The recently published Ernst & Young study that was commissioned by the French music industry body SNEP highlights the revenue split of a premium subscription of EUR 9.99 Spotify, Deezer and other comparable music streaming services. The study’s results confirm the conclusions drawn in the blog series “Is Streaming the Next Big Thing?” that – beside the music consumers – the (major) record labels are the main beneficiaries of the current boom of music streaming. In contrast, the musicians get just a small piece of the streaming pie and the streaming services for their part have severe problems to establish a sustainable business model. In the following, I would like to highlight and to comment on the main results of the study.
Posts Tagged ‘major labels
Tags: authors, composers, creators, Deezer, interpreters, major labels, music catalogue, music consumers, music majors, music publishers, music streaming, music streaming portal, music streaming service, music subscriber, music subscription, premium subscription, record labels, record majors, revenue share, revenue split, Spotify, streaming
Tags: Access Industries, ad-supported, Apple Inc., Beats, Beggars Group, Bertelsmann Music Group, Charles Caldas, Daisy, Deezer, download revenue, EMI, freemium, iHeartRadio, indie labels, initial public offering, IPO, iTunes Radio, Kleek, major labels, Martin Mills, Merlin, music streaming, music subscription, Pandora, rdio, royalties, Sirius XM, Sony Music Entertainment, SoundExchange, Spotify, streaming revenue, Tim Westergren, UMG, Universal Music Group, Warner Music Group, WMG, XL Recordings
The Beggars Group chairman, Martin Mills, recently told the Guardian that “(…) 22% of the label group’s digital revenues came from streaming – and that the majority of its artists earn more now from track streams than track downloads” in 2012. Though the article does not report absolute figures, the revenue can be considered rather high with a roster including Adele, Jack White and The xx.
A member survey of the global rights agency Merlin representing more than 20,000 indie labels including Beggars Group/XL Recordings, Rough Trade, Naïve, Tommy Boy, Cooking Vinyl and Naxos unveils that “92% of respondents saw streaming and subscription revenues grow between 2011 and 2012, with a third enjoying increases of more than 100%” as recently reported by Musicweek. The same study shows that 24% of indies across the world and 30% of European indies generated more income from streaming than downloads in 2012.
These figures suggest that music streaming seems to be a promising revenue source for record labels. In the following the economic potential of music streaming and the underlying business model are analysed from the record labels’ perspective.
In this blog the early music industry in Australia was analysed in great detail (The Early Record Industry in Australia – part 1, part 2, part 3, part 4, part 5 and part 6). In a four part series on the Australian music business I would like to highlight the recent economic situation of the Australian music industry. In the first part of this series the charts of the Australian Recording Industry Association (ARIA) are analysed to understand the consumers’ taste downunder especially in respect to the Australian national repertoire. In the second part the question is answered, which labels benefit from the chart successes of international and domestic artists. In a third part the development of the recorded music sales in Australia from 2000 to 2011 is analysed to give an explanation for the ups and downs in the observed period. In the fourth and last part of the series the economic role of collecting societies in Australia is highlighted especially from the licensing income’s perspective.
However, in the following the question is answered which labels succeeded in the ARIA charts and the role of indie and major labels a highlighted for the observed period.