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osewalrusThe latest report by Citibank, reported in this Techdirt article shows that only 12% of revenue from the music industry goes to artists, with most of the remainder going to the major labels (another small chunk goes to lyric writers, and the rest goes to various other middlemen such as concert promoters and distributors).
The report further notes that this is not a function of declining music revenues. To the countries, music revenues match their peak year of 2006, hitting $43 billion in the U.S. And indeed, the rise to 12% is an improvement since 2000, when artist percentage was only 7% of total industry revenue. The rise in artist share comes primarily from live performances, which traditionally have circumvented the monopoly control of the major labels. As Techdirt notes, however, that is likely to decline going forward as the labels increasingly impose what are called "360 contracts" on artists -- which require them to pay the labels a percentage of revenue earned from live performances. I'll add that another important point is that most labels require artists to pay their own production costs, with the initial pay out of money to the artist and the record production costs constituting a debt the artist owes the label that the artist must pay off through sales of the album that come out of the artists share of the royalty. (It would be as if the publishing industry included the cost of publishing the book as part of the author's advance).
In short, the monopoly/cartel that is the music industry does a heck of a job squeezing revenue from artists. Which makes claims that they speak for artists in policy debates rather horribly laughable.
Citibank report: https://ir.citi.com/NhxmHW7xb0tkWiqOOG0NuPDM3pVGJpVzXMw7n+Zg4AfFFX+eFqDYNfND+0hUxxXA
Techdirt story: https://www.techdirt.com/articles/20180819/00051140461/only-12-music-revenue-goes-to-actual-artists.shtml
The report further notes that this is not a function of declining music revenues. To the countries, music revenues match their peak year of 2006, hitting $43 billion in the U.S. And indeed, the rise to 12% is an improvement since 2000, when artist percentage was only 7% of total industry revenue. The rise in artist share comes primarily from live performances, which traditionally have circumvented the monopoly control of the major labels. As Techdirt notes, however, that is likely to decline going forward as the labels increasingly impose what are called "360 contracts" on artists -- which require them to pay the labels a percentage of revenue earned from live performances. I'll add that another important point is that most labels require artists to pay their own production costs, with the initial pay out of money to the artist and the record production costs constituting a debt the artist owes the label that the artist must pay off through sales of the album that come out of the artists share of the royalty. (It would be as if the publishing industry included the cost of publishing the book as part of the author's advance).
In short, the monopoly/cartel that is the music industry does a heck of a job squeezing revenue from artists. Which makes claims that they speak for artists in policy debates rather horribly laughable.
Citibank report: https://ir.citi.com/NhxmHW7xb0tkWiqOOG0NuPDM3pVGJpVzXMw7n+Zg4AfFFX+eFqDYNfND+0hUxxXA
Techdirt story: https://www.techdirt.com/articles/20180819/00051140461/only-12-music-revenue-goes-to-actual-artists.shtml
