Hurting the musicians.
If you like music, this is really important. The architecture of online music distribution has been amazing for the consumer. With iTunes or Pandora or eMusic, the savvy listener can get just about whatever she wants whenever she wants it, and for cheap. Of course, the problem of piracy was killing off the record labels, though it must be said that the record labels didn’t make themselves at all sympathetic. Most of us took comfort in the idea that the internet would flatten out the relationship between the musician and the listener. We believed that in the digital era musicians would make it on their own without the labels.
Those of us who believed such things? We were wrong.
There’s an important chart at Information is Beautiful showing how much music a solo artist would have to distribute in order to make minimum wage. One answer: 155 physical CDs on CDBaby. Another answer: 1,229 album downloads on iTunes. One more answer: just under 850,000 plays per month on the Rhapsody music service. Chances of making a decent living? I’d say they’re rather slim. And think about the situation for, say, a five-member band.
Technologist/musician Jaron Lanier has challenged those who are optimistic about digital culture to provide examples of musicians and artists who have used an internet distribution model — basically, giving the art away for cheap or free in order to sell merch and promote concerts — to make a real living. The set of musicians who have thrived in this environment contains only Jonathan Coulton. (I’d give a link, but I read this in Lanier’s book.)
You can certainly make the argument that our musical culture is going to be better off with more part-timers and fewer professional musicians. I’m not sure this is right, but it’s worth talking about. But anyone who will still tell you that there’s a future for middle-class professional musicians (and with whole system of session musicians and recording engineers that supports them) is wrong. We’re getting a lot of cheap and free stuff, but we’re destroying an artistic middle class in the process.
(Credit where credit’s due: my friend Tim tweeted about the Information Is Beautiful chart. Also, a commenter on the chart’s page points out that the chart compares some $0.99 downloads to the $9.99 albums, so you might want to mentally reshuffle the list.)
UPDATE: I really should have clicked through to the post the chart was based on, by the Cynical Musician. It’s worth reading. For example:
…in terms of generating realistic income, the CD is still our best bet. The direct digital replacement – bundled download sales – is comparable. Unbundled track downloads increase the number of necessary transactions by a factor of magnitude and subscription-based downloads by yet another. The supposed future of recordings on the Internet – cloud-based streaming – barely deserves mention. I can’t imagine an independent artist receiving millions of streams a year, much less hundreds of millions.
The chart clearly demonstrates that royalties suck, but it doesn’t actually say anything about what kind of money musicians really make since presumably the merch and concerts which (apparently) only Jonathan Coulton is actually selling account for more profits than royalties do. Is the Lanier book good? I’m not familiar with his work. Does he offer any solutions?Report
@Patrick, Lanier wants the internet restructured so that you pay for the bits that you download, but you also get paid for the bits that you produce. He knows that this won’t happen without significant federal legislation.
Lanier’s book is pretty good: it’s got some really strong ideas, and Lanier himself is a fascinating guy, but large parts of it are cobbled together from various essays, so it doesn’t hang together as well as it could.Report
I am confident that the consumer will be just fine and I really don’t care about the record labels, though it’s hard not to feel at least a little bad for the artists that are going to have to take day jobs when music is their real calling. I’m not being sarcastic. My best friend is like that. He may take another job, but he’s kinda stuck being a musician.
My main question here is the extent to which there was a middle class before. I agree that what many expected to happen did not, but my impression was that it already was either-or. Either you made it or you scraped by on live shows and relatively minimal CD sales.
The music scene where I’m from had a fair number of artists doing the latter for surprisingly long periods of time. I would be surprised if their CD sales could even pay the booth guy (if they had one and weren’t using a local volunteer). I definitely never got the impression they were doing more than scraping by on the kind of wages that they would be getting at a convenience store.
One of them (who’s still doing it, ten years later) had what I thought was great model. You could download all manner of live recordings and b-side stuff but if you wanted the real deal you did have to buy the CD. It both got me hooked on the guy and made me shell out money a broke college student shouldn’t have been shelling out. Probably too late for that model to work now, though.Report
@Trumwill, I think the system worked better back in the ’80s than it did in the ’90s. I have a highly speculative theory about this, but I will probably save it for another post.Report
@William Brafford, do tell. Now or later.Report
Maybe I’m misreading the chart, but wouldn’t a better comparison than the CDBaby vs. iTunes pairing be “retail album CD” vs. iTunes?
CDBaby specializes in direct sales between artist and listener, which is of course much more profitable for the artist than going through a middle man — like in iTunes or a retail situation — but it’s hardly the model on which the music industry was based, as it’s exactly the sort of high-profit, low-volume sales model which has sprung up in the digital era (long tail and all that).
CDBaby is more properly analogous to “self pressed album”, i.e. the cheap albums you buy direct from the artist at their show. Except that you don’t have to go to their show to buy it.
The really interesting thing I see in the chart — and it is an interesting chart — is that the labels are apparently vacuuming up the additional profits from digital distribution (see iTunes, label profit of $6.29, vs. retail CD, label profit of $2.00), and reaping the benefits of decreased production costs without passing those on to the artists.Report
@Rob, I think you’ve got it right.Report
Back to the future. Recall that in the past (pre 1800) musicians either worked in the church or for a prince. Starting in 1800 we had some that were able to exist outside that structure and more and more with the development of recording. Now its going back to the old model the money will be in live performances only. To see the future look at the classical side where since the basic product is public domain orchestras are having a hard time making ends meet and cd sales are falling off (after all how many copies of Beethovens 9th does one need).Report
@Lyle, but there was so much more demand for live music before recording. The only way you could get music was to get someone to play it, or to learn to play it yourself. I doubt that a large and healthy culture of live music will be possible, though I’m pretty optimistic about certain local scenes.Report
Wasn’t there just a report recently from England showing that musicians are doing just fine because they are making more money from concerts even though they are making less on royalties for reproducing their music? Ars Technica cited it. The trick is that file sharing encourages concert attendance. Most of the musicians I know make their money from performances. Reproduction royalties are just gravy.
Interestingly, I know at least one comic book artist who basically has an old fashioned patron. (It doesn’t always have to be a prince, though I gather he’s a pretty nice guy.)Report
@Kaleberg, I don’t know about England. Most of the independent musicians I know have day jobs that are flexible enough to let them take time to tour. All the full-timers I know of rely on CD sales. (Although I can think of one band that I’ve heard has a sort of patron.)Report
Maybe I’m misreading the chart, but something strikes me as off wrt the label revenue, especially on CDs. I assume the royalty numbers for the artists are about right, but other numbers just seem off. For starters, unless prices have dropped dramatically in the last year or so, I’m surprised to see a retail CD listed at $9.99, even for a low-to-middle tier artist. Even 13 years ago when I last worked for a retail record chain, $9.99 was the lowest “on-sale” price for even the emerging artists, and the least-expensive non-sale price for a new album was typically in the $11.99-$12.99 range. I last shopped for a CD in a retail outlet about 2 years ago, and I recall that if anything those price points had increased.
The other thing that strikes me as off is that the chart lists only $2.00 in label revenue on retail CD sales and only $2.30-$3.00 in combined artist + label revenue on such sales, with the remaining $6.99 (assuming the $9.99 price point) eaten up by the retail outlet and production. Even at a 100% markup by the retail outlet (which is fairly standard, IIRC), that still means that the production cost to the record label is $2.00 a CD – i.e., the same as the production cost of a self-pressed CD. I know enough about economies of scale to know that this is not even remotely possible.
Point being that the chart seems to be significantly understating the extent to which record labels eat up the revenues from retail CD sales. Regardless, the chart seems to show that the number of album downloads necessary to achieve parity with retail CD sales from the perspective of the artist is about the same.
What this means, though, I’m not at all sure.Report
I have a friend in a moderately successful band who is still in debt to the big label. On the other hand, he’s parlayed his moderate success into starting his own label. On the third hand, his label’s not yet broke even.Report
@Rufus, trying to make it as a rock band on a major label has always been a roulette wheel. The chart doesn’t account for recording costs at all, and record companies take their advances out of profits. The only good way to sign to a major is to do it the way that Death Cab for Cutie did it: get famous enough that you can dictate your own terms.Report
I agree with the others. It looks like on these charts at least the labels are sucking up the money at considerable cost to the artists. I wonder, though, how long this can last. Coming off the old institutional structure the status quos would leave the money in the hands of the labels but their control is looser now than before. Perhaps what we need to see will be a new generation of artists who are also very savvy with these new distribution models and will have both the know how and the leverage to buck the parasitic old labels.Report
@North, I don’t think distribution is the issue. I think the issue (and the main service provided by record labels) is marketing. Getting your name out there. Getting your songs on the radio. That sort of thing. Also perhaps making your material appeal to the widest possible audience. But for a band that already has their sound, marketing.Report
@Trumwill, Fair enuff Trumwill, so replace distribution for marketing and the original thrust of my opinion remains.Report
@North, you’ll have to let me know when this savvy new generation of professional musicians appears.Report
@William Brafford,
Beats me, I don’t know if they will WB. It seems to me that we have changed from a media of distribution that has fewer barriers to entry than before so I would think that at some point some creative person is going to figure out a way to make it really work for them. But who knows, maybe we’re seeing the end of the gilded age of music.Report
The thing to remember is that although the labels may be sucking up a lot of the money, and although they may well be sucking up more of the money than many of us would say they deserve, they’re actually not just taking it and giving nothing back. I mean, record labels are about as easy a target as you can find—they’re not just Evil Corporations, but Evil Corporations Who Suck the Lifeblood Out of Artists and Art, Man—but the truth is, these large companies do do things for bands.
Not for all bands, certainly. But I think it’s presumptuous to think that the artists who have succeeded could have done all the extra-musical legwork, as it were, on their own; that it just takes a little hustle and moxie. John Scalzi has a pretty good post on the topic as it pertains to authors and publishers, and I’d be surprised if the two models were terribly different in this respect.
Commercial art has always been about patronage; it’s just that in the 20th century, the costs were transferred to consumers. As far as I’ve always understood it, with regard to music, books, and movies (and probably TV), you have a relatively small number of hit artists who bring in enough revenue to sustain the careers of many more less popular artists. I think you sorta have to have some sort of multi-artist business model to make long-term careers in commercial art possible. A single band (much less a lone singer-songwriter) not only probably doesn’t have the time and energy to get a career off the ground and then sustain it without an organization to take on outside duties, but they’re also screwed if anything goes wrong. Drummer gets sick, emergency forces canceled shows, third album flops—how do you recover if there isn’t someone bigger who can help you out a little?
I do expect there will be a reorganization of entertainment distribution. I wouldn’t be surprised to see smaller labels become the norm (I wouldn’t be surprised to see smaller companies in general become the norm, and how great that would be), and I wouldn’t be surprised if artists almost never made the gargantuan sums they used to (and still do, in a few cases). But for all the hoopla about new media facilitating DIY endeavors, I’ll be awful surprised if the reality isn’t reasonably similar to what we’ve got now.Report
@Josh, it would take a much longer post to try to sort out the good and bad of record labels. For the labels to take on the risk is not a bad idea in principle, but it seems like the majors’ business model became particularly abusive toward the artists who didn’t “make it.” I think this is partially a function of the faddishness of pop music: a jazz or folk label would be more interested in keeping artists around for the long-term.
If there really is a way for well-marketed pop artists to make a living from performances rather than recordings, we’ll surely see label-like organizations managing rosters of performers.Report
@William Brafford: Yeah, clearly, the labels have not always acted wisely or benevolently, or even self-interestedly (if that last is a word), particularly when it comes to pop. But again, that behavior isn’t necessarily that different from how publishers and studios act. I kinda wonder if the situation for musicians doesn’t seem so much worse in part because of the fact that in music, it’s one individual or group against the Man; and in part because there’s a certain cultural valence musicians occupy that other artists don’t quite, where getting away with outrageous behavior and put-uponness are part of the package. The clichés “rock star” and “prima donna” both came from the music world to pervade regular discourse, and I’m not sure there are analogues in other art forms.Report
Regarding the music industry, bands making money and such, this is a great article:
http://www.toomuchjoy.com/index.php/2009/12/my-hilarious-warner-bros-royalty-statement/
The system is not particularly arranged for musicians to make a living. They have passion so they are open to being used by those with some level of access.
I’ve been using Jamendo a bit recently. Its a great thing, but there are so many artists and so many other places to get music i can’t see how it is all that viable for artists to make much money. However it does give exposure. On the other hand the Internet Live Music Archive is 20 kinds of awesome.
It is a great time to be a music fan. I was in the college radio scene in the 80’s and greatly preoccupied with music. I don’t know if i would have finished college if i had all the music options, let alone my ipod , back then.Report
@greginak, fascinating link. Thanks!Report
It’s interesting I guess that we take such great concern in the financial futures of musicians. Music is first and foremost a hobby. Some people roll it into a career, many don’t. It’s like any other art form. How many people paint in their garage for 40 years and never sell a painting? Where’s the concern there?
I’ve played on 2 CD’s now and I did it for free because I enjoyed the experience. The CD’s were small distribution and everyone involved did it as a labor of love, not for profit. It’s the same with playing live shows. I’ve played more than one gig for nothing but free beers from the bar. I would maintain that I have enjoyed playing bars with 20 people as much or more than playing a festival with 5,000. Some musicians have a big ego and need the validation of fame. Many, many more don’t. I enjoy playing live music. It’s a hobby and I also love my day job.
Online sales and sharing is a fantastic way to get your music in the hands of people far away. The band I used to play with would occasionally get emails from someone in a far away place who had downloaded the music from someone else. We just liked knowing we were out there.
The fact of the matter is, if you want to make a living as a musician, play lots of shows and pray. Depending on record sales is a bad idea.Report
@Mike at The Big Stick, I don’t think it’s that odd. First, there have always been people who took an interest in the livelihood of musicians, simply because they wanted to promote the composition and performance of good music; it’s just, again, that the role of patron has been handed off from the aristocracy to the public at large. Second and on that note, we listen to a lot of music. We’ve become accustomed to a system that promotes the availability of a wide variety of high-quality recorded and live music. I don’t know that people care so much about individual musicians and bands making a living as the fact that if they can’t, our supply might be diminished.Report
@Josh, One could also argue the quality is better – or at least more honest – without the input of record labels.Report
@Mike at The Big Stick, I am increasingly finding this to be true. As the ability to home-record and cheaply record new material becomes more commonplace, I am more and more appreciating the more independent sounds of artists that do their thing with less input.Report
@Mike at The Big Stick: One could. But as far as, like, production quality goes, the DIY software available now doesn’t match what you’ll get from a professional recording studio and professional engineers, from what I’ve heard from audiophiles. That’s a contestable point, though, because (1) most of us are listening to music on lower-fidelity delivery devices like iPods and computer speakers now, and (2) I think there’s a fair amount of stuff recorded with DIY software being released by labels anyway, because it’s not like the labels are flush.
What I would argue instead is that to become better artists, most musicians need to be able to focus on their music. Unless you’re an exception, you just can’t put out increasingly better songs and albums on a regular basis and learn to put on good live shows and promote your work and keep track of the bookkeeping so that you don’t starve and have friends and a family and a life.
Honesty? Maybe you mean something different, but I don’t really buy into the “The Man is always trying to cramp our style” argument. The oppressed and misunderstood artist, and specifically the oppressed and misunderstood musician, is a nice romantic figure, but if stories like the one about Wilco’s Yankee Hotel Foxtrot were the norm—well, we wouldn’t have made such a fuss over the story about Yankee Hotel Foxtrot. Plus, I mean, goodness, there’s no dearth of honest music around, much of it released by big labels.Report
@Josh, I would also add that the consumer shares an emotional connection with the artist that he does not share with the promoter, producer agent, and so on. Even in a world without everybody supporting the musician to make him or her sound better where recordings sounded more raw and less fleshed out, we would still want to know that the musician is doing okay in an abstract sort of way.Report
@Trumwill, that’s true. Same thing with writers, I think: You want to imagine this person is making a living. And if you like the work, you want to think there’ll be more of it!Report
@Mike at The Big Stick, I have to say that I agree with a lot of what you said, especially the part about how we musicians love to play and thus we sometimes do it for the sheer joy of it.
That still does not mean that we don’t deserve to be paid for it though. Especially a musician who takes the time to learn multiple instruments, and the craft of songwriting, then also shells out the money to get a decent recording (which is pricey to say the least). I myself don’t care if I ever play in front of large groups of people, but I really want to be able to record the numerous songs floating around in my head. If I can’t at least break even on what it might take me to produce a professional quality album, much less make a profit so that I can afford to do another one. Where does that leave our musicians? I guess that is a rhetorical question, because there isn’t much we can do about the cost of equipment, engineering and studio time. Or the free distribution of our artwork that we have spent lots of time and money on. I guess what I’m trying to say, is yes, it is fantastic to know that people are listening to your music, and that they really like it. However, it would be much nicer to know that, and get paid for the service.Report
@Joshua 121, I guess I don’t know that it’s a ‘service’. If someone wants to buy an album, sure, they should pay. The argument though for pay is that musicians are creating a commodity. Is that true? Are they just capitalists with a product to sell?Report