Off the Charts: Examining Musicians’ Income from Sound Recordings


Posted on June 12th, 2012 by Kristin Thomson in What We're Learning. 5 Comments

Technology’s impact on sound recordings

Even as our interviewees talked about the value of iTunes, just as many talked about the negative consequences of technology. While most of the attention has been on the negative impact of peer-to-peer filesharing on sound recording sales – a sentiment that was expressed by a number of interviewees – technology has affected sound recordings in other ways.

Investment

A business manager with urban and hip hop clients talked about the ripple effect that decreased sound recording sales have had on the entire music ecosystem:

“Do I feel that record sales are down because people can download music for free? No question. Do I think that we have artists who make less money because their record sales are down? Yes. When the artist makes less money then I think everybody does: the songwriter does, the producer does, the engineer does, everybody does.”
– Urban and Hip Hop Business Manager

Price

It’s also had an effect on price. One interviewee talked about how piracy has put downward pressure on how much they can charge:

“Well, records not selling as much is no secret and I don’t need to say why, but it is a reality. There’s a couple of frustrating things about it. In addition to illegal downloading, which I feel like has sort of plateaued and is going to start coming down again, there’s a downward pressure on how much you can charge for an album.”
– Indie Rock Composer/Performer

But we also talked to some musicians and composers who were using technology to make money off recorded music in new ways.  Technology makes it possible for musicians to do variable pricing, or bundle download sales with vinyl sales, stuff that was really difficult for individuals to do in the past.

Bundling

One fellow we interviewed had built his own download card system for his indie label artists, so that each person who bought a t-shirt at show got a copy of the album from their site:

“We have our own download card system in place. I, for one, definitely use that when I’m playing out, particularly with the vinyl. There’s a download card taped to the back of each record, and I try to do the same with t-shirts as well.”
– Tom, indie label owner and performer

Windowing

Technology also makes it possible for musicians to stagger the availability of their releases on various platforms, commonly referred to as windowing. The quote is too long to post, but another musician we talked to was directing fans to a Bandcamp-powered page to purchase a recent release because they had set up very specific bundled packages and variable pricing on the release. After about six months they also made it available on iTunes, but Bandcamp was the primary destination at first because that’s where they stood to make the most money, and deliver the best variety of products to the project’s fan base – it was where she could control the packaging and price points. By using Bandcamp in this ways she was, in essence, re-establishing exclusivity in a market that is all about ubiquity.

Digital performance royalties

Finally, technology has led to the development of an entire new revenue stream, and that’s digital performance royalties. A number of musicians talked about not only the promotional power of services like Sirius XM and Pandora, but also verified that it has become a legitimate source of income for them. A jazz publisher noted its ascendance:

“The Digital Millennium Copyright Act and the royalties that are collected for featured artists for digital broadcast by SoundExchange has become a real source of income…”
– Jazz Publisher

…as did a hard rock band guitarist, whose music is played frequently on specific satellite radio channels, and who was receiving money from SoundExchange because of it.

“Yeah, we do really well with college radio, but the increase the money I’ve really seen is from satellite radio.”
  – Hard Rock Band Guitarist

The growth of income from the digital performance of sound recordings should continue to increase as the marketplace matures.

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5 responses to “Off the Charts: Examining Musicians’ Income from Sound Recordings”

  1. […] Artist Revenue Streams has posted the latest study from their musician survey and it seems to confirm other hypotheses and trends regarding the […]

  2. […] The resulting income from sound recordings report includes dozens of charts and interviewee quotes that focus specifically on musicians’ income from sound recordings. In summary, the data suggests: […]

  3. […] The uptick in digital sales is credited primarily to the increase in streaming music services from companies like Spotify LTD and Pandora Media Inc., coupled with downloads from services like iTunes. Digital music sales now account for 41 percent of all music sales in the U.S. (Image via FutureofMusic.org) […]

  4. […] size allows a good insight into the revenue situation of the survey participants. In the blog post “Off the Charts: Examining Musicians’ Income from Sound Recordings”, project manager Kristin Thomas presents survey data on revenues from music streaming and […]

  5. […] “Off the Charts: Examining Musician’s Income from Sound Recordings” (via ARTIST REVENUE STREAMS) […]