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White Collar Criminals

MONEY, MUSIC AND PIRACY

 Tuesday, October 19th, 2010 at 1:30pm by

The music industry is rapidly contracting; this much everyone knows. But by how much? And just how quickly are things deteriorating? Is it necessarily all gloom and doom across the board?

If you dork out on music industry stats like I do, then this recently released study by ClickItTicket.com is for you. They’ve compiled a giant scrolling graphic that shows a number of different metrics in easy-to-read chart form; recorded music sales, digital sales, live concert ticket sales, most downloaded iTunes songs of all time, how much (on average) each member of a band gets from a record sale, how the money is split up between distributor/label/band… these just are a few of the topics.

Anyone remotely interested in the future of the music biz — which should be all of you — should absolutely take a look. It’s fascinating.

-VN

  • Jon Miguel

    Fuck man seeing the top downloaded songs on itunes. Really depressing.

    • Alex_P

      No kidding, eh?

      Of course, I’m one to talk: I won’t pay for downloads because I prefer CDs vastly. Needless to say, not every album on my iPod is something I own a physical copy of.

      • Matt Hyde

        Digital only accounts for about 3% of metal sales. Compare that to the claim of overall, 70% of sales today being digital, the top downloaded on iTunes doesn’t surprise me at all.

  • http://www.facebook.com/people/Brandon-MXickman/502613553 Brandon MXickman

    depressing? good thing doom metal is in no danger, cuz i’m sure they don’t live off of record sales :p

  • Nick

    The interesting part of this is that music sales went up in 2004 and 2005 over 2003 well after downloading had become the norm. Looking at the cds sales in the past 3 years is absurd. The economy is shitty right now and sales for just about everything across the board are hurting due to the economy. Obviously 2008 is going to be really low due to the economy. As for concert sales looks like artists still don’t have any problem making good money playing a show. I don’t care if they only get a slight cut of the money. If you are getting paid a few 1000 for a few hours of a live show thats amazing money. I get paid about $26/hour and my company charges our clients $100/hour for my services. I don’t see how there is much difference in the music industry as in the rest of the world. Anyone that works for a company is getting paid a fraction of what they are making for the company, otherwise the company would never hire you. If the artist is getting ripped off why don’t they just do it all themselves? Reason being because they don’t want to or can’t afford it. Its not hard to record a cd now and just sell it online. Hell NIN gives their shit away for free nowadays. I still don’t see the big deal. So you don’t make as much money in being a musician. Maybe if the industry was not so watered down with crap people would care more about music. Also why is there no stats on merchandise here? I am sure alot of artists make a small fortune on merchandise. And one final thing as far as local artists go and people saying we are hurting the economy by downloading music. Since when does a local artist pay taxes on shirts and cds they sell or money they make playing concerts? Yeah I didn’t think so.

    • http://www.facebook.com/people/Christopher-Murrie/1391587458 Christopher Murrie

      “Since when does a local artist pay taxes on shirts and cds they sell or money they make playing concerts?”

      Income Tax? Granted, it is mostly cash changing hands at concerts so it easy to fudge, but income is income and subject to tax.

    • http://www.facebook.com/people/Kyle-Dolan/100000510289061 Kyle Dolan

      I think you are leaving out a few things when considering financial factors for musicians:
      1) It takes a lot of money and time to transport them from place to place. There are so many crew people involved to make a three hour show happen each night in a different city.
      2) Developing and writing songs takes a lot of time and therefore money on the part of the artists. Much like the successful retail items that started out as ideas, (facebook, iPod) they took a while to go through research and development. These processes happen in music as well. The artists quickly eat away at the “small fortune” they amassed while on tour when they are sitting around writing music for 6 months. (Not to mention the studio costs after the writing phase.)
      3) As for NIN, their initial label put a significant amount of money into launching their (Trent’s) career. They had to put him through the musical / promotional infrastructure. While I don’t think labels handle contractual issues well and never did, they should be recognized for launching him. No matter how good his music is or was, Trent never would have been launched without significant financial backing.

    • http://twitter.com/stuffuyouwillhate Sergeant D

      The “increase” in 2004/5 is so small that it is probably not statistically significant.

  • Cryzthormagnusian

    My only question is are the piracy numbers a bit skewed?

    In other words, is a Lady Gaga CD readily available in stores in places like Pakistan or China? They are using those regions as reasons why they are losing money, but if there was no revenue there to begin with you can’t use that number against the sales numbers as a loss. So 500K people downloading Poker Face is 500K people that would not have had access to it anyway,

    • http://www.facebook.com/people/Matthew-Shaw-Thomas/522440411 Matthew Shaw-Thomas

      That is a very good point…

    • http://www.facebook.com/people/Matt-Ayers/531466996 Matt Ayers

      I’ve wondered about this a lot before too. For instance, I listen to a lot of Japanese music, and I do try to support the bands I really like by buying their CDs. However, Japan famously have very steep media costs, so a CD with shipping can sometimes be around 40 dollars. Of course I don’t own a physical copy of all the music I have from Japan, but since the manufacturers and the band probably never accounted for much overseas revenue, am I costing them money by not buying their music all the time?

  • Erek

    I think the underlying problem with the music industry is the music industry. Remove the industry element from the equation and sales will probably pick back up. What do I mean?

    I mean they need to stop signing shitty bands, releasing shitty music, and pushing for quantity over quality. The same can be said about the film industry — how many horrible movies come out each year, tank, and lose money?

    If these industries losing money are what’s forcing them to stop choking us with bullshit, then I think that’s a good thing. Let’s clean up the fat. Let’s stop releasing compilation album after compilation album every motherfucking year — we already have the songs, assholes, we don’t need them again. That’s why we download music, we get the ONE NEW SONG at the ass end of the CD because we already have the rest and don’t feel like paying $19 plus tax for it. Fuck you.

    • Gecko

      Dude, right on! I’ve been saying the exact same thing for years. In any industry, oversaturation of the marketplace, especially with crap, leads to lower sales. The more sports leagues expand, the fewer dollars are available for each team. The more TV shows and channels, the fewer ad dollars to fight over. And with music, the more garbage CDs produced, the less likely people are to buy them. Either make them less expensive, sign fewer acts, or release fewer albums to offset everything. Dude, right on.

      • boob

        how many horrible movies come out each year, don’t tank, and make a shit ton of money? all it takes is a few to make it all better…

        the music that comes out sucks balls, but it sells… what do you expect them to do? take risks?

        • ALLOY_Matt

          Download the one song on iTunes! You probably stole the compilations anyway. What’s wrong with the METAL music industry is the shitty fans! Buy a damn album! They put out tons of shit because they have to try to recoup all the costs of you fuckheads stealing! Labels have to put out shitloads more content for less sales, they sign mad amounts of bands to create a cushion. So many people stole the new Whitechapel that now they have to sign 5 other bands that sound like them to try to get the few actual buyers to buy more. Quit your fucking “I’m a vagina and a whiner so I want free music” bullshit and buy the records you like! If you don’t like a band don’t buy it, but don’t pirate it either! Why do you have it if you don’t like it? Idiots. Grow a damn brain. One song on iTunes costs one dollar, if you want one song, it’s nice and cheap.

  • Fuckin Eh

    Nice comment Nick! Some awesome comments in there. Your right on merchandising, I have family who are pretty tight with one of the dudes from The Dropkick Murphys (not metal but I’m just making a point). As they are pretty big in the punk genre, things may be different for a smaller band, but what I’ve understood from things they have told me,stuff like merch at a concert are practically pure profit.

    • Matt

      If you do a small run of t-shirts (we’ll say 200) with three colors it averages about anywhere from $4-5/per shirt to get it printed on a shirt of good quality. You sell this shirt for $10 and most peoples consider it a “bargain” price and will buy it up if they like the band or even just the artwork. On a larger scale run obviously cost per shirt is much lower so I can vouch that merch is practically all profit.

      This is why I preach to support bands by buying merch. A big majority of bands in our genre don’t make shit off cd’s simply because they can’t move the volume as compared to a big pop act like Lady Gaga who sells in the millions. It seems these days most metal bands are lucky to be even able to sell in the thousands (unless we’re talking a mainstream act). I know some people still prefer physical formats but my 32gb ipod holds way more music in less space then a cd can. And lets be honest 90% of us don’t “buy” digital formats of music. Most of us are just as poor as the bands haha.

      That’s my understanding at least. Anyone in a national can correct me.

  • http://www.facebook.com/people/Eric-Manner/1347964651 Eric Manner

    Well…maybe this will force more bands to start touring more. This will also drop the price for producers.

  • ZackP

    Am I the only one who thinks that figure of 36% of Americans admit to pirating music is beyond low? I can’t remember the last time I heard someone say “Yeah, just bought the new _____ album from iTunes (or CD shop, for that matter)”. Knowing these bands don’t get shit I’d much rather throw them $10 in a tip jar when they come to town, knowing I helped feed them or put gas in a tank is way more satisfying than knowing I’m throwing a penny into the fountain of the record business.

    • Erik

      That number is beyond low. People must be scared that if they admit to illegal downloading, Gene Simmons is going to come take their house.

  • troe

    I remember having a bass teacher who was told me: “I don’t see the problem with pirating music as most bands make their money off touring.” While that’s certainly true, I’m the type of person who will buy everything a band has released even if it’s for one promo song. Maybe it’s being a performance major, but there’s something about owning physical copies and knowing that a lot of work was put to produce something. I too though, RARELY, buy digital downloads and very few of my albums are pirated (mostly demos).

    That being said, I love going to concerts and am a total merch-whore. All about supporting the music .

    • stevebazzano

      +1

      i have a ton of merch and cds, i don’t know where to store many of them anymore, haha.

      • boob

        I’m a stupid collector nut…. I will totally download anything knowing that many 10 copies of Tool’s Undertow (all from different regions) make up for it…

  • plusoneintellect

    been reading about this shit for a decade now.

    it’s always “if people didn’t pirate this music we would receive X amount” whereas it’s more along the lines of “if people didn’t pirate this music we might receive a portion of this money but some people just wouldn’t buy it in the first place”.
    they also never take into account that some people may buy the music after having downloaded it illegally, if they really like it.

    i mean it’s not like i support piracy really, but there’s nothing you can do about it now. people just need to move on and stop trying to sell CD’s for ridiculous amounts of money. the only reason record companies are pissed is because with the CD replacement cycle they were able to generate huge markups.
    now that people are buying less CDs they are left with the same huge overheads with less ways to make any money.

    as for any band that would be associated with this blog, they don’t need a record deal. what they need is a good manager, a booking agent, a publishing deal & the will to do things for themselves rather than relying on other people. some bands/artists are just lazy, fuck them.

    watch in the next few years as lazy bands fall by the wayside whilst proactive bands who really fucking care take over. it’s pretty obvious what bands need to do now to make money. as for anyone who actually cares about this shit, buy some books. there are loads of good ones out there on this very subject.

    • Jonathan

      Your first paragraph is exactly what I do. I liked All That Remains, before that woeful disgrace in 2008. But I bought it before I knew it was so terrible. Since then, I’ve downloaded what I consider might be worthy of purchase. Then, if it seems worth the 15$, I’ll pay. If not, I get rid of the download, because it’s a waste of limited digital space. Which is valuable these days, let me tell you…

      P.S. While ATR’s new album is better… it still sucks. Immensely.

  • Nick

    I am sure most people here don’t remember this, but when CDs first arrived on shelves they always claimed that CDs were so much cheaper to produce and that they would cost nearly half the price of a cassette. Well obviously that neve rhappened as cassettes as far as I can recall were between $8.99-$11.99 and CDS were never ever half that price. All that happened is that the record companies made more money off of a CD than a cassette and the price never ever dropped lower than a cassette price and actually went way higher over the years.

    • boob

      production is such a tiny portion anyways…. maybe they mean that it costs $2 to make a cassette, but only $1 to make a CD…. what they failed to mention was that it barely translates into any savings in the final cost….

  • RobotScythe

    The biggets problem the record labels are facing is they are still trying to use the old business model. The old dinosaurs are failing to adapt and are becoming exinct. This is just a period of transition, not the end of the music biz. Few artists and companies have yet to learn how to fully benefit from the digital age yet.

    • Alex_P

      People keep repeating this argument (see above), and that’s because it’s right. The recording industry is obsolete, even if labels aren’t completely. We need more Profound Lores, less Sony BMGs.

      • boob

        amen brotha (in a totally non-religious context)

  • Nick

    People have been making music from the beginning of time and plenty of people still make music for the fun of it. There is plenty of shit music going around that we could do without. Its not a bad thing at all if you ask me, it will make the people that are really dedicated and talented stick around and try their best to make it. It will make the garbage that has over run the music industry slowly vanish. Sure the really really popular stuff is usually industry made crap, but the good bands will rise and the shit will fall and we won’t be oversaturated with 100 of the same band trying to make the same exact cd not for the music, but because its the popular thing to do and the way you can make money. Its all about the money for the good majority of musicians and once the money is gone, those people will find another career to suck dry and the people that will be left are the ones that really care about making good music. Plus it will make more room for good music to strive. Its just like anything in nature, there is only a certain level that something can be sustained at, once you over populate you cause problems and the music industry is so overpopulated that the success is spread so thin now, time to clean house.

    • Erik

      I think the opposite will happen. Most talented people aren’t going to invest the time and energy in something with no future. What’s going to be left are wannabe’s and fanboys who truly love music in a dorky nerd sort of way, but lack in talent.

      It’s like people who get music clefs tattooed on themselves. They’re dorks who love music but suck at it.

      I don’t think any of the rock gods would have pursued or stuck with music if they realized they’d make more money flipping burgers. People were more realistic a few decades ago. They had common sense and knew that it takes money to survive in America.

      • Nick

        I disagree I think the best bands are the bands with cult followings. Thats bands that never hit it big with videos or huge album success, but they make great music and therefore succeed in live shows and merchandise. I think people that really love music will play it no matter what because they are not in it for the money but they are in it because of their passion and love for the music. There are plenty of examples of bands that never gained huge mainstream success but have been around for a long long time. Most of the really popular bands hit a huge peek of success and fade away and vanish after a few albums. Its bands like Sonic Youth, Dinosaur Jr. , THe Melvins etc, that have been around for so long yet never got that big MTV hit or Radio hit but yet managed to make a living because they are good and people will buy their stuff and go to their shows.

        • plusoneintellect

          Thankyou Nick that’s exactly the point. Those bands you listed are making a fine living for themselves. New bands need to look at what those bands are doing, and also a few others like the cure, and the best cult band ever – grateful dead, and copy some of their ways of doing things.

          As for the “people will turn away from music”. No they won’t.
          Some people may turn away from the music BUSINESS, but that doesn’t mean they won’t play instruments still and play in bands for fun. Part of being a PROFESSIONAL musician is throwing away your security in pursuit of your dreams.

          If you want to be in the music business now then it means you have to do more and more of the business things for yourself/band. But fuck it, it’s interesting (to a point) and it can be quite enjoyable setting up tours, getting your own artwork sorted, arranging printing etc.

          “so how hard is it for a band to release an album on their own? are the record labels really needed? i know shadows fall did something along those lines. cut out the middle man.”

          For the dude who said this: it isn’t hard at all. I could give you some links and you could go and do it now in any quantity up to 10,000 with a decent turnaround.
          Sure you need the money up front to do it, because that’s all a record company is, a bank.

          • boob

            actually, part of being a “professional musician” is doing the exact opposite… it is accepting that you will have to play stuff you don’t want, you will have to be competent in areas that you don’t care about, and accepting that, if you want this to be your job, you will have to make musical sacrifices…. and that is ok … throwing away your security is a very tiny part (if any) of the job…

            however, if you want to be in a “professional metal band” (whatever that really is) then that is a different set of circumstances…

  • Todd

    Something fun to watch whenever the labels start bitching about how their industry is dying:n

    http://www.youtube.com/watch?v=7Vz7Z42Fl9s&feature=player_embedded

  • Kuranes

    Why is the United States not on its own Priority Watchlist For Piracy? I don’t know any American teenager who has ever paid for ANY of the music they listen to (from my stepson’s pool of friends, some of whom could certainly afford it). But no, let’s put Canada on there… taking its toll on the US Economy. Please.

  • Chip Northcutt

    It’s confusing the way they are equating the entire revenue reduction to piracy. I don’t think it is so simple. As NIck said, bad product is hard to sell and gets harder as poeple wise up to the terrible system that sells terrible art as if it is the best the world has to offer in 2010. The live music numbers imply that the demand is pretty steady. One other possibility is that the ability to sample music before buying dissuades buyers from being sucked by good marketing to but bad music.

    Another related point: If I bought a record on vinyl and still own it, why do I owe again for a virtual copy of the same intellectual property I purchased and own? I don’t think that is piracy. RIAA is not to be trusted, thay exagerate everything to their favor as do most commercial advocacy groups. Its what they do.

  • Jared

    I would love to buy my albums but lets be real here, its just way to over priced ! With struggling to even feed myself, torrents are the best thing I’ve ever found. Not to mention a lot of stuff I listen to is not so easily found here anyway

  • Joe LaForm

    I love having a physical copy of an album. But you know as well as I do, “record stores” are few and far in between. And if you don’t live near a mom and pop shop, you’ll pay $25 for a new disc. That’s a lot of money, to a kid or a dad with a couple kids. As much as it’s our fault for downloading, it’s their fault as well for pushing for the digital media without safeguarding it. And for signing shitty artists.

  • WV

    so how hard is it for a band to release an album on their own? are the record labels really needed? i know shadows fall did something along those lines. cut out the middle man.

  • Sliv

    I don’t think getting rid of piracy is the solution, I do believe its part of the solution though. Less acts who don’t have so much as a comprehensive demo before they are signed, better production values, AND then cracking down on piracy might help. As a side note, has any one else noticed that the overwhelming desire to download music for free as opposed to purchasing it is born of some bullshit apathy my generation (the 15-18 as of 2010 crowd) and the younger ones have towards other people? I for one enjoy having a physical piece of art that I can enjoy and feel in my hands, and care a great deal for most of the artists who created it.

    • nick

      I still buy physical cd’s but really I have no attachment at all to them. It’s the music that matters ultimately. I’m not buying music for artwork.

      If downloading was as prevalent in the 90′s as it is today I would get music for free. I couldn’t afford to buy cd’s then. My parents could barely scrape the money together to pay for my weekly guitar lesson.

      With today’s economy things are even worse for more families. I’m not going to fault an excited teenager for participating in a culture who can’t afford to buy into it.

  • john

    another issue here is the fact that there are SO many bands putting out albums now. with such a large number of new bands, i feel like i owe it to myself to be very selective and not just blow tons of money on albums that i would throw away. the best way to do this is to download and take a listen, by that point you have the album sitting on your computer so the drive to go buy it is gone. there is just so much to chose from its not realistic for consumers to spend money to see if we like the product.

    • plusoneintellect

      Exactly. And if deathcore has been good for anything (which is debateable) then it’s for looking at how the new consumers react when they can download anything they want with tons of bands of a certain genre releasing material all the time.

      There are loads of blogs & metal torrent sites filled to the roof with free stuff. I mean granted deathcore is more or less dead now, but the guys I know and deal with in these kinds of bands will drop demos/EP’s, even whole albums, for free on the blogs.

      Why? because they don’t give a shit about any revenue from CD sales. To them their marketing is targeted towards t-shirts and touring. Anything they make from digital downloads/CD’s is just a bonus.

      An important thing to note is that it also costs barely anything nowadays to produce professional sounding recordings.
      We’ve got our own setup that cost under 10k, which will be viable for years to come. You can’t say that isn’t remarkable when you think of much you would have had to pay for studio time in the past.
      Do we pay for producers? No. We’re technology geeks who have studied enough about production to do our own. We do pay for mastering though, we won’t even have to pay for that once we get a few more pieces of gear in the future.

      As for how to sell music;
      Look at the way that solid state is marketing underoaths new album with the various price points, that should give you an idea of the way indie labels are moving.
      Bands should be doing exactly the same thing for themselves, just cutting out the record labels all together, because honestly, unless you are selling as much copy as underoath then you simply don’t need one.

      Sorry if my business rantings offend anyone, but I’m just trying to help any young bands who may be reading stuff about piracy and thinking “we’re fucked the ship is sinking!”, because it isn’t, some douchebags are just being tossed off the side.

  • nick

    These graphs are slick looking and all but I honestly don’t put too much faith in industry studies. If this was made by an independent entity, like a University or whatever, I’d be more inclined to believe the numbers.

    I’m still trying to understand that first graph. It says the numbers are in millions but why then use a comma? for ’08 are we to take that number as meaning only 8.48 million or 848 million? I would guess the latter but both numbers seem unrealistic. Is this total retail gross or record label net?

    As it’s presented we really don’t know and are forced to assume what these numbers really mean. This is just another useless industry propaganda tool.

  • nick

    I’d be more interested if some signed artist were to chime in with some real numbers. We all know most metal musicians are just scraping by and I’d be much more sympathetic to their struggle than GAGA’s.

  • boob

    wow… it’s a good thing that the US is the centre of the universe, otherwise… these stats might be totally useless…