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The Top 1% of Artists Earn 77% of Recorded Music Income, Study Finds…

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Whatever money is left in recordings, you’re probably not making it.  That’s the harsh conclusion offered by Mark Mulligan of MIDiA Consulting, whose data shows a more extreme imbalance towards superstar artists than previously thought.  “The music industry is a ‘superstar economy,’ that is to say a very small share of the total artists and works account for a disproportionately large share of all revenues,” Mulligan noted.

“This is not a Pareto’s Law type 80/20 distribution but something much more dramatic: the top 1% account for 77% of all artist recorded music income.”

In other words, the exact opposite of the Long Tail, a theory that seemed exciting at the time but has now been thoroughly disproven (MIDiA’s report is titled The Death of the Long Tail: The Superstar Music Economy).  Because instead of embracing choice, consumers have actually been completely overloaded by it.  The result, according to Mulligan, is a ‘tyranny of choice‘ that makes consumers less likely to explore, and more likely to glom around mainstream artists.

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There is good news, however: although recorded music earns far less in 2014, the percentage earned by artists has increased.  Specifically, artists are now capturing 17 percent of recorded revenues, up from 13 percent in 2000.  The only problem is that these gains are only being enjoyed by a tiny minority of artists.

 

Summary report here.  Written while listening to Rick Ross’ latest release, Mastermind (Deluxe Explicit Version), on Rdio.  

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Comments (34)
  1. David

    I haven’t read the report, and I can’t even find out how to get it. (Some info on this would have been useful!)

    But having had ‘issues’ with some of Mark Mulligan’s previous figures, I am cautious about these new ones. Where on earth would he get the data?


    Reply
    1. Paul Resnikoff

      Here’s the summary. I’ll link it above as well.


      Reply
      1. Tom

        I think we should pay the entitled mediocre bands as much money as the bands that are awesome and I actually enjoy from time to time. Makes sense to me. Oh and kill the whales.


        Reply
    2. Mark Mulligan

      David – the research is based on anonymised data and insight from record labels (majors and indies), distributors, digital music services (big ones) and artist managers. The research took more than 2 months to do and went through numerous external validation stages to ensure the data is robust.


      Reply
    3. JTVDigital

      I can confirm that in a major record label, the top 10 artists account for more than 80% of the revenue.


      Reply
      1. FarePlay

        It is only going to tighten up and get much worse, for extremely talented mid-level bands. Save the whales.


        Reply
    4. Brian

      Soundscan…


      Reply
  2. lroosemusic

    Someone call Obama!


    Reply
  3. john

    lots of music out there that is listened to by no one…


    Reply
    1. Tom

      “””I got a new age girl. Tell us what’s she like. She has a crystal necklace… Can she ride a bike? “”

      Remember that song? Yeah, that is why the pie chart looks like that.


      Reply
      1. A man

        Love that song! One hit wonders Deadeye Dick!


        Reply
  4. Anonymous

    The top 1% get the radio plays, the press coverage, the big box retail space, the prominent places on the iTunes store, the massive promotional campaigns, the nationally televised music awards… practically everything. The top 1% is shoved down everyone’s throats on a daily basis. Does this really surprise anyone?


    Reply
  5. Jeff R.

    I guess as an industry we’re doing better than the income inequality here in the US. That is, top 1% making about 95% of total income. Not something to be particularly proud of still.


    Reply
      1. Jeff R.

        Whoops. I did read incorrectly. 1% controls about 45% of the WEALTH (not income), and the next 4% controls about 30% more. So I guess that puts us right in the mix. Thanks for the fact check!


        Reply
  6. Anonymous

    I know for a fact if you are a top artist or songwriter, you basically become set for life after PRODUCING ONE SONG. I know of at least one songwriter out there still making $300k+ in royalties each year from literally writing one song from the 80s.


    Reply
    1. TuneHunter

      I call it proper set-up!

      There is nothing wrong with it – come up with that song – a get paid for millions if not billions
      of pleasant, if it is really good, near orgasmic moments.

      Current set-up promotes “fake superstar” marmalade.


      Reply
      1. TuneHunter

        The set up of THE WRECKING BALLS.


        Reply
  7. Rocket Scientist

    Bombshell. Most music sucks. How new and different from the sixties, seventies, eighties, nineties etc, etc. Get a frikkin day job guys and gals.


    Reply
    1. SideburnsVanBuren

      Not sure what your third sentence means since it’s not really a sentence. But either way, your world must be pretty cold and dark, man. There’s so much more beautiful music out there today than there ever was. Sure there’s lots of crap, but if you don’t find a ton of stuff out there that you enjoy you’re not looking hard enough.


      Reply
      1. Tom

        Yeah, but most of the bands today don’t actually write their own songs. And they have zero input into their creation, and think about this, because honestly if someone gave you $$$$$ 50K to make a record, you would just take the money and run and fuck the music industry altogether (because you ain’t the fricken beatles right? Or zep? So why bother??!??), and take the money to pay off your student loans from film college and just continue working as a DJ at local dive bars around town for karaoke tips. You will probably have a better chance at success that way. Hard work. Crap jobs. And save your money.


        Reply
  8. hippydog

    Quote “This counter intuitive trend is driven by two key factors: a) smaller amount of ‘front end’ display for digital services – especially on mobile devices – and b) by consumers being overwhelmed by a Tyranny of Choice in which excessive choice actual hinders discovery.”

    I’m sure the ‘noise level’ (IE: too many choices) has created a bit of a problem for consumers,
    but I truly believe its the much smaller part of the problem..

    The predominate factor is the lack of an ALTERNATE source of curation and discovery..

    Lets go back a short time and compare..
    in the 40’s to the 60’s, yes, radio was a very large part of it.. but so was dance halls, and even the local soda shop..
    New bands and styles of music were being constantly discovered..
    Why, cause local DJ’s and dance halls were doing the curation, based on what the local kids were getting excited about..
    The IMPORTANT part was that discovery was local, and then spread outwards..

    Then in the 70’s to 90’s Radio become, and WAS the CURATOR of music..
    the problem was, more and more of the curation became controlled by a smaller group of people.. and everything was set up in a feedback circle who’s primary goal was to sell round disks..

    Then the digital era of the 21′ century happened and that heavily controlled cycle was broken..
    but instead of going back to the way things were, things tightened up even more trying to keep things the same..
    IE: Where are the local dance halls promoting the new bands?, Where are the local DJ’s playing new bands?

    Think about it..
    We know its the early adopters that drive the choices for the rest..
    Whats broken is those innovators and early adopters are NOT ABLE TO SHARE THEIR CHOICES WITH THE REST..

    You can not have curation when the general public isnt listening.. And right now Radio is the only thing driving the choices..
    when an alternate form of curation happens, we will see the long tail get a much higher share (then now)


    Reply
  9. R.P.

    this is awesome news! before it was the top 1 percent made nearly 90%. :)


    Reply
  10. Tony Brooke

    Having read the whole source report, I’m skeptical of some of the conclusions.

    Comparing anything in the music business to 2000 is immediately suspect, since 2000 was the absolute peak. So that is a data selection bias. Comparing 2013 to the overall market in 1950, 1960, 1970 or 1980 would be VERY different. I’d like to see stats on how the 1% fared then. I’d also be curious to see stats comparing the relative growths of percentiles.

    If the fundamental argument is that most of the public never sees the tail because of the “Tyranny of Choice” then how can the tail be interfering with their discovery? How is it even possible that “There is so much choice that there is effectively no choice at all”? That logic doesn’t work for me. Just how is it an “inconvenience” (as stated in the conclusion) to consumers to have more choice?

    The author’s argument is that the tail is growing faster than the public’s ability to digest it, but I just don’t see the problem with that. And the argument that algorithms need to get better to handle more data is weak. Algorithms LIKE more data to work with, it makes them stronger. I’d like to see proof that the user experience is diminished by excessive choice.

    Calling the tail “excessive pollution of digital music catalogues with filler drivel,” “cynical derivative sound-alikes” and “vanity releases from wannabe artists” shows the author’s allegiance to the mainstream and a predisposition to gatekeepers, despite the cover story of being anti-the 1%.

    OK, so the author hates Karaoke. Sure, we all do. If poorly marked tracks are causing user confusion, that’s another matter. So label them with better descriptive metadata. Done.

    The charts make for nice viral marketing but the report doesn’t convince me. Sorry for that opinion but it’s just my interpretation. Hope I wasn’t inflammatory. I just hope the democratization of music continues and the users can dig as deep as they wish.


    Reply
    1. Yep

      What’s wrong with Karaoke ? Soundalikes have been around since the 1960’s, nothing has changed there. Obviously, if there is confusion about what a product it, that should be fixed. Last time I looked at a ‘Karaoke’ product on Spotify or iTunes is was pretty obvious that is was a karaoke version.

      The labels, distributors and stores are pretty strict with metadata on these types of products. These days if it’s not VERY clear that the track is a karaoke version, it does not get in. The numbers that these ‘Karaoke’ products get is very high, way beyond what you would attribute to ‘confusion clicks’

      So this is retail, sales count, no matter what the music is – some people might not like the music but if it sells it should be on sale.


      Reply
    2. Matt McCoy

      “If the fundamental argument is that most of the public never sees the tail because of the “Tyranny of Choice” then how can the tail be interfering with their discovery? How is it even possible that “There is so much choice that there is effectively no choice at all”? That logic doesn’t work for me. Just how is it an “inconvenience” (as stated in the conclusion) to consumers to have more choice?”
      -Because the vast majority of people see the choices and they see it as too much for them to get through all of them that they would just rather listen to the music that they are the most familiar with and not bother with other different forms of music that they may no have any interest in to begin with. It also has to do with the amount of advertisement that popular artists have the advantage of using to promote more of their material than your typical independent artists or bands who may be limited money-wise to even generate that kind of publicity. That kind of marketing is important because your typical everyday person or youth doesn’t care about going to actual music websites to look up new bands because they don’t care. They just want to listen to whatever is popular nowadays so that they can fit in to the popular crowd so they don’t seem like ordained hipsters that are constantly being bashed all the time.

      “I’d like to see proof that the user experience is diminished by excessive choice.”
      -Like I said before, but to put it into more context, people these days are so preoccupied with other things in life that they just don’t have time to go through every single choice that is given to them because of work, school, or family. With streaming music for free with advertisements such as Spotify and Last.fm, people have now been able to experience new stuff more than say the last ten years but streaming a song by a certain artists on any of those lesser known artists is pretty much next to nothing compared to just buying a physical CD or LP.


      Reply
    3. toobad

      But they wont. The majority of the population will always be casual (passive) listeners. These people like ease and ease is the radio, TV, Friends and front page of itunes. They aren’t searching for shit.


      Reply
  11. Pablo Muir

    Shocking. News flash: artists with the biggest budgets and advertising campaigns make the most money.

    A large amount of choice is NEVER a bad thing for music fans. More access to more music you love, pretty much immediately. The only thing you could even consider calling a “down side” is that they have no emotional attachment to the music; it’s pick up and discard. So they rarely become actual fans of bands as much as just liking the odd song here and there. I guess a lack of socialising probably counts too, as live shows are a good place to meet like-minded people.

    This isn’t great for struggling artists, of course. We’ll always get outdone by the speed and simplicity of a risk-free online trial. Anyone can put up a website or Facebook page meaning everyone is fighting for clicks and sorting wheat from chaff can be a pain. Advertising buys clicks. Advertising sells songs. But only the big guns can afford it.

    The industry is controlled by the money, same as it always has been. None of this is new.


    Reply
  12. Ariel Sharon

    Exploitation by the 1% proletariat of the rest of talented masses. !


    Reply
  13. wubbwubb

    Music consumption is now dictated by television isn’t it?


    Reply
  14. Cliff Baldwin

    Look, most of the music consumption (not preview or radio listening or downloading, but consumption of entertainment value) is happening on YouTube and Pandora in the U.S.. YouTube has every commercially viable song ever recorded, curated playlists of radio-style video stations, and more active users than Itunes, Spotify, Beats and Amazon combined. Pandora has more active users than iTunes. We all know how much a songwriter or label gets paid off of a crappy online stream, if they are even properly fingerprinted and monetized in the first place. Most aren’t. There will always be (and always were) superstar artists, and big marketable hits, and a hit-driven business that has trained consumers to pay for the privilege of owning the image. The problem is now the whole business model is shot to hell, for everyone — everything is available for free. Napster ’99 was tame compared to what is going on now. Would you open a candy store next to a storefront that is giving every piece of candy away for less than a penny regardless of its value? Bad business to get into these days. Period. Make music because you love it, license it occasionally when you can, get a cut of the door where you play, make sure you upload your fingerprints to GooTube. But stop complaining. It’s over. Just like the gold rush, pets.com, and tulips. Nothing lasts forever.


    Reply
  15. mdti

    How many is 100%?
    it makes a difference wheter 1% is 25 or 25000 or 250000 artists.


    Reply

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