Some artists have unveiled their royalties’ statements highlighting that just a small proportion of their income comes from music streaming services (e.g. cellist Zoe Keating in February 2013). However, the question remains open if and how the superstars benefit from shift to the music streaming business? In the following analysis the top superstars’ income from recorded music sales, music streaming, publishing and touring is highlighted. The statistics are based on the Billboard Money Makers List 2015 for the 40 top earners of the US music business. See here for the methodology.
Music Streaming Revisited – The Superstars’ Music Streaming Income
The Billboard Magazine annually publishes the music’s money makers top-40 earners list. The figures, however, are limited to revenue sources in the US covering Nielsen SoundScan and Billboard Boxscore figures as well as a formula for publishing income from statutory mechanical rates for digital sales and streaming. Thus, neither income from branding, merchandising, synchronization and sponsorship nor revenue sources from outside the US are included. Nevertheless, the figures give us a good impression of the relevance of music streaming income for the superstars of the music biz.
Figure 1: The Billboard Money Makers List 2015
A superstar of the top-40 earners’ got US $297,883 on average from music streaming in 2014. This is the smallest amount of money compared to other revenue sources. First ranks income from touring with an average of US $11.7m, followed by recorded music sales (physical as well as digital album and track sales) with US $2.0m and by music publishing revenue of US $621,000. Therefore, music streaming just accounts for 2.18 per cent of the overall music income of an average top star in the US.
Figure 2: The relevance of music streaming in the income mix of a superstar
P!nk earned the medium income of US $214,000 from music streaming. Her streaming revenue ranks exactly in the middle of the list headed by rapper EMINEM with US $1.1m and alternative rock band Phish on the other end with just US $7,500 for 2014. It is worth noting that Phish is just four ranks behind EMINEM, who occupied the 20th place in the overall earnings list. EMINEM’s streaming income of US $1.1m is lower than his revenue from publishing (US $1.5m), recorded music sales (US $4.2m) and of course touring (US 5.2m).
Figure 3: The music streaming income for the music business’ top 40 earners (in US$)
Touring is by far the most important income source for the superstars. Almost all top-40 earners had an income from touring of more than US $4.0m. All top-10 acts of the Money Makers List 2015 show a revenue share of music touring income of more than 80 percent. There is just one exception. Taylor Swift was not on tour in 2014, but released her latest studio album “1989” cashing in US $9.4m, which puts her on the first place in the category of income from recorded music. Compared to music sales and publishing revenues of US $3.5m, music streaming accounts for just 4.50 per cent (US $608,100) in her overall income mix.
Figure 4: The revenue mix of the top-40 earners of the Billboard Money Makers List 2015
Taylor Swifts’ income of more than US $600,000 per year from music streaming is respectable, but compared to the usual earnings of a superstar is not more than the butter on the bread. If we look at the streaming income of other well-known stars – Billy Joel (US $188,900), Elton John US $167,500), The Eagles (US $158,200), Bruce Springsteen (US $109,000) and Cher (US $17,700) – they could not earn a living from music streaming alone. In a broader perspective, we can conclude that music streaming is not a sustainable income source for lesser known artists than the top-40 music money makers. Therefore, musicians in these days have to collect their earnings from a lot of different income sources, but especially from playing live. And this hold also true for the superstars whose main revenue source is touring. These figures mirror the new rules in the digitized economy where selling music is not the main business model anymore – at least for artists.
Billboard.biz, “Billboard Money-Makers List: Music’s Top Earners of 2014”, May 1, 2015 (retrieved 2015-07-13).
The Guardian, “Musician Zoe Keating reveals iTunes, Spotify and YouTube payouts for 2013”, February 24, 2014 (retrieved 2015-07-13).
 The methodology of the Billboard Money Makers List 2015 according to billboard.biz: “Money Makers was compiled with Nielsen Music and Billboard Boxscore, 2014 U.S. data only. Revenue from merchandising, synchronization and sponsorship is not included. The following royalty rates, minus a 4 percent producer’s fee, were used: album and track sales, 22 percent of retail revenue; streaming revenue, 22 percent for current acts and 50 percent for heritage acts. Publishing royalties were estimated using statutory mechanical rates for album and track sales and the Copyright Royalty Board streaming formula; for labels’ direct deals with interactive services, blended audio and video rates of, respectively, $0.0075 and $0.0045. (A 10 percent manager’s fee was deducted from each category.) Touring revenue equals 34 percent of an act’s Boxscore.”