The traditional music industry is dying a slow, painful death, one that even Future the Savior might be powerless to save us from. Musical output may be at an all-time high, propelled by the likes of SoundCloud, Bandcamp and myriad other online services that allow artists to easily get their music to the masses. At the same time, artists actually earning revenue from their music is in a tailspin. Albums are quicky becoming obselete and streaming is leaving artists with very little compensation.
The idea of plunging musical money shouldn't come as a surprise, but it's powerful to have confirmation in cold hard facts. STATS, BRUH. Thanks to our friend Andrew Powell-Morse, a data analysis and visualization expert who recently supplied us with some great information concerning the dumbing down of popular music lyrics, we have some new information to ponder. Andrew took a a closer look at the different avenues through which these artists are counting dollars, pulling sales figures and adjusting for inflation, and directly comparing earnings and sales from albums and touring.
Let's first tackle album sales, the dire reality of which many are certainly more familiar. The album data used included the 20 highest grossing albums of each decade, beginning in 1980 and stretching to present day, and illustrates what many have been thinking. Unit sales are declining, to say it optimistically, and have been for some time. In addition, the price of an average album has decreased, so artists are bringing in less money per unit, and selling less units overall.
On the other hand, artists are also making more money than ever through live shows and touring. Powell-Morse looked at the top tours over the same time period, 1980-present, in terms of total revenue, number of tickets sold and the average tickets sold per concert. On average, the revenue is increasing! This would be great news for artists and the industry as a whole, if over the same span attendance was not declining. Unfortunately, attendance is also in decline, which means that less people are going to see live shows, yet those tickets are more expensive. Not exactly encouraging news for those hoping to replace falling music sales money with touring money for the foreseeable future.
So, ticket sales and album sales are both down, with the latter declining at a much faster rate than the former. Even with the increase in concert prices, it's far from enough to close the gap in lost earnings from releasing albums, and as Powell-Morse himself remarked, this “reinforces the idea that concert ticket sales are not going to save the music industry.” This becomes even more noticeable when looking at the top 20 earning artists for album revenue and tour revenue since 1980. While album earnings are somewhat evenly spaced, tour money heavily favors the top of the top. For the Eminems, the Beyoncés and the Rihanna's of the world, this might be enough, but for lesser known artists it becomes a question of whether live shows are enough of a draw to bring in necessary revenue.
The first question that needs to be answered by the music industry is what revenue source is going to counteract the loss in album revenue? For a few select stars, tours might be the answer. For others, publishing and placements in commercials, TV and Film. For the rest of the artists out there, the second question becomes will that be enough? If streaming is the answer, major changes in artist compensation will need to take place. With the speed in which industry changes are taking place, new questions are likely to emerge even faster than answers.
Fun Fact: The Rolling Stones have made nearly $2.5 billion in touring revenue, yet do not even crack the top 20 in revenue from album sales. If only this were the case for everyone.
[By Brendan Varan. He's feeling so nostalgic he might just go buy a physical CD. Follow him on Twitter.]