music revenue paints an optimistic picture of where the industry is headed. According to the RIAA , music industry revenue has increased for two consecutive years. That’s the first time it’s happened since

Stratence Partners works with organisations of all sizes to help them increase their profit margins, market share and the value they can deliver to their respective industries. If the showpiece event is to command the attention it craves, though, it will need to start finding some solutions to long-standing problems. The music industry has shifted towards a subscription model, where listeners no longer own the music they love.

Such had been the rise in the use of recorded music, which was subsequently played on the radio, that musicians who had previously made their money through performing live were now finding work hard to come by. It seems strange now to think of musicians being against recorded music, but back then it was a relatively new concept and many artists were paid minuscule amounts of money in comparison to what they earned performing live.

The idea that people could own recordings of music, which they could then play as and when they liked, meant live musicians were reduced to getting their income from all-too-rare performances, or the meagre royalties that sales and radio plays generated. It did little to stop the rapid growth of record companies and the demand from the public for recorded music. Such was the appetite that it soon became the norm for people to have large collections of music, while record companies became all-powerful industry bodies that decided who became successful.

Ownership vs rental The idea of ownership of music by consumers is one that has only emerged since recorded music became popular. Consumers have come to assume they own the content they have purchased — and this also includes films and books. However, the rights holders of such content tend to be a combination of record labels that distribute it or pay for it to be made, and the artists who created it in the first place. The user is, in legal terms, merely licensing it.

Policing the use of licensed material became much harder, however, when the internet created an easy way of sharing content quickly, freely and in a manner difficult to detect.

Content rights holders found it hard to keep up with the many ways that were emerging to share their work. The dominance of record labels began to wane when the internet opened up alternative possibilities for musicians and fans who felt they had been short-changed by a bloated and cynical industry.

In their efforts to address the decline in sales caused by piracy, large and powerful rights holders scored a number of public relations own goals by going after individuals — including young children — who had traded their work. The record industry was slow and confused in its reaction to these changes, struggling to find a meaningful and steady form of income with which to replace dwindling sales.

It was hoped the music-buying public would be content with downloadable files from the likes of the iTunes Store; sustaining the content model of the labels that owned and distributed music, but turning it digital.

However, while the number of music files being legally downloaded has risen sharply over the last decade, a range of alternative services have emerged to challenge the way in which consumers access such content.

Streaming services such as Spotify and Rdio have attempted to turn people away from music ownership and towards a rental system based around advertising and subscriptions. In the world of film and television, Netflix has begun to make serious strides in cutting the number of pirated films downloaded, while presenting a challenge to the physical market.

Recent research has shown these services are both growing rapidly and curbing piracy. In Norway, research by Ipsos MMI found the number of songs pirated in was million — a mere Piracy of film and television had also halved in that period.

These figures could reflect a trend for the rest of the world, one in which streaming is killing off piracy and bringing in revenue for rights holders. But many argue the amounts paid to the holders — particularly by Spotify — are neither enough nor fair to newer musicians with fewer fans. The music industry has taken its time in finding a suitable model, but the ease of use and extensive catalogue that the leading streaming services offer mean there is now a viable alternative to piracy.

However, there needs to be regulations on copyright that are enforced, says Julian Hewitt, a music specialist and partner at Australia-based Media Arts Lawyers. Subscribers are still licensing the songs, but they have less control over what they can do with them — such as copying them and distributing them among their friends.

This has implications for artists and rights holders that have grown dependent on these sales. Does Spotify pay artists enough? The debate over what Spotify pays artists has raged since the company was launched in The rate has been criticised by many for being too low, particularly as those without a large fan base are seeing their work hosted on a service that allows people an unlimited number of plays. The debate had begun to simmer down in recent months, following a number of high-profile signings, including Pink Floyd and Metallica.

However, others, such as Coldplay and The Beatles, have remained off the service, and more are becoming disgruntled with the low royalty fees. Nigel Godrich — the acclaimed producer of artists including Radiohead, Beck and Paul McCartney — reignited the debate over what Spotify pays artists in July when he announced on Twitter that he was removing his music from the streaming site.

Godrich said the recently released album by Atoms for Peace — a project with Thom Yorke from Radiohead and Flea from the Red Hot Chilli Peppers — was taken down from Spotify in protest at the low royalty fees the service pays new artists. Mark Kelly, keyboardist for English band Marillion, disagrees. Furthermore, they pay through 70 percent of their revenue, as do Apple. Much of this money is being invested in nurturing new talent and producing some great new music.

There is a stark difference between the lifetime fees Spotify generates for artists and the one-off payment received for a single purchase or download. Also, as Spotify is a relatively new service with fewer paid-up members than iTunes, it is likely that, as it increases in popularity, it will be paying out much more to rights holders. They are happy to negotiate low-rates of royalties safe in the knowledge their extensive back catalogues will earn them money for years to come.

Struggling artists, on the other hand, might not be able to last quite so long with such a paltry — if steady — stream of income. One label that has a different stance to many is the Beggars Groupwhich pays its artists 50 percent of streaming revenue. All labels should follow the lead of Beggars Group and pay artists 50 percent of all streaming income. That, coupled with a 10 or fold increase in paying customers, would mean that streaming would become a valuable source of income for artists and labels alike.

Embracing technology Clearly, new technology is not going away, and the industry — both artist and label — needs to embrace it. The bottom line is technology is here to stay and how much money do you make in the music industry of technology is always going to go on. One service that is not paying enough to artists, according to Kelly, is YouTube.

Solving the problem of online music piracy has troubled the industry for well over a decade. The place to apply the pressure is the delivery system: the ISPs. They have been profiting from delivering creative content at ever-faster speeds while not paying us, the creators, a bean. Alternatives for artists Finding an alternative method has troubled both artists and executives.

From the perspective of an artist, some have looked to give away their songs, hoping their income will come from increased touring and merchandise sales. Others have used crowd-funding services such as Kickstarter and Bandcamp to raise money. Having spent their career at industry giant EMI, Radiohead decided not to sign a new contract, instead choosing, into offer their album In Rainbows to fans for whatever they felt like paying.

Inthe band released a new album in the traditional manner, through independent label XL Recordings. The consequence of this shift in how people see their media content — emphasising the license over actual ownership — might, in fact, have a profound effect on the control an artist can have over that music. It might make consumers realise the entertainment they enjoy is not really theirs to distribute and share, bringing to an end over a decade of rampant piracy.

Notice: JavaScript is required for this content. Sign up Subscribe. Business More in Business. Fall of the Norwegian pirates 1. The Beatles resisted iTunes for a long time, but eventually succumbed in late Illegal downloads: One of the biggest challenges currently facing the music industry.

Related topics: AppleSpotify. Sex, drugs and your new job role.

Recording and Writing Music …

A new report finds that mke are still poorly paid — but they stand to make more money as the music industry rebounds. As investors everywhere start to peer more closely at music-tech firms, Citigroup is offering them a comprehensive look at the state of finances in the music industry. In an ideal world, artists would be able to deliver their music directly to fans and take the majority, if not all, of the profit. But the music business is still largely operating on the systems that it used to use decades ago, when songs were sold in stores and owned in homes and not licensed and leased via the Internet as is the case with Spotify and its ilk. It notes that artists are already getting more of industry revenue than in past years through avenues like touring and self-releasing music — both of which generate much more money than a traditional record label deal. The current 12 percent figure was actually 7 percent in In addition, Citi predicts that the structure of the music industry itself will soon evolve to catch up with streaming and the digital invustry, leading to various companies consolidating and becoming music-media companies that can offer artists better deals. The spending patterns have changed. See Also. Popular on Rolling Stone. Newswire Powered by. Close the menu. Rolling Stone. Arrow Created with Sketch. Calendar Created with Sketch. Path Created with Sketch. Shape Created with Sketch. Plus Created with Sketch.