- Advertising in adverts (Magazines, Flyers, Posters)
- Advertising on television adverts
- Advertising on social networking sites (Facebook, Twitter, YouTube)
Music industry revenue streams
- Radio advertising revenue
- Live music sector
- Music retail sector
- Licensing of music to third parties
95% of music downloads are unauthorised.
71% of users increasing their illicit downloads cite high prices as the reasons.
84% of illicit downloaders think artists deserve to be paid.
SOLUTION: Lower song price & raise artist compensation transparency
What is the effect of piracy?
- The music industry is still losing out to internet pirates on a huge scale, with an estimated 95% of music available online being downloaded illegally.
- The industry is "transforming its business models, turning to marketing ideas such as Radiohead's "pay what you like" album in Rainbows and Coldplay's move to give away tracks to promote their album.
- In the UK market alone, the record industry lost £180m last year, and will lose more than £1bn by the end of 2013.
"It's a trend...about a new democracy of ideas and information, about the releasing of individual creativity"
Alan Rusbridger, Editor-in-chief of The Guardian
Beyonce - Illegal Album Downloads Cost Beyonce $3.8 Million In Sales Revenue
On the 13th of December Beyonce decided to surprise her fans buy selling a secret project on iTunes, that had no prior announcement or marketing by her record company.
By Beyonce's fans deciding not to legally buy her 14 new songs and 17 music videos for $15.99 (£10.70) it meant Beyonce lost out on money she would have made.
Independent swim upstream
As streaming services increase their share of the overall market, their royalty payments have come under scrutiny from artists and record labels.
Spotify said it paid out about $500 million in royalties in 2013, according to numbers it released in December. The company likes to focus on that big number instead of how it breaks down: 6 to 84 cents every time a song is played. It doesn't pay a set amount per stream, but uses a more complicated formula based on what percentage of spotify's total monthly streams an artist represents.
The company cites an example of a "global hit album" earning $425,000 in a month, but that's for a top seller. A mid-level artist could do tens of thousands of streams in a month and maybe see a few hundred bucks for it. Mulligan's report notes that some independent artists do crack that 1%, but it's not easy.
No danger for major labels
The numbers tell different stories here: the rise of streaming and increase in total artist income sound like music to musicians' ears. But if they're not in the 1%, they may be singing the blues the next time they open their royalty checks.
On the other hand, the major labels, Universal Music Group, Sony and Warner Music Group, don't appear to be in danger of losing their market share as downloads decrease and more users turn to streaming.
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