Mamma mia!
As we have written several times, the music industry and the world of music are the laboratory of the next cultural industry pushed furiously, also by the pandemic, into the Martian territory of cyberspace. And it is, truly, Doctor Jekyll's laboratory, the place where a real mutation of every known form takes place.
For example, for the first time in the history of the capitalist mode of production, a staggering growth in consumption and supply does not produce a proportional growth in business, on the contrary there is an impoverishment of the players who take part in this phenomenon.
Let us return in this regard to the studies of Erik Brynjolfsson and his collaborators at MIT's Sloan School of Management.
Today things seem to be improving thanks to new processes that are affecting the music market and its industry. One of these is precisely the DIY (do-it-yourself) of artists which has led to the flowering of new and revolutionary scenarios. An almost obligatory response to a sort of proletarianization of the artists who crowd the market platform swept by the pandemic storm.
Will Page, former chief economist of Spotify and author of the book Tarzan Economics which should be released in April 2021. Here are his reflections.
Explosion of artists
In 1984, 6.000 music albums were released in the UK. Today, streaming services make a similar volume — 55.000 new songs — available every single day.
There is not only more music, but there are also more musicians. Since the launch of Spotify in 2009, the number of UK songwriters has risen to 140.000, a 115 per cent increase, while that of artists releasing songs has risen by a staggering 145 per cent. Twenty years ago there were five major British labels and at most two dozen independent distributors; today Spotify hosts music from 751 providers.
Unsurprisingly, there are also many more genres to classify pieces of music. In 2000, the industry classified all of the world's music into no more than a dozen and a half genres. Today, Spotify's acoustic map “everynoise” features 5.224 genres, including Coptic hymns, Russian romance and, of course, the new lockdown hit, the shanty.
New content avalanche
Music was one of the first industries disrupted by cyberspace. His journey shows us what the entire cultural industry is doing and will do. The moon landing in cyberspace removes all barriers to entry and anything and everything happens.
Last year released a flood of new content (more than 3 million books, though only a fifth were new titles), nearly a million podcasts (885.000 new episodes — nearly two new podcasts every minute), a huge number of mobile games (88.000, up 50 percent from 2019) and original TV series (493 in the US alone, more than one a day).
Right now, investors' resources are pouring into new media. Over the past two years, there have been seven acquisitions of podcasting companies for more than $100 million each.
Proletarianization of the artist
However, all this has not translated into more resources for creatives. Perhaps they are the ones who lose the most from this ambaradan. And it's also why the established music industry is actually making good money off streaming.
However, there are still many mouths to feed. Many artists have not been able to buy tickets to ride the streaming bullet train. There are contingent and compartmentalized seats like in Snowpiercer.
A parliamentary inquiry committee in the UK has highlighted this dichotomy. Politicians were showered with angry testimony about music industry trends. Mercury Prize nominee Nadine Shah told MPs: 'I'm being hailed by the critics, but I'm not making enough from streaming to pay the rent… I'm just not being paid fairly for my work.'
Singer-songwriter Fiona Bevan, who has penned hits for Lewis Capaldi and One Direction, went further, arguing: "Right now, hit songwriters are working on Uber to make ends meet."
Welcome back class struggle
The top three music labels, which make more than $1 million an hour from streaming revenues, defended the current model, in which most artists receive a 20–25 percent royalty on stream streams. Since earnings go first to repay any advances, this means that an artist who receives a €100.000 advance must sell €500.000 of music before receiving any fresh cash.
Therein lies the conflict. When a music label has shelled out a hefty advance for a star, she's forced to invest more in the promotion and publicity needed to turn songs into hits. For lesser-known artists, however, it's practical to shell out small advances and simply wait to see if any of them go viral. It's a bit like the mechanism of finance: if you owe the bank 100.000 euros, you have a problem, if you owe them 1 million, the problem is theirs.
We just have to DIY (do-it-yourself)
The artists' response to this state of affairs is "it's done by yourself". Rather than signing a 30-page record deal, which sometimes requires an expensive lawyer to negotiate some points, many musicians are turning to DIY services like Distrokid and Emu-Bands. Their offer is built around three simple points: you pay a fixed fee, you keep all your rights and you keep all income.
DIY has caught on. Here he is if he took it. In 2020, major labels released 1,2 million songs; the “do-it-yourself artists” have published as many as 9,5 million. It's an 8 to 1 ratio between artists doing it themselves and labels doing it for them.
Streaming levels opportunities
Even if artists who choose to go it alone don't have the capacity to develop the same kind of promotional investment as labels, streaming tends to even out the differences. Within streaming, DIY artists can increasingly tap into many of the same data and dissemination tools as the big labels.
Using reporting from YouTube, SoundCloud and Spotify, artists can access analytics that show who their fans are and where they are.
Platoon, purchased in 2018 by Apple, allows artists to keep their rights and have access to customized global services. The Amazon-owned live video streaming platform Twitch had trillion minutes watched in 2020, with music now playing a prominent role on Twitch.
Patreon, a platform that allows artists to join and receive subscription payouts, is now distributing $2 billion to creatives. It took the global music industry 12 years to come up with the same thing with streaming revenue. These tools are available to everyone, and more and more independent artists are making use of them.
The disappearance of live concerts
For many artists around the world, these tools are their best hope for survival. The pandemic has wiped out live performance, which used to be the main livelihood for most artists. (In the UK alone consumers spent £2,5bn on live music in 2019).
As the UK considers whether to update music copyright rules, all other countries should look to this industry as living proof of what happens when barriers to entry fall.
The loaf is certainly growing, but the number of creatives wanting a slice is growing even faster. Well, let them eat brioche then.
Source: Will Page, Music makes more money but has more mouths to feed, in “The Financial Times”, 20-21 February 2021
