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Now Is A Golden Age for New Artists: Be Encouraged (And Realistic) 

Why This Is a Golden Age for New Artists (So Long as They Keep Their Ambitions in Check) 

We’re seeing a clear commercial emboldening of “middle-tier”‘ musicians at the expense of megastars 

Guest Post By TIM INGHAM 

What Is happening to streaming’s superstars? That was the big question asked in this very column two months ago. The answer, delivered by a myriad of game-changing stats: they’re getting squeezed. 

New data now shows that this trend isn’t going away – and is, in fact, calcifying. Industry monitor Nielsen recently released its half-year U.S. music trade report, which revealed the total number of interactive audio streams played in the first six months of 2019. This figure stood at 333.5 billion – up 28% year-on-year.  

Within Nielsen’s report, the body also confirmed the artists who attracted the most on-demand audio streams in the States during this period. The top five for the first half of 2019: 

  • Drake (2.66 billion streams); 
  • Ariana Grande (2.59 billion); 
  • Post Malone (2.35 billion); 
  • Billie Eilish (2.23 billion); 
  • Juice WRLD (1.91 billion) 

Guess what? The cumulative amount of audio streams accumulated by these Top 5 artists (11.74 billion) was actually smaller than that racked up by the equivalent Top 5 acts from Nielsen’s H1 2018 report (11.83 billion). The top five for the first half of 2018: 

  • Drake (3.33 billion streams); 
  • Post Malone (3.15 billion); 
  • XXXTentacion (1.92 billion); 
  • Migos (1.90 billion) 
  • J.Cole (1.53 billion) 

It must now be beyond doubt: There is a very significant shift in the democratization of music industry revenues taking place, with the momentum swinging away from blockbuster megastars and towards a much larger “middle tier” of artists. A juicy takeaway stat: according to Nielsen’s midyear reports, Drake was the biggest audio streaming artist in the United States in both the first half 2019 and the first half 2018. But, from one year to the next, his streaming tally actually fell by approximately 670 million plays.  

This, remember, happened amid a macro streaming marketplace which continues to shoot up by a double-digit percentage every year. 

Stats like these fit neatly with what Spotify – the world’s biggest subscription audio streaming platform – calls, to this day, its “mission”: “[To] unlock the potential of human creativity by giving a million creative artists the opportunity to live off their art and billions of fans the opportunity to enjoy and be inspired by these creators.” 

We don’t yet know how many acts relevant to that “million creative artists” goal are “making a living off their art” but we do know this: According to MBW research, the three major labels jointly saw their streaming revenue growth shrink in the first half of this year; simultaneously, Spotify’s revenue growth grew faster than ever. 

The most likely conclusion, there: Spotify is increasingly paying more of its royalty money to acts outside the three major record companies. 

This trend – the clear commercial emboldening of a “middle-tier”‘ of artists at the expense of megastars – is, it transpires, also bleeding into the live music arena. 

One recent hard data point shows this fact very clearly. The biggest concert promoter in the world, Live Nation, saw its total concert revenues grow by 16% year-on-year in the first half of this year. The driver of this uptick? Ticket sales for shows by artists operating outside LN’s Top 100-grossing acts. 

This sub-100 club saw their concerts revenue grow by 32% in H1 2019, Live Nation revealed last month – double the size of the percentage increase across its entire business. 

“[We’re] seeing more artists than ever in the history of this business selling between 2,000 and 4,000 seats [per show] right now.” 

The rise of the “middle-tier” artist has definitely been noticed by the world’s other largest concert promoter, AEG Presents – the owner of Coachella, which also works on tours for huge artists such as Elton John, BlackPink and The Rolling Stones. 

Rick Mueller is President of AEG Presents in North America. “I don’t know whether to call it a golden age or a renaissance, but we’re seeing more artists than ever in the history of this business selling between 2,000 and 4,000 seats [per show] right now,” he tells me. “I’ve been in this business for 25 years and I’ve never seen anything like this. Artists are coming out of the club world into theater venues at an incredible rate.” 

Mueller is certainly well-versed on this subject. AEG owns theater venues including Los Angeles’ Shrine Auditorium – which he says is now hosting roughly 65 shows a year. Meanwhile, the city’s Hollywood Palladium, owned by Live Nation, is hosting closer to 100 shows a year. And over in New York, the recently-opened Brooklyn Steel – co-owned by AEG and Bowery Presents – laid on a whopping 220 shows in its first 12 months of operation. 

“These are astronomical numbers in major markets, but even in the smaller markets you’re seeing a significantly larger quantity of shows taking place,” says Mueller. “Bands just keep coming out of nowhere and filling these rooms.” 

AEG suspects that this trend is closely related to the “middle tier” streaming artist phenomenon, with services like Spotify, combined with social media, putting the ability to build significant audiences back into the hands of performers and their teams. 

“Rewind 20 years ago, for a band to get the scale and following they needed to [sell out] a 2,000 seater venue, securing radio airplay was critical,” says Mueller. “But the advent of social media, streaming and viral media in general has changed everything.” 

This is all excellent news for artists hoping to quit their day jobs. Industry insiders suggest that a typical U.S ticket price for a 3,000-capacity theater venue today sits at around $40, and that, depending on production values and other factors, an act can expect to take home a 65% margin from that pricetag. 

Playing ten sold-out theater shows like this across the States would therefore gross $1.2 million, from which 65% would see $780,000 retained by the artist in question. 

Willard Ahdritz, the founder of artist/songwriter services company Kobalt – and the originator of the “middle tier” epithet – estimates there are currently more performers than at any point in history making a living from their recorded music catalogs. Presumably the same goes for the touring market? 

“I think that’s a fair suggestion,” says Mueller. “Between what an artist can make on the shows themselves, then adding in merchandise sales, there’s a good living to be made at that 4,000-cap level.” 

So what’s the catch? Evidence suggests that, just like in streaming, as the earnings of the “middle tier” of artists explode in live music, so the relative success of global superstars may inevitably start to dwindle. 

According to Pollstar data, the volume of ticket sales to the world’s Top 100 tours fell 6.1% year-on-year in November-May 2018/2019 compared to the same period in 2017/2018. Revenue from those ticket sales also fell, down 3.8%. Meanwhile, there is a notable lack of new artists breaking into the ranks of mega-grossing touring artists: As Rolling Stone noted last week, the average age of an artist behind a Top 10 global tour is now a creaky 53. 

Mueller says that AEG is not blind to the difficulty of elevating artists beyond the ranks of those 2,000-4,000-cap venues and into 10,000-plus cap arenas or huge stadiums. “I won’t call that a problem, but it’s definitely a challenge,” he says. “There is just so much music out there now; how do you get scale and [consumer] focus to grow someone into a true superstar?” 

Mueller refutes the idea, however, that the age of the mainstream breakthrough icon may be grinding to a halt. He points to recent Rolling Stone cover star Billie Eilish, who he says has “shot right past club and theater level into an arena superstar within literally 18 months”. 

And then there’s Ed Sheeran. At 28 years old, Sheeran is now a conspicuously young face amongst the world’s biggest-grossing live artists. Earlier this month, the British singer/songwriter broke U2’s all time record for a world tour’s total gross, generating a startling $736 million on a Divide-themed trek which will eventually see him play a jaw-dropping 255 separate nights. AEG is one of a handful of concert promoters that Sheeran has worked with on this global jaunt. 

“What I find most impressive about Ed is that he built off his first [global] touring cycle to get even bigger second time around,” says Mueller. “That’s one of the most challenging things for artists today: after earning that early success, how do you sustain it and grow it?” 

He adds: “Ed Sheeran continually puts out monster hit records. At the end of the day, that ability to build and build your audience comes down to one question: did you keep on writing songs that resonate with people?” 

As some elements of the music industry rulebook get torn up in front of our eyes, it seems, other passages remain resolutely unchangeable. 

Tim Ingham is the founder and publisher of Music Business Worldwide, which has serviced the global industry with news, analysis and jobs since 2015. He writes a weekly column for “Rolling Stone.”

Seven Misconceptions You Might Have About Music Publishing 

Seven Misconceptions You Might Have About Music Publishing

Take it from me: music publishing is a vast and potentially confusing topic, even for those of us who work in the industry every day. There are reams of laws — many dating back decades or further — and seemingly arbitrary protocols depending on platform, territory and other factors. 

I'm not going to pretend that I can give you an overview of music publishing in one article, but I am going to try and clear up a few of the most persistent misconceptions about the topic in one fell swoop. 

Publishing royalties only matter if you sell thousands of units 

Understanding that your song is split into two halves (master recording and composition) and earns different types of royalties for each half is essential to determining exactly what revenue you're owed. More specifically, publishing royalties are attributed to the composition side of your song and are earned in various ways. Part of those publishing royalties come from mechanical royalties, which are generated from sales of physical copies (aka "units") like vinyl or CDs or digital downloads from streaming, but that’s not the only way you earn publishing royalties. Other ways you earn royalties from your composition include streaming services like Spotify, video platforms like YouTube, song lyric sites, live performances, apps and more. 

Mechanical royalties are only generated from physical sales 

The term “mechanical” dates back to the days when music playback only occurred through mechanical means, like cranking up the Victrola at a (low-volume) 1910-style house party. In the pre-streaming era, every sale of a physical product (like LPs, CDs, or cassettes) earned a mechanical royalty. Today, streaming has become the primary form of music consumption in many markets. Those streams also earn mechanical royalties, making physical sales account for only a small percentage of your mechanical royalty revenue stream. 

To own the copyright of a song, you have to mail it to yourself 

While there are circumstances in which you should consider filing a formal copyright application for a song you write, from the moment your song is considered finished, or “fixed in a tangible form which can be reproduced,” you own the copyright. This might take the form of lyrics and chords written down on paper or a simple demo recording. Once you write it and have some physical representation of it, you own the copyright on that song and therefore own the publishing rights to it as well. 

Collection societies will collect all of your publishing royalties 

If you are only signed up with a collection society, you’re missing out on a big piece of your publishing income. Affiliating yourself with a CMO (collective management organization) or PRO (performance rights organization) such as ASCAP or BMI, if you’re in North America, is an essential step in music publishing, but it’s more like the beginning than the end of the process. For many songwriters, the royalties collected by their collection society represent perhaps a third of their overall publishing royalties. None of the major US PROs collect any mechanical royalties, whether from physical sales or streaming services, which is a significant - and growing - piece of the publishing revenue puzzle. While US PROs may be collecting global performance revenue via reciprocal deals, they may not be covering all the markets where your music is being performed or consumed - and they are almost certainly not collecting your international mechanical royalties. If your home collection society is outside the US, they may be collecting your mechanicals already, but that doesn’t mean they are registering your song with other global performance and mechanical societies to ensure that you’re collecting in every territory. 

Songwriters don’t earn royalties from broadcast radio 

While songwriters are typically paid performance royalties for broadcast (AM/FM) radio play under a “blanket license” that pays less than, say, a direct sale, the royalties earned through radio can be significant. The US is an outlier, however, when it comes to paying royalties on radio broadcasts to the sound recording (master) copyright owner, which is usually the record label or the self-released artist. Joining a small minority of countries in the global music market that includes China, North Korea and Iran, the US does not mandate that master recording owners be paid this second type of performance royalty for broadcast radio. However, satellite and non-interactive streaming radio services like Pandora do pay out to both master owners and publishers. 

A Co-Publishing Deal Is a Quick Way to Break Into Music Publishing 

Not quite. In these deals, a songwriter assigns a portion of his or her publishing rights to another person or company in exchange for money; usually, an advance on any royalties the song(s) will earn in the future. While there’s nothing wrong with this arrangement per se, it demands a keen and clear-eyed focus on the future. Is your co-publisher well-connected and able to score you syncs, performances by popular artists and other placements? Even in the best of circumstances, a co-publishing deal is much like a high-interest loan advanced against future earnings. That’s one reason we advise you seek experienced legal counsel before entering into any publishing deal that involves you giving away any of your rights as a songwriter or publisher. This leads us neatly into our final, and perhaps most important point…. 

Songwriters Give Up Ownership of Their Copyright When Signing a Publishing Deal 

It depends on the deal! If you’re signing into a co-publishing deal, generally you are signing away ownership to current and future songs throughout the term of the agreement. If you want to keep your ownership or aren’t ready for a traditional publishing deal, a publishing administration deal might be a better fit.  When you sign up with a publishing administrator like Songtrust, you do not lose any ownership of your copyrights and are free to exploit your songs however you’d like, in any form you’d like. Plus, by having your songs registered properly worldwide, you set yourself up to collect all future publishing royalties. 

These are just a few of the misconceptions floating around about music publishing, and as creators become more independent, the landscape of music publishing will certainly change and more misconceptions will come to light. If you’ve decided to make songwriting your career, make sure to learn everything you can about the music industry and, most importantly, music publishing, to ensure that you’re making better-informed decisions about your work.

Have questions? Contact me at michael@mpickeringmusic.com It would be my pleasure to help!

CD Baby, Tunecore, DistroKid Add Rapid Apple Music For Artists Verification  

CD Baby, Tunecore, DistroKid Add Rapid Apple Music For Artists Verification 

Top 3 DIY music distributors CD Baby, Tunecore and DistroKid have all added rapid Apple Music For Artists verification, unlocking the platform's expanded analytics for their artists. 

To be eligible, artists must use the same email address and password that they use for their distribution account when signing up for Apple Music For Artists. 

Here's how CD Baby describes what Apple Music For Artists offers: 

When you claim your Apple Music for Artists profile you’ll be able to: 

  • Express your visual brand on the platform 
  • View the real-time results of your music promotion 
  • Ensure that your music catalog is accurately represented 

With Apple Music for Artists you can view: 

  • Plays from on-demand streaming 
  • Average Daily Listeners 
  • Song Purchases on iTunes 
  • Radio plays on Apple Music 
  • Shazams (yes, Shazams!) 
  • Insights and milestones for your music worldwide (for instance, “You passed 10,000 all-time plays in Canada”) 
  • Plays from Playlists 
  • Most Played Songs 
  • Popular Countries (with heat maps) 
  • Demographic and geographic information about your listeners (by song, album, playlist, etc.) 
  • And more

Apple Reportedly Ending iTunes 

Apple Reportedly Ending iTunes

The file organization system you've been finding ways to work around for over a decade is about to be no more. According to a report from Bloomberg, Apple is hoping to phase out iTunes in the near future. Apple CEO Tim Cook is expected to announce the decision to move away from iTunes as part of a push away from the iPhone in coming years. 

Guest Post By Alex Galbraith

Unveiled in 2001, iTunes originally functioned as a music library and marketplace for iPods, iPhones, and Mac computers. As the company shifts its focus to other arms, the iTunes library will be replaced by separate desktop apps: Music, Podcasts and TV. iPhones and iPads already separate out libraries in this manner. 

The company's Worldwide Developers Conference is a closely watched event for fanboys and journalists. At this year's iteration, the company is also expected to announce greater freedom for their Apple Watch, which currently only works if it is connected to an iPhone. 

While the company is looking to roll out a new iPod soon, the move away from iTunes is probably a savvy business move given the recent raft of bad press attached to the brand. The company is currently being sued by users who allege that their iTunes data was sold to third parties who connected the data to personal information to sell to marketers. 

“None of the information pertaining to the music you purchase on your iPhone stays on your iPhone," the $5 million lawsuit alleged, per Billboard. “The data Apple discloses includes the full names and home addresses of its customers, together with the genres and, in some cases, the specific titles of digitally-recorded music that its customers have purchased via the iTunes Store and then stored in their devices.”

It's An Indie World After All  

It's An Indie World After All 

If there was still any doubt in your mind that you didn't need to be signed to a major label in order to succeed in the music industry, wonder no longer, as new data reveals just how much of market share indies have gained in recent years. 

Guest post by Bobby Owsinski of Music 3.0 

If you thought that you needed to sign with a major record label or publisher in order to have success, that’s no longer true and there’s a lot of data to prove it. No metric is more valuable in seeing this picture as market share. Indies have made great strides in this area in recent years and continue to do so. Let’s take a look: 

Record Label

Physical Product

Digital Product

Physical/Digital 

Universal

23.4%

32.4%

29.8% 

Sony

19.2%

20.2%

19.9 %

Warner

13.4%

17.7%

16.5%

Independents

44.0%

29.7%

33.8% 

The big takeaway here is how well the indies stack up against the majors. When it comes to physical product, the indies are way ahead, and when it comes to total product they are as well. 

Something similar happens with publishing. 

Record Label

2017

2018

Change

Sony

27.3%

26.0%

-1.3% 

Universal Publishing

19.5%

20.2%

0.7 %

Warner Chappell

12.0%

12.3%

0.3 %

Independents

41.2%

41.4%

0.2 %

Once again, the indies are way ahead of the major publishers and its’ not even close. 

This goes to show that everything in the music industry has been turned on its head. A decade ago and for nearly 100 years, the major labels and publishers dominated the industry. Today indies have a major share of the industry, and while no single company is as strong as a major (yet), they are as a group. 

Artists and songwriters are leery of major corporations in general, and that’s who run the major labels and publishers. They know that the majors have shareholder interests in mind more than theirs. It’s also now a safer bet to sign with a indie, since success is no longer a long shot by going down that path. 

The data was compiled by the Music & Copyright Blog.