Why Music Sales Don’t Mean Much In The Web EraA kid emailed me the other day. He expressed to me how unfair he felt it was that the Rihannas of the world get to be big stars, but the armies of far more talented music artists and performers like himself can’t get the attention of the gatekeepers at the labels. He then asked me how I could help him.
I wrote back and advised him to forget about the major labels and instead to focus on developing his personal brand through his own website, online social media networks and live performances in any way, shape or form. I desperately wanted to get across the point that there are no shortcuts to success. There is no magic elixir.
I have no idea what this kid’s talent level or individual circumstances are, but I do know that there are thousands out there like him who are still enamored with the idea of “big music”. If every single one of these people asked me to advise them, I would tell them exactly what I told this kid. Don’t touch big music. It’s lost its relevance. It’s nearly impossible to get into the traditional music industry for most people today. Plus, it’s not lucrative anymore for anyone, but a tiny minority.
The problem that many music artists have is that they suffer from a vicious form of myopia that makes only the record label part of the music industry visible and important. I don’t fully blame these people either because that’s pretty much what we’ve all become accustomed to over the last few decades.
There’s really nothing wrong with the music industry. It just turns out that the record labels are now the least important part of it. We just think the industry’s dead because they are no longer at the center. The industry’s actually doing OK if you look at it from the standpoint of the bands, Apple, the fans, music streaming services, P2P file sharing, tour promoters, etc. We just need about 10 years to figure out how all of these pieces of the puzzle will fit together to render the industry as profitable as it was before. The industry, and media in general, is to a large degree still defined as those who own the presses; those who own distribution. We’re slowly being weaned off of that concept.
Take a look at this graph.
It shows that on Rhapsody, the top rated songs available at physical retailers are still getting the most monthly plays. But it also shows that there’s hundreds of thousands of songs by bands few people know about that are getting between zero and one thousand plays a month. This may not sound like much, but ask yourself where these bands would have gotten exposure ten years ago.
Two economists released a study last year called “Should You Invest in the Long Tail?”, which showed that 80% of revenue in online music sales came from about 52,000 tracks—the hits that power the music industry. When you break that down by album, only 173,000 of the 1.23 million albums available were ever purchased, leaving 85% without a single copy sold.
Many people have taken this to mean that the Internet hasn’t delivered on the dream of truly democratizing music. If the same small group of top artists are still getting most of the attention online, what hope is there for indie music—effectively everyone else out there?
I think that the study misses a major point. Music success isn’t neatly defined by music sales anymore. Just because you haven’t sold copies on Rhapsody doesn’t mean you’re a failure. The CD era trained us to believe that you were a success only if you sold copies.
But copies don’t tell the full story. What about a band who’s music gets downloaded thousands of times for free on a P2P site? Or one that get thousands of views from a small group of die hard fans on YouTube? What if that band monetizes the attention by getting people to their live show or gets people to buy an affiliated product? Even if it’s just a few hundred people. What if it generates enough revenue to support the band? Why should the definition of success be traveling around in a Lear Jet? Isn’t being able to support oneself off of something one loves to do success too?
The whole music sales mentality is too narrow a metric of success for the new music era for the simple reason that music sales are no longer the main driver of success in the music business. Digital copies of anything carry little value because they can be copied and therefore can’t be made scarce.
Selling copies is a losing game. Big music is still wedded to that idea and I wouldn’t advise anyone to yearn to be a part of that.
November 17th, 2009 at 11:08 am
Are you a professional journalist? You write very well.
November 17th, 2009 at 5:19 pm
Yep. My music is free and so are some of my guitar lessons. I make money with my membership site, guitar lesson courses, related affiliate products and some Google adsense from my YouTube videos. Never a better time!
November 19th, 2009 at 2:52 pm
Will, if no one was interested in music you would not be able to charge for those guitar lesson. I dont fully agree with you on this one Mika, You can make money in other innovative ways but never lie to youself that they dont matter because Music sales do matter to think they dont is to conclude that the all industry can run on live performances alone just like man cant live on bread or water alone same with msuic its need a mixture of all this things wether you like it or not. Theres so many aspects to the industry and some rely on sales an exampled dance music and so many others; your next door neighbour who lost their job after the Music shop they worked in closed down. Music Teachers who the reason why kids are in their lessons because they want to learn to play one of those top rated songs they heard. Its a complex business and its not that straight forward but i guess i can see why you cant see the bigger picture when it doesnt affect you directly yet.
November 19th, 2009 at 5:13 pm
Jay, I get your point. However, there’s a difference between how the world ought to be and how the world is. Many people would love to go back to the world platinum record sales, but those days are gone forever. That era was an anomaly. Record labels were able to artificially jack up the price of music by keeping it scarce on plastic CDs. But digital technology came along that destroyed that scarcity and music is available for free everywhere now. There’s no going back. Besides, the only people making money under that system were the record labels. Artists got screwed. Spending on live niche music is at an all time high. That’s great for the indie scene.
November 23rd, 2009 at 6:12 pm
I agree with Mika. In my experience, its better to just give away or sell your music digitally. There is no reason to buy CDs anymore. We make more off of digital sales, merch, and live performances than off of cd sales. I mean why buy an entire CD when you can just get the tracks you like for a far cheaper price (or free with P2P?) I would rather have my tracks passed around free, and have fans purchase merch and come out to shows, than have the majority of revenue go to the record label vultures. If you do your research, develop your brand, and promote smartly, the skys the limit for the indie artist today. Resistance is futile, and sticking to the old ways will kill your brand.
November 25th, 2009 at 9:33 am
In my opinion yes music is better now and more groups or artists are heard from, but it let’s in a lot of crap too that’s just not music. It’s all just propaganda for more crap i.e.: Soldier Boi etc etc…
When are the new artists going wake up and be yourself. Here is a link to prove my point.
http://www.youtube.com/watch?v=XFTYq3Z1P6w&feature=related
November 25th, 2009 at 8:40 pm
As someone that set up a indi label only 6 months ago, did all the behind the scenes work, and launched it 3 months later, i have to say that im loving this journey of discovery, meeting new friends, promoting great (and i mean REALLY GREAT) artists, learning about the industry, and yes we are selling music, getting high in those download charts….will i ever become a millionaire from it ???..sure why not, if i don’t then so be it, i don’t care, im in this becuase i love doing what im doing, i have a deep respect for my artists, i like to make them feel good about themselves and thier music, there’s only one thing that stops anyone from becoming a success in this world and that is the limits they put on themselves.
If you aim high, if you really LOVE doing what your doing, you’ll find a way af making a success of what you do…if i can earn a living from my label i’ll be a happy man, if my artists can make a living out of making music, and performing it then i’m a happy man, if i don’t im still a happy man, bacuse running a label (all be it a small indi label), makes me happy…and so i can’t go wrong !!
Jay
November 25th, 2009 at 9:54 pm
Well said, Jay. The whole “Get Rich Quick” mentality is largely to blame for lots of the synthetic crap that was pushed down the throats of consumers over the last 15 years or so. The complete breakdown of the record(not the music industry) industry is a boon to quality music.
February 14th, 2010 at 12:17 am
Do you make money out of this blog? just curious
February 14th, 2010 at 12:51 pm
I don’t. It’s purely about sharing ideas.