It was recently reported that artists had only received 12% earning of the $43 billion dollars the music industry made last year, a 7% increase from the year 2000. According to The Fader, “the slight bump in revenue for artists is thanks to an increasing reliance on concerts for income.” The article continues to say that the report made by Citigroup, states “Artists will capture a larger share of the music ecosystem’s revenues driven by continued shifts in revenue towards concerts and new entrants into the record label role.”
In a recent article by Billboard, they dissected the Citi report, stating that the report was not convincing, to begin with. The article stated, “Saying artists make 12 percent of industry revenue is like saying a bar that Jeff Bezos walks into is full of people with an average net worth of more than a billion dollars — it’s completely beside the point.”
Now, it is also being said that within that music report, there are more incomplete and incorrect statements. According to a previous article from Billboard, major companies that were included in the report did not hear from the analysts prior to publishing the report. Also, U.S. entertainment, cable, and satellite analyst for Citi, Jason Bazinet, confirmed “that the report’s main source of data was SEC documents because that’s where we’re going to get the best financials alongside books such as Donald Passman’s All You Need To Know About The Music Business, rather than direct interviews with industry reps.”
In the same article, it was suggested that the data points used in the arguments, specifically the record contracts and licensing deals, are inaccurate. A comment from an indie-label source stated: “It moves between these descriptions of aggregate revenues across the industry, and then framing those numbers as if it’s representative of an individual artist’s career, and that’s just not true.”
The RIAA also made a comment surrounding the royalty rate of YouTube. They state “Thanks to their mistaken U.S. numbers, the analysts imply a per-stream royalty rate of $0.003 for YouTube, which is much higher than seen in other public reports.”
The FMC (Future of Music Coalition) a non-profit organization based in Washington D.C., expressed their opinion about the matter in a series of tweets. They expressed that in order to see how the actual artists are doing, talking to the actual artist is the best thing to do, which the report did not do. The organization also screenshotted a segment of the report, suggesting that the report is “wrong on many levels.” See their tweet below.
They continue to tweet that the rosters at music labels are smaller now that artists are taking the DIY route with their music, which musicians are not making their craft to impress record labels.
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