The Rich and The So-so in the Music Industry

When we hear the famous names in the music industry such as Lady Gaga, Justin Bieber and Katy Perry, it really makes us wonder how much do they actually make? With the raising concern of free downloading and streaming, the selling of the actual album is declining from year to year. People prefer to download it free from internet or streaming rather than buying the actual albums, yet the income they make from streaming may not be that satisfying.

http://www.kpoplyrics.net

According to The Root, the actual singers make only a small portion out of their effort. It is the 13% out of the overall income makes. Still, from the 13%, it is still shared with the personals within the band. According to Nielsen research, only $1 to $2 is made for an album sold for the singer, except for indie album that can reach $9. However, it varies between the contract. For example, TLC that hit 9 million selling album, was declared bankrupt because of the poor contract.The income made from YouTube, iTunes Match or Spotify may not be as much as our expectations. Josh Davison from Parks and Gardens stated that he only gets 1 cent for every 3 songs played in iTunes Match. Even from YouTube as well, the Dead Kennedys video by East Bay Ray that has been watched for 14 million times, yet he only got few hundred dollars from YouTube.

http://www.theroot.com/

Thus, we can see now, how low the distributors and the record label pay the singers, it makes it very hard for the newbie to actually earn some money and survive the music industry.  However, some of the successful example in the music industry such as PSY has proved that uniqueness and creativity in the music industry is crucial. The just-famous artist has made $13.5 million for 3 months (For more info please click here. The question is whether all those money is made from YouTube which has hit nearly 590 million views today, or from any other source. Psy will earn $2.5-$5.0 for 1000 views, $0.05 per subscriber view and $0.01 per channel view which approximately about $600,000 to $1,000,000 (according to KGB Answers). That number is even not 10% from its income for Gangnam Style. So where does the income come from?

Dealing with low-payment streaming and free downloading, artists have to be smart to be rich; concert is the answer. So far, the experience of going to concert still cannot be replaced with anything else. Seeing the real artists singing their songs, the vibe during the concert are still appreciated by the music lovers. The amount of money made from concerts is a big deal too. As we can guess from PSY case, the money he made outside YouTube will probably mostly come from his concerts.