Though working out how to money from music is growing more difficult due to the problem of illegal downloading and the sheer number of creative artists out there, digital media is opening up whole new revenue streams. So how do artists make money? This article looks at the top income streams in the business, why they matter and how to use them effectively.
From global services like Deezer and Spotify to regional success stories like Rdio, KKBOx and WiMP, the subscription market is growing rapidly. Mostly centred around music videos, it's a model that 41% of people now say they use to find new music. With YouTube - watched by over a billion people worldwide - now planning to launch a premium subscription channel, artists choosing this route can expect even better reach and revenues.
Advertising-supported streaming services
Online music streaming services like YouTube and Vevo reach a global audience. It's free to upload music and, although revenues per view are small, they can quickly add up for those who successfully build fanbases or whose music videos go viral.
Digital downloads still account for two thirds of online music revenues. The trick to success is getting good distribution and marketing. Good music videos are one of the most effective ways to do this.
Broadcast media may not be the force they once were but internet radio is taking off in a big way. Pandora alone now has more than three times the listeners of all Clear Channel stations. Music with a hook, such as Christmas themed songs, does well on long term replay.
When considering how to make money in the music industry it's easy to overlook placement of music in films, TV programmes and adverts. This still accounts for 2% of music industry revenues.
Physical music sales
Sales of CDs and even vinyl still account for half of global revenues. With strong music videos to drive sales, albums and box sets can be an excellent way of making money from music, even for emerging artists.