Music and the Digital Movement

Not so long ago, a career in the music industry was considered one of the most lucrative for an artist to pursue.  And while profits have been on the decline for major labels, it remains an area within entertainment where an artist can still earn quite a decent living.  For many years, there has been an ongoing discussion around how much of an artist’s income is generated through cd or album sales and whether digital sales would be a threat.  It’s a fairly known fact that cd sales do not account for a significant amount of income for an artist and it appears that online sales are even worse.

Source:  www.musicroom.com

In fact, according to a recent article in The Huffington Post, some of the popular artists in the industry made over $50 million in 2011, which is great.  But when we examine how much of that actually comes from online sales, it does not account for a large amount of income for the artist.  With so many different mediums for consumers to choose from, it seems that most artists are not feeling much love from online sales, particularly music streaming services like Spotify and Rhapsody where the artist profit is less that $.10 per stream in contrast to iTunes where the artist gets just under $7.00 per album download.  Based on these numbers it appears that the digital age can be both a gift and a curse in the artists’ world. 

On one hand, social media and the digital connections allow an artist to connect to their fans in a way like never before.  It allows them to create a community and build a relationship with their fan base that will ultimately translate into sold out concerts and a large number of digital downloads and streams.  Conversely, due to unapproved music track leaks and the lack of profit for artists the digital world can also create challenges for the artist in their pursuit of success and financial profitability.  So what’s an artist to do?

First, accept that the days of large advances and monster record sales are likely a thing of the past and recognize what the digital movement has to offer and work within it to create success.  As reported in another article in The Huffington Post, if artists can work with their management and promotion teams to develop a solid brand and utilize their music as a foundation for touring and other business ventures, this approach can be very profitable.  This is not to say the music takes a back seat, because that is at the core of developing the fan base, selling out concerts and influencing fans to purchase merchandise as well.  Whether we like it or not, this is the formula today’s artist may need to follow when building a successful and lucrative career. 

These are just my thoughts and I would love to hear yours.  Is it fair to ask artists to become a brand and engage in endorsement deals and the like, just to make a living as an artist?

Let me know what you’re thinking.  Until then, do you and creatively mind your business.