In 2017, the United States music industry raked in a whopping $US43 billion… and only 12% of this amount went to the actual musicians.
A new study conducted by Citigroup has found that tech companies, radio stations, and labels make the most from music sales… leaving the people who actually make the music with not that much.
In a new report published last night by Citigroup, it’s been found that musicians receive only 12% of music industry revenue.
Published last night, the new report finds that the percentage of revenue received by musicians has actually grown from past years. In 2000, the figure was a mere 7%.
The growth has been credited to live music attendance, as well as artists independently releasing their music – therefore pocketing more of the revenue.
“Currently artists are at the end of the line,” Bjorn Niclas (cofounder of Choon, a cryptocurrency-based music streaming service) says in the report.
“They get the smallest piece of the pie even though they are the ones creating the content. In any other industry you typically see much better returns and margins.”
Throughout the report, Citigroup outline three possible ways the music industry could give artists a larger share of revenue:
The first being through vertical integration of existing businesses (for example, concert promoters could merge with distribution/streaming platforms like Spotify).
The second option is horizontal integration (distribution platforms merging with each other), and the third is organic vertical integration (which would involve distribution companies such as Spotify entering the record label space).
Read the full report here.
Via Business Insider.