It’s 2019; look at that number again. 2019. Doesn’t that kind of blow your mind? We are pretty much closer to 2040 than we are to 1999. Is this what you thought it would look and feel like? I want to give you a realistic outlook on where we are as an industry and put some of the B.S. in perspective. I’ve had the honor of working with a few futurists on strategy and forecasting, and one thing I can always count on is that everyone is wrong. The experts, the dreamers, the futurists, the blowhards, all of them, wrong.
This is never truer than in the music industry.
Let’s unpack some of the hype vs. the reality.
By this point, I was told holographic concerts would be the norm; wrong. In fact, there is a backlash against them. I’m sure you have read in other columns about the “extinction” of downloads, “Music Downloads Will Be Dead by 2020,” read one headline; it’s all over. Yep, except for the $1.2 billion (billion, with a “B”) of revenue last year in the U.S. alone. Are download and physical sales declining? Sure, they absolutely are. But to call ONE BILLION dollars in revenue “dead” and “extinct” is disingenuous at best, and basically cheerleading the streaming future you want.
Blockchain! Notes! Bitcoin! Tokens! I know you’ve read about all of these in this very space. But, guess what, it hasn’t taken off. Bitcoin is worth half of what it was last year. Most of these new music services chose the Ethereum blockchain to build on, and ETH (Ether) is literally worth 8 times less than what it was last year – that’s what your payment would be tied to. This could all change tomorrow, but that’s where we are today.
Physical is dead! “Vinyl is a fad, cassettes are an anomaly and NO ONE buys CDs anymore.”
Right? Well, vinyl and cassette grew by double digits (12% and 19%, respectively) in 2018. Surprised? Did you know that 60 million CDs were sold in the U.S. in 2018? Probably not. All of this AFTER the industry has basically forced the shuttering of record shops, and forced big box stores to stop selling because they won’t stock them. Again, the numbers are dropping, absolutely. But that’s not the story you’ve been sold, is it?
Streaming is dominant and growing exponentially! Not true. Would it surprise you to know that the growth rate of every music streamer subscriber base – including Spotify and Apple Music – is slowing. That’s right, it’s growing, but slower and slower each quarter, meaning that they have reached a saturation point. Spotify grows by just 2% per month while Apple grows by 5%. I’m sure you’ve seen articles spouting numbers like “180 million subscribers” without mentioning that half of them (87 million) are Free Tier users. Apple Music says it has 56 million paid subscribers. All of these numbers fly around and it seems like streaming is so damned important and huge. Well, it is. But pump the brakes, those are all worldwide numbers. What if I told you that Apple Music has more paid subs than Spotify….in North America, it’s true. If I were to ask you how many people pay for Spotify in North America (Canada and the U.S.), what would your guess be? 40, 50, 60 million? How about around 20 million. Same for Apple Music at about 21 million.
Think about that for a second. Music streaming, we’re told, is how everyone gets their music. There are 226 million people in U.S. and Canada between 16 and 64 years of age, and fewer than 6% of them pay for a music subscription.
I could go on. Live concert ticket sales grew by 12% in 2018! But this is due to higher prices — not more fans attending. And, as I am sure you know, it’s increasingly hard to get fans off the Netflix couch and out to regularly support your growing number live shows locally.
Sync sales are up, but I can tell you from vast experience that the growth for independents is in micro-licensing, resulting in less overall revenue. I haven’t even mentioned how important genres are to these numbers, and haven’t even touched on recent reports that streaming royalties may actually be as low as half of what they were two years ago for most of you. If you aren’t in hip-hop or EDM, your numbers are probably down no matter what area you measure.
So, what is the “State of the Music Industry in 2019?” Murky.
The point I want to drive home with you is that these numbers should not drive what you do as an independent artist. Do not listen to the prognosticators, including me, if they tell you X is dying or Y is the future. The fact is this, there is no one way to do it today. There is no one fanbase, there is no one platform. You absolutely should experiment with blockchain streamers, you absolutely should be on every streaming platform, you absolutely should offer downloads, you absolutely should use social media and email to promote. Your niche may include vinyl or cassette lovers and you need to pay attention to that. Your live shows may have reached a limit in your local town or region and you need to be creative about video and livestreams to increase them. Or tour outside your home base.
Look, it’s not easy. This is an amazing time of upheaval and access in music, and the fact is you have to do much more than you ever have before to claw out a living.
The opportunities are there, but the answer is still the same – make music that people need to feel. Music that touches people on a Friday night to party, or helps them with a break up, or provides an escape from this messed up world.
That’s it. If you do that, I can’t guarantee money and success will follow; but if you don’t, I can guarantee it will not.
The best advice I can give you is to go write and record the best song you can today. It just takes one.
I can’t wait to hear it.
ABOUT THE AUTHOR
–Michael St. James is the founder and creative director of St. James Media, specializing in music licensing, publishing, production and artist development.
photo courtesy of underclassrising.net, used under a Creative Commons license