Change – Feb 2024
In the Music360 project we aim to provide more transparency for creators in the value of their music. And by conducting research we aim to prove how music can be of added value for venue owners. Of course, we look at this from the perspective of the current music eco system. But when looking at the value of music for creators and/or consumers is sometimes good to zoom out over the decades in the past. This because there are always elements outside your circle of influence.
The music industry has undergone transformative changes over the last 5-6 decades, affecting both the number of singer-songwriters and consumer spending. Each era has been shaped by advancements in technology, shifts in consumer behaviour, and the evolution of business models. However, comparing these decades is challenging due to the vastly different contexts, akin to comparing apples and pears. This blog outlines the evolution of singer-songwriters and consumer spending, highlighting key differences across decades.
1960s-1980s: The Golden Era of Physical Media
Number of Singer-Songwriters:
- The number of singer-songwriters was relatively small, as the music industry was dominated by major record labels.
- Labels acted as gatekeepers, selectively promoting a handful of singer-songwriters such as Bob Dylan, The Beatles, Michael Jackson.
- Aspiring singer-songwriters faced significant barriers to entry due to the high cost of recording and distribution.
Consumer Spending:
- Consumer spending focused on purchasing physical formats like vinyl records, cassettes.
- Albums were priced at €5–€10 (equivalent to €25–€50 today), and fans spent heavily on these physical products.
- Concerts were a secondary revenue stream but offered relatively affordable ticket prices.
- Total global music revenues peaked at over €20 billion annually by the 1980s.
1990s-2000s: The Rise of Digital Disruption
Number of Singer-Songwriters:
- The introduction of affordable home recording technology and platforms like MySpace allowed more singer-songwriters to enter the scene.
- Despite this, mainstream success was still heavily reliant on securing a record label deal.
- Piracy and digital distribution disrupted traditional pathways, but independent artists began gaining visibility.
Consumer Spending:
- The 1990s saw a boom in CD sales, with albums priced at €15-€20. Total music revenues peaked in 1999 at €23 billion globally.
- By the 2000s, digital piracy through platforms like Napster led to a sharp decline in consumer spending on music.
- Spending shifted towards live performances and merchandise as artists sought to compensate for lost record sales.
- The industry experienced a steep decline, with global revenues dropping to €14 billion by 2014.
2010s-Present: The Streaming Revolution
Number of Singer-Songwriters:
- The barriers to entry have nearly vanished, leading to an explosion in the number of singer-songwriters globally.
- Platforms like SoundCloud, Bandcamp, TikTok, and YouTube have enabled artists to self-publish and build direct fan bases.
- The market has become saturated, making it more competitive, but niche and independent artists have found opportunities to thrive.
Consumer Spending:
- Streaming platforms like Spotify and Apple Music dominate, with revenue per stream ranging from €0.003 to €0.005. (this as an indication knowing due to all the plans there is no fixed stream rate)
- Consumers now spend €10-€15 per month on subscriptions, less than they did on physical media during earlier decades.
- Live music has become a primary source of revenue, with ticket prices and event spending skyrocketing. The global live music market exceeded €25 billion in 2022.
- Direct-to-artist platforms and crowdfunding have emerged as new avenues for fans to financially support artists.
Why is it hard to compare the different eras and in fact is it comparing apples and pears
- Technological Contexts:
- The 1960s–1980s relied on physical distribution, while the 2010s onward operate in a digital-first world.
- Advancements in recording and distribution technology have redefined accessibility for artists and consumers.
- Consumer Behavior:
- Earlier decades focused on ownership (buying records and CDs), whereas modern consumers prioritize access (streaming subscriptions).
- Spending patterns have shifted towards live music and direct artist support, making euro-for-euro comparisons misleading.
- Revenue Sources:
- In the past, recorded music sales dominated revenues, while today’s industry relies heavily on streaming and live events.
- The diversification of revenue streams (e.g., licensing, merchandise, crowdfunding) makes the modern landscape more complex.
- Global Reach and Accessibility:
- Earlier decades were constrained by physical distribution networks and regional barriers.
- The internet has globalized the music industry, enabling singer-songwriters to reach audiences worldwide instantaneously.
Conclusion
The evolution of the music industry has fundamentally changed the landscape for singer-songwriters and consumer spending. While earlier decades relied on physical sales and gatekeeping by major labels, the modern era’s digital platforms and streaming services have democratized access for artists and consumers alike. However, comparing these eras is inherently difficult due to differences in technology, consumer habits, and revenue models. Each decade represents a unique chapter in the history of music, highlighting the adaptability of both artists and the industry as a whole. Are you also curious how the music industry will adapt to the next, AI driven, decade.
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