Really interesting piece of analysis by The Times Lab on the changing landscape of revenue in the music business (in the UK) between artists and the industry.
A few things jumped out at me:
1. It's the graph the music industry doesn't want you to see. It shows how artist revenues have actually increased in the era of file sharing while the revenue going to the industry has decreased. So, if you're business model is purely one of content distribution it's perhaps time to exit.
2. The fastest growing area of revenue is that of live shows. As the post points out, "at some point next year revenues from gigs payable to artists will for the first time overtake revenues accrued by labels from sales of recorded music". Not sure if this is a case of more people going to shows, more shows occurring or more profitable deals for artists, but it does suggest to me that this is perhaps evidence of the fact that we tend to enjoy doing stuff together. Perhaps music is the ultimate social good, rather than the private good record labels would like it to be.
3. Arguably, the last century of recorded music has been an anomaly in how we consume music and we're going back to how we have always enjoyed it - live and together. The content distributed is perhaps really no more than a calling card and artifact of something far bigger and more powerful.
Thanks for using three line colors in the graph that are almost indishtinguishable.
Posted by: Jeff | November 21, 2009 at 12:16 PM
i think you may be colorblind.
Posted by: T | November 21, 2009 at 12:42 PM
Please feel free to tell the times
Posted by: Gareth | November 21, 2009 at 03:25 PM
I agree with your analysis and the graph shows what you are trying to say.
Posted by: Articlescreen | November 22, 2009 at 06:01 AM
fundamentally, the music industry is flawed. bands should no longer want a record deal. promote yourself via social media, record music and sell it for cheap (or free downloads for band awareness) and play live like mad.
Posted by: verbal space | November 23, 2009 at 12:24 AM
really interesting data, although as someone whose other half makes a living from recorded music (and loathes how the labels have missed a trick at every opportunity to keep up with how the world works), I like to point out that the data doesn't quite tell the whole picture - doesn't change the point you make, but poss useful context:
1) long tail: PRS revenue is now made up of millions of micropayments as online sites are registering
2) the type of artists who are really benefiting from live revenues - apart from the long tail, a large chunk of the revenues are from the big pricey tours for established artists who already have a recorded music career, and who are most likely signed by one of the majors...
Posted by: Katy | November 23, 2009 at 01:46 PM
There's probably still money in distribution, just not using the current model. Myspace is arguably a profitable music distribution business, just nothing like Island Records. Also, it makes you wonder what's going to happen to TV revenues with companies like Blip.TV coming along ... (I don't have an answer there, I'm afraid)
Posted by: Simon Pearce | November 23, 2009 at 01:59 PM
I think this is awesome for musicians, you know, the people that actually do all the work and perform the music. Shouldn't they be able to collect a majority of the revenue. I think that the emergence of indie labels has been great for the industry. No longer can the huge labels control what the public listen to. Now the listeners have more control and are telling the labels what they want to hear.
Posted by: Promotional Products | November 26, 2009 at 11:45 PM
very interesting pieces of data. the internet overcomes traditional distribution models, also it kills mediocrity quicker. we still need a record label in identifying and promoting talent, just not as much. and some bands, because they are really good, don't need a record label. you still need a record label to make a very good band, big time. there is a huge leap from 2,000 person venues, to selling out a football stadium. you still need labels for that. funny a lot of very good things can get pretty big with all that much help. to get really big you need to bring the experts to accelerate the growth, kinda like natural training will only get you so far, after a certain point you need steroids. just ask barry bonds
Posted by: mark rukman | December 08, 2009 at 04:26 PM
So, if you're business model is purely one of content distribution it's perhaps time to exit.
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"1. It's the graph the music industry doesn't want you to see. It shows how artist revenues have actually increased in the era of file sharing while the revenue going to the industry has decreased. So, if you're business model is purely one of content distribution it's perhaps time to exit." Interesting find, still true today in 2010
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