A great show by CBC News about the future of music and the effect technology has on it. CBC News Explore’s BIG MUSIC looks at how Spotify, Ticketmaster, LiveNation, and Tik Tok are changing the very nature of music. It goes way back to the very beginning of recorded music and ownership of music, to the current moment of non-ownership. Great stuff!
"The labels are in a constant tug of war with digital streaming providers, who would rather their users listen to tracks that are cheaper to license, or podcasts with zero marginal costs. Artists feel like they can’t break through. Everyone feels squeezed" - Trapital's Dan Runcie points out in his latest memo as he's thinking about the music industry’s business model. "Music is always the first tech medium to be disrupted, but its companies are often the last to adapt to the changes. It could be time to flip that narrative, and it’s better late than never... Any significant change starts with the record labels" - Runcie believes, and offers a few ideas.
uper-producer and songwriter Jack Antonoff talked to the press after his Grammy win last night, addressing soaring concert ticket prices and the sustainability of pandemic-era touring for musicians. "The whole thing is incredibly tough. There's no reason why — if I can go online and buy a car and have it delivered to my house, why can't I buy a fucking ticket at the price that the artist wants it to be?... Let artists opt out of dynamic pricing. Stop taxing merch, and let artists sell tickets at a price that they actually believe. Don't turn a live show into a free market. That's really dirty. Charge what you think is fair". He also went into the motives behind the decision to become a musician: "We're a very easy group of people — historically, and not much has changed — to take advantage of because we didn't start doing it because of money."
Hipgnosis Songs Capital has announced that they have acquired Justin Bieber’s 100% interest in his Publishing Copyrights, Master Recordings and Neighboring Rights for Bieber’s entire back catalog, comprising over 290 titles released before December 31, 2021. The deal, worth $200 million, as reported by Billboard, is the largest rights sale for any artist of Bieber’s generation. It’s also Hipgnosis’ biggest acquisition to date.
"One of the most dramatic impacts that streaming has had on the record industry is been the democratization of listening" - Music Business Worldwide underlined a phenomenon that has happened in pop music in the streaming decade. The outgoing CEO of Warner Music Group, Steve Cooper puts it clearly, in numbers: “A decade ago, our Top 5 artists generated over 15% of our recorded music physical and digital revenue. In 2022, they generated just over 5%”. It's not just a decline in share of revenue; it’s a decline in actual revenue generated - Warner Music Group’s Top 5 recorded music artists in FY2012 look likely to have cumulatively generated a larger sum of annual digital and physical royalties (≈$274.5m) than WMG’s equivalent Top 5 artists generated in FY2022 (≈$193.4m). WMG’s overall recorded music royalties more than doubled in that period - $1.83bn in FY2012 vs. $3.87bn in FY2022. "As a result, in any given year, an ever-greater share of total streams is drifting away from the Top 10 biggest hits, and towards a much wider array of ‘middle class’ artists with significant, but not necessarily chart-bursting, fanbases" - MBW points out.
The global recorded music industry saw its wholesale revenues increase by USD $4.0 billion in 2021 to $25.9 billion, according to IFPI. That sum is the largest in history, MBW reports. Also, that $4 billion year-on-year increase was much higher than in the previous years - YOY growth in 2020 was $1.5bn, and in 2019 it was $1.5bn. Annual paid-for streaming revenues bounced up by $2.2 billion to $12.3 billion last year. Revenues from physical formats – CD and vinyl combined – grew to $5.0 billion in 2021, up from $4.3 billion in 2020. Ad-funded streaming platforms or free streaming, including video services, generated $4.6 billion in 2021, up 31% year-on-year.
Employment in the UK music industry plunged by 35% from 197,000 in 2019 to 128,000, UK Music unveiled in its This Is Music 2021 annual report. The report also shows that in 2020 music industry’s economic contribution fell 46% from £5.8bn to £3.1bn in 2020. Launching the report, UK Music called on the Government to introduce tax incentives and other employment-boosting measures to help the sector rebuild after the pandemic.
A number of digital service owners – including Spotify, Apple, Amazon, and Google – are trying to cut the amount of money they pay songwriters in the US to the “lowest royalty rates in history”. The National Music Publishers’ Association, on the other side, is looking to raise the current rate up to 20% of a streaming service’s annual revenues (it's 15,1% at the time). Music Business Worldwide tries to find out whether the music streaming services can actually afford to pay artists more.
Across 70 major and independent music companies, just 13.9% of top executives across were from underrepresented racial/ethnic groups, 4.2% were Black, and 13.9% were women - an authoritative new study from the USC Annenberg Inclusion Initiative has found. Across the members of the senior management teams at nine major companies as shown on their websites, only 18.8% of executive board members were from underrepresented racial/ethnic groups, 8.5% were Black and 30.8% were women. The report notes that half of the U.S. population are women, 14% are Black, and 40% identify with an underrepresented racial/ethnic group, LAist reports.
Video games is a sector which targets fundamentally the same market as music, and has done so outrageously well over the past two decades, Music Business Worldwide argues and looks to find lessons for music. MBW picks out five potential areas:
1. Embracing technology - every great new technology ultimately expands the market for entertainment
2. Diversity of channels - the increasingly overwhelming dominance of premium streaming means music is well on its way to being effectively a single format business again
3. Proactive marketing at all demographics - music may be universal but only a minority have an active commercial relationship with it
4. Deal with the limitations of exclusive rights - copyright needs to be used to facilitate new ideas, rather than to block them
5. View the consumers as an equal - more than ever, popular culture is about the fan as much as it is about the art itself
6. Music needs to embrace its future - the example of the games business shows the benefits of developing a portfolio of channels to market
