Making money as a musician has never been easy, but now it can feel like the gap between expectations and reality is wider than ever. While top musicians seem to constantly flaunt their wealth the nature of their business is more lopsided than ever. This can be clearly seen in the results of a new report that reveals how musicians wind up with a small slice of every dollar spent on their music.
Stepping back for a moment, it’s worth mentioning that the report from Citigroup has both good and bad news for anyone who wants to earn a living as a musician. The good news is that the US music market is absolutely booming. Citigroup found that US music fans spent over $43,000,000,000 on music. That spending comes from a diverse source of revenue streams such as digital downloads, physical albums, performances, and more. So while just a few years ago people were predicting the death of the music industry it is clear that reports of its demise were incredibly premature.
The downside of the story, for musicians, is that while the industry as a whole made over $43 billion artists themselves got just $5 billion. This means that the people who make the music are only walking away with about 12% of the wealth that their art has created. It’s a striking disparity that has shocked many music fans. But those with an up-close understanding of the industry know that this sort of split isn’t anything new.
It’s tempting to that businesses are cheating hard working artists out of their hard earned money. But the reality of the situation is more complicated. It takes a lot of talented individuals to help support artists, doing the work that needs to be done to produce, distribute, and support the music that artists create.
It helps to compare the music industry to the food industry. Musicians are like chefs, their products are the reason that both industries exist, but that doesn’t mean that they’re the only people who matter. If a chef wants their food to reach as many people as possible they need to share their earnings with waiters who communicate with guests, advertisers who get word about the restaurant out to the masses, and managers who can steer the ship while the chef cooks. The music industry has similar divisions of labor that might mean that musicians take home a smaller share of the pie, but at the same time the pie is bigger because every job is being handled by experienced professionals.
Musicians who want to earn as much money as possible are welcome to act as their own agents, producers, and marketers. The internet has actually allowed a wide range of artists to find independent success in this manner. But most musicians get into music to perform, not to get lost in the minutiae of running a business. So
One thing that is overlooked in many stories about the report is the fact that musicians are actually earning a larger slice of the overall industry pie then they were just a few years ago. Everything needs to be looked at in proper context, and in this case, it’s important to note that in the year 2000 musicians were earning just 7% of the money their music generated. Musicians today are taking home pay that’s 171% of what it was 18 years ago.
While many headlines written about this report sound apocalyptic the truth is more mundane. The main thing people are learning is that the music industry is first and foremost a business. When businesses get big, the profits get split up and spread in countless directions. If you want to maximize the money that goes to artists, then you should try and support independent artists and give them money as directly as possible. The internet has opened up plenty of avenues for fans and artists to engage in these sort of exchanges, which is why artists today are actually in a better place than they were just a few years ago.