I've been working on a book chapter recently dedicated to investigating and clarifying a set of issues that are typically wreathed in a haze of half-truths and propaganda: namely, the question of how much money recording artists and composers actually make from recorded music, whether distributed via traditional channels (e.g. CD retail and radio) or new and emerging channels (e.g. MP3, webcasting and on-demand streaming). These numbers are surprisingly difficult to arrive at, and even a thorough investigation such as mine can only generate approximate figures, given the diversity of contracts and economies under study and the opacity of music industry organizations.
This is a subject that's been investigated before, by researchers and musicians alike, but I was still driven by the lack of clarity, the conflicting viewpoints and the fact that no easily-comparable numbers existed in the public sphere to weigh the strengths and weaknesses of different distribution channels for creative professionals.
While I was working on the chapter, the whole Taylor Swift/Spotify dustup took up a few mainstream news cycles, which added increased salience and immediacy to the chapter (which probably won't see print for at least another year), but also dumped a ton more rhetoric and disinformation into the public sphere.
Here's a table from the article comparing some of my quantitative findings, as well as the abstract. You can download the whole thing for free from SSRN. If you've got thoughts or clarifications, please let me know; I've got some time to revise the chapter before it goes to print.
Abstract:Since its inception, the recorded music industry – composed of recording artists, composers, record labels, publishers and a myriad of other stakeholders – has been a tumultuous, ever-changing economic battle royale. Each new law, technology or market shift has presented strategic threats and opportunities enabling some to gain a “larger piece of the pie” while others divvy up the dwindling remains. Yet the market disruptions introduced by digital media at the turn of the 21st century have introduced a degree of volatility and uncertainty that makes the previous century’s ups and downs look stable and placid by comparison. One effect of these disruptions has been to intensify the ongoing battle royale – legacy stakeholders seek to protect their margins and market dominance, rival upstarts wish to carve out their own slices, and creative professionals see a long-awaited opportunity to exert some financial autonomy and creative control over the product.
To the extent that these disruptions are covered in the press or understood by the general public, the situation is often depicted monochromatically, from the perspective of a given stakeholder. Recent examples include campaigns for higher streaming audio royalties by artists like David Lowery and Taylor Swift, campaigns for broadcast royalties for recording artists by musicians like Blake Morgan, campaigns for parity between online and off-line radio royalties by organizations like Pandora and, of course, campaigns for and against peer-to-peer distribution platforms by record labels and technologists.
In this chapter, I present a nonpartisan analysis of past, current and proposed methods of “slicing the recorded music pie” in the U.S. marketplace, with an aim to clarify exactly what’s at stake, and for whom, and to correct and counteract some of the more vitriolic and less accurate rhetoric that has governed the public debate of these issues thus far. It should be abundantly evident even without such analysis that there is no “silver bullet” utopian scenario in which every party concerned, from artists to labels to consumers, benefits without a corresponding expense on the part of some third party – in other words, there can’t be an infinitely large pie with an infinite number of slices. Nor can there be a single organization or sector that wins out at the expense of all the rest; compromise is inevitable, and the challenge is in shaping its contours, rather than avoiding it.
Yet, while no single stakeholder in the recorded music economy can expect to see new laws, policies, economies and technologies conform exclusively to its worldview and agenda, there are still more and less equitable ways to divide the industry’s wealth, and to develop methods to insure its continuing growth and innovation. Consequently, this chapter will conclude with a brief analysis of pending policy proposals, outlining what’s really at stake and for whom.