Tuesday, June 15, 2010

Selling Music as a Loss Leader?

image :: 'how much do music artists make online?', informationisbeautiful.net
click on image to open full graphic in a new window

This graphic was posted by Wendy Fonarow earlier in the week and the numbers, sadly, don't surprise me at all. When I taught entertainment marketing {circa 2006-7}, I detailed the process by which artists got on iTunes and the implications for their wallets.

This comment makes a case I've seen made time and time again::
"These metrics are interesting, but they only tell part of the story really in terms of how a performing artists economics play out – Between appearance/performance fees, merchandising rights, and the always difficult to quantify perks, and the the extensive cost of recording incurred by performing or recording artists and the label offered finance arrangements (that make loan sharks ashamed to be in the same industry) – It’s still difficult to get a realistic picture of what it takes to survive as a musician. While it’s slightly less ambiguous as to what it takes to survive as a writer, it’s still not exactly a clear picture.  
Among the more interesting numbers in the metrics are things like the difference between price to the consumer, and total artist/label revenue via different distribution channels."
The comments in general are worth reading and many are critical of the graphic, but I feel despite the graphic's generalities, one thing is clear—the long tail is not a panacea and the devil's in the details.

While music can be seen as a "loss-leader", perhaps a better way to think of being a musician is looking at all of the possible streams of revenues with the actual music as a core offering. The larger the audience and the greater the exposure, the more likely the revenue streams will allow for viability. Social media can level the playing field, but that requires time, effort, and commitment to it—which for indie artists who do most of their own marketing, takes time away from the music.

Song:: Modest Mouse-'Bankrupt on Selling'

Twitterversion:: [blog] Infographic on how much music artists make off of the sale of music. Bigger picture is how music is a loss-leader. @Prof_K

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