In our new report, “Same Heart. New Beat. How Record Labels Amplify Talent in the Modern Music Marketplace”, we examine how modern record labels have remade themselves to thrive in the era of streaming music. Based on almost 50 interviews with top-level executives at both major and independent record labels and commissioned by the Recording Industry Association of America (RIAA), we dig in to the changes that have taken place in the past decade to make labels an indispensable partner for the most ambitious new, developing, and superstar artists.
The most sweeping update of American music copyright in a generation is now law. In this episode of Musonomics, Larry Miller talks to three people that shaped or closely followed this bill from draft to signing: Jacqueline Charlesworth, Mitch Glazier, and Robert Levine on why the Music Modernization Act was so urgently needed, how it came to be, and what happens next.
By Larry Miller
as published in Billboard October 5, 2018
The Music Modernization Act, now set to become law, is silent on one big remaining issue for the music industry: U.S. AM/FM radio stations pay nothing to broadcast the sound recordings they play.
Music is all around us, all the time – as we shop in a store, eat in a restaurant – or work off those calories in a spin class. In this episode of Musonomics, Prof. Larry Miller from the NYU Music Business Program explores the evolution and licensing issues of background and foreground music used in businesses, from the birth of Muzak in the wartime factory — and then we shift into overdrive with Soul Cycle’s rawk gawd Sean Linehan on how he sculpts the playlists for each of his sold out spin classes.
For millions of us, artificial Intelligence got real when we added smart speakers to our homes. Our AI assistants are standing by, ready to play music, turn on the news, start the oven, or see who’s at the front door. But as they make life easier, they’re also creating new challenges for the music and entertainment industries. And then there’s the matter of security…just how smart do we want our AI devices to be?
Amazon, Google, and Apple are all now competing to be the smart speaker in our homes — and cars. As their underlying voice assistants become more integrated in our homes, the entertainment industry must rethink how to reach these consumers. How will Alexa, Google Home or Siri travel beyond our households and into the connected car? In this episode of Musonomics, we’ll hear from industry reporter Cherie Hue and Larry Rosin of Edison Research.
Digital music services continue to drive recovery of the music industry after a long period of decline, and the AM/FM music radio business is starting to feel it. Young people born after Millennials don’t use radio the same as previous generations. Can commercial AM/FM radio compete with pure play digital music services? Russ Crupnick of MusicWatch and Steve Goldstein of Amplifi Media join us to discuss what’s happening to radio listenership, and how radio needs to respond to the threat posed by unlimited, commercial-free music.
The way radio pays for music it uses may have acted as a kind of an economic disincentive for radio to invest in its own digital future. AM/FM radio broadcasters in the US pay a tiny amount, about 4% of revenues, to songwriters and music publishers, but American AM/FM stations are exempted from paying anything to the artists who performed the music or their record companies. This exemption doesn’t apply to digitally delivered radio streams, like SiriusXM or Pandora, or even the digital streams of AM/FM radio broadcasters.
Edison Research’s “Share of Ear” report shows that AM/FM radio is responsible for over half of all time spent listening to music in the U.S. among listeners 18 and older. Radio believes the power of its strong, local brands will insulate it from digital competition. However, this may not be the case in the car as the dashboard reconfigures around connectivity with advanced digital services. The car is currently the number one location for listening to radio, and automotive is the number one revenue category for radio. The connected car and its multiple audio offerings may be the greatest threat to AM/FM radio broadcasting, with 75% of new cars expected to be connected by 2020. Listen to this episode of Musonomics as we dive into the uncertain future of radio.
It’s not a secret that live music has kept many artists afloat as the recorded industry has cratered. But fifty percent of last year’s top 100 grossing acts are over 50 years old. Mick Jagger is 73 years old. So what will happen to the live music industry when they’re no longer around? On this episode of Musonomics we’re talking about the future of the live music industry and rock’s demographic crisis. Neil Shah, a staff reporter at The Wall Street Journal, is wondering whether the next generation of artists will be able to command the same ticket prices and bring the same revenue to fill the hole that would exist when Mick Jagger no longer sings “Satisfaction” at sold out stadiums. And if they do — are they gonna be able to do it for the next thirty years?
Music festivals are a big source of income – especially this time of year. Over 32 million people attend music festivals in the US every year. This year’s Coachella sold out in only three hours after the lineup was announced in January. Over the last ten years, concert promoters have been buying stakes in music festivals. Live Nation recently became the majority shareholder in Bonnaroo and the Isle of Wight and is now producing over 60 festivals. AEG Presents, the world’s second largest music promoter, is producing 18, including Coachella the highest grossing music festival. Neil Shah says the promoters are looking to take stakes in a business that will increasingly provide a bigger share of live music revenues.
But it’s not all sunshine. 2016’s Bonnaroo was the least attended in that festival’s 15 year history. And both Tomorrowland and Wakarusa cancelled their festivals last year. This – paired with a lot of lineup overlaps – has raised the question whether we have in fact reached what’s been called peak music festival. Cherie Hu writes about music and technology in Forbes. She thinks characterization of the current scene as “peak festival” is an oversimplification. To get to the bottom of the claim that festivals have a lot of lineup overlaps, she analysed the data from nine upcoming festivals. Hear what she found out in this episode of Musonomics.
China has the largest population in the world and an economy that keeps growing at a steady pace. But China’s music industry is still the size of small European countries like Austria and Sweden. Why is that? On this episode of Musonomics we take a look at the Chinese music market, so full of potential and changing more in the last five years than in the last 50. We’ll address how decades of piracy have shaped consumer behavior; discuss the major players when it comes to Chinese streaming services and project what will happen in the next few years.
You’ll hear from Ed Peto, the music executive who moved to China to build a bridge between the Chinese music market and the western music industry. Ten years later he’s running Outdustry and helped launch the selling record ever — Adele’s 25 — in the Chinese market.
You’ll also hear from Billy Koh, the Simon Cowell of China with a long view of the Chinese music industry. Billy is a popular judge on the TV talent shows and also the founder and CEO of the hit-making record labels Ocean Butterflies and Amusic Rights Management.
We know you probably don’t buy CDs anymore, and that you’re not reading the lyrics from the CD case insert. That doesn’t mean you don’t feel the need to look up the lyrics from time to time, right? Especially those fast-paced rap songs, they can be really tricky to figure out by just listening. But when you go online to do that, have you ever thought about whether these lyrics sites have the right to publish those lyrics and make money off of the ads on the site? Probably not.
On this episode of Musonomics we talk about lyrics licensing and how the changes in the music industry are affecting the hardworking people who wrote those lyrics – the songwriters.
You’ll hear from Darryl Ballantyne, CEO and founder of LyricFind. It’s a company that up to date has licenses with over 4,000 music publishers, to try and make sure that the songwriters and right holders are compensated for their work when the lyrics end up online. How did he come up with the idea to start licensing lyrics and how did the music publishers react?
In the end, the people losing out on unlicensed lyrics being published online are the songwriters, so we also talk to Phil Galdston, whose songs have sold 70 million copies worldwide. What’s his take on the songwriters’ struggle to be able to sustain themselves by just writing songs in the digital era? And if you want to hear a longer version of the interview with Phil Galdston, you can find it here.
Let’s start with the good news. In 2016, the music industry saw two consecutive quarters of growth for the first time in over a decade. This growth, largely due to an increase in streaming subscription revenue, sparked the interest of financial institutions like Goldman Sachs and Credit Suisse that see a very promising future for the industry.
As for the bad news; in the next 4 years the American music industry could face unpredictability on all fronts of the business like never before. Unpredictability is a concept that we in the music industry are all too familiar with. But as we leave 2016 behind and enter the first year of a Donald Trump presidency, we find ourselves in a time of unusual uncertainty and apprehension, not unlike the rest of the U.S.
Uncertainty is not good for business and as a result, investment, that is already hard to acquire in the music industry, will become scarce. As consumers begin to grow unsure of the future, spending on entertainment like music will likely see a hit as well, affecting the streaming subscription revenue that brought growth this year.
Trump’s unpredictability and his lack of comment on music industry issues like copyright reform make it hard to tell whether or not he will make any changes to current copyright laws to help songwriters and artists. This is one of the reasons that, like much of the nation, a large part of the music industry that had been banking on Hillary Clinton’s victory and even funding her
campaign, was shaken by the results of the election.
The musicians and business executives in the industry that pride themselves on diversity and freedom of speech were also dismayed at the victory of Trump’s racist and sexist rhetoric.
With so many musicians speaking out against Trump, the one silver lining we might witness is the return of protest music. In this respect, the live music industry may see a rise in revenues as those who are opposed to Trump’s views come together at concerts. The harsh reality, however, is that the rise of protest music against Trump might also affect his decisions on policy. Trump, who has a track record of being easily offended and vengeful, already spoke out against “unfair” protests that
took place after the election. Protest music, although it is so important at this time, may offend Trump and reflect in his policy decisions, especially for copyright reform.
At the same time, it is also true that Trump has a vested interest in copyright due to his involvement in the entertainment industry. Although much of his campaign was focused against lobbying and against the influence of special interest groups on policy, it is clear from his actions since the election that he is going to do a lot of things to help himself and his businesses. Trump owns about 30 copyrights that come from various projects he has been a part of or owned, including the television show The Apprentice, and this gives him an incentive to push for copyright reform to help copyright owners like himself.
At this time, all we can do is speculate. The only thing that has been consistent throughout Trump’s campaign has been inconsistency and there is no reason to expect any different from his presidency. There is no doubt that Trump’s policies and the members he appoints to his cabinet will have an effect on the economy of the country and the workings of all industries, including the music industry.
Still, great music comes out of difficult times. From the jazz music that surged out of Nazi Germany to the soul singing of Sam Cooke’s A Change Is Gonna Come out of the Civil Rights Movement, history has shown that difficult times bring inspiration for great music; the kind of music that brings people together, helps them fight and provides anthems for their fight. The hope is that the music industry will come out of the next four years as a stronger knit community, providing hope and comfort to those who are afraid for the future of this nation.
Brooks, Dave. “Five Ways the Trump Candidacy Will Impact The Music Industry.” Amplify. Amplify Media Inc., 09 May 2016. Web. 24 Dec. 2016.
Erickson, Kevin. “What A Donald Trump Presidency Means For All Musicians And The Music Business.” Hypebot. Hypebot, 14 Nov. 2016. Web. 24 Dec. 2016.
Grossman, Marla, and Gene Quinn. “Trump on Copyright: How the Trump Administration Will Approach Copyright Law and Potential Copyright Reforms.” IPWatchdog.com. IPWatchdog Inc., 17 Dec. 2016. Web. 24 Dec. 2016.
Rau, Nate. “How President Trump Could Be a Boon for the Music Industry.” The Tennessean. The Tennessean, 11 Nov. 2016. Web. 24 Dec. 2016.
Versace, Chris. “Will Donald Trump Make the Music Industry Great Again?” Newsmax. Newsmax Media Inc., 29 Nov. 2016. Web. 24 Dec. 2016.