More Charts The Record Labels Don't Want You To See: Swedish Musicians Making More Money

from the artists-are-doing-better-than-ever dept

Mon, Dec 14th 2009 10:44am — Mike Masnick

We've already discussed the research on the UK music industry that shows both that live revenue is more than making up the decline in recorded revenue and that musicians themselves are making more revenue than ever before. Some people have suggested that this is a UK-only phenomenon, but a worldwide study found the same thing as well. And, now it looks like the same is being found in Sweden as well -- home of The Pirate Bay, which we keep being told is destroying the industry. Swedish indie record label owner Martin sends in the news on data from the Swedish music industry, which looks quite similar to the UK data. First, it shows that while there was a tiny dip in overall revenue, it's back up to being close to it's high, mostly because of a big growth in live music:

Chart by Daniel Johansson

Basically, recorded revenues dropped. Collections stayed about the same, but live grew. More importantly, though, is the second chart, which shows the revenue for actual musicians. And that's going in one direction: up.

Chart by Daniel Johansson

And yet, The Pirate Bay is destroying the ability to make music, right? Funny that the numbers don't seem to support that at all. Basically, these charts are showing the same thing that those other studies have shown. More music is being created. There is greater "discovery" of new music. There are greater revenue opportunities for musicians, and the only part of the business that appears to be suffering is the part that involves selling plastic discs. Yes, that sucks if your business was based on selling plastic discs, but for those who can adapt and adjust, there is more money than ever before to be made. That sorta goes against the claims that "piracy" is somehow destroying the industry, doesn't it?

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Filed Under: live, music, revenue, sweden

35 Comments

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Lobo Santo's Ugly Ferret, 14 Dec 2009 @ 10:56am

It's nice numbers, but it fails to address some simple points:

Are more concert tickets being sold (more attendance) or is it just that ticket prices have been jacked up?

Are artist revenues up, or are they failing to remove expenses off the other side, which were formally paid by others (not artists, not their revenues)? Essentially, where are artist NET revenues?

It also appears that, just like the UK numbers, the actual live and record is flat or down over the period. Is this the case? Why would there be no increase even considering things like inflation and such?

It would appear that the music industry, for all the "innovation" out there, is essentially flat (and down from a peak in 2002).
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- Will (profile), 14 Dec 2009 @ 11:13am
  
  Re:
  "Are more concert tickets being sold (more attendance) or is it just that ticket prices have been jacked up?"
  
  Either way they are making more money. If prices went up but people still pay means that the music has gotten better.
  
  "Are artist revenues up, or are they failing to remove expenses off the other side, which were formally paid by others (not artists, not their revenues)? Essentially, where are artist NET revenues?"
  
  That is what is shown in the second graph. The amount of money to artists has gone from just 880 to almost 1100 millions of SEK.
  
  "It also appears that, just like the UK numbers, the actual live and record is flat or down over the period. Is this the case? Why would there be no increase even considering things like inflation and such?"
  
  I think you got confused with the colors like I did. Live is blue in the top graph, but green in the second. It looks like live to artists is WAY up. While recorded to artists is down and SAMI to artists is up a bit.
  
  "It would appear that the music industry, for all the 'innovation' out there, is essentially flat (and down from a peak in 2002)."
  
  That might be because in 2002 there was a huge spike in recorded, but the other two continued to grow steadily. It may be because of a balance has not been met. Recorded will probably decline still while the other two continue to grow. Over time it will be a higher overall income, but for now it is more stagnant because of change.
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  - Will (profile), 14 Dec 2009 @ 11:15am
    
    Re: Re:
    I just found out that the first iPod was released in October 2001, with how big that has grown that might be why recorded would hit a peak in 2002 before everyone who had an iPod was file sharing so regularly.
    [ link to this | view in chronology ]
  - Lobo Santo's Ugly Ferret, 14 Dec 2009 @ 11:22am
    
    Re: Re:
    There is no indication that the second graph indicates net income, just gross.
    
    Basically, if artists are making more money up front (gross) but are then paying management, promotion, marketing, and other costs off the back side, what are they actually seeing net?
    
    Basically, is it a money in, money out sort of a thing? If what they were getting before was a NET after everything, of course the gross would be bigger, no?
    
    Also, there is no indication as to the number of acts this money is distributed over. There is no indication as to the "high and low" of the numbers. What percentage of the income is made by a small number of artists?
    
    Also, there is no indication if there has been a change in the live scene landscape. Have their been more pricey festival type shows? Has there been a regulator change that has allowed more live music in clubs, example? Has their been a shift in the country from recorded (dj) music to live music?
    
    Simple graphs don't answer the questions.
    
    However, one thing is clear - net, the consumers are not spending any more money on music today than they were 10 years ago, not in the UK,and not in Sweden either.
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    - moore850, 14 Dec 2009 @ 11:27am
      
      Gross vs. net
      I concur, there's no indication that the net live touring revenue per artist is up. Higher artist live revenue could indicate substantially higher performance costs at the locations -- in the USA tours are getting shockingly expensive as liveNation etc continue to take larger and larger cuts of an artists' gross tour figures.
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      - Ryan, 14 Dec 2009 @ 11:37am
        
        Re: Gross vs. net
        The graphs clearly show that artists are receiving more income from music. I fail to see why artists' live revenue would be directly proportional with performance costs; fans pay based on marginal value, not on the overhead for the artist. So even if you were right and venue costs have gone up for bands, that has nothing to do with either revenue or file sharing's impact on revenue.
        [ link to this | view in chronology ]
    - Suzanne Lainson (profile), 14 Dec 2009 @ 12:09pm
      
      Re: Re: Re:
      Also, there is no indication as to the number of acts this money is distributed over. There is no indication as to the "high and low" of the numbers. What percentage of the income is made by a small number of artists?
      
      I'd be interested in this as well.
      
      Here's what has happened in the US.
      
      "In 1982, the top 1% of artists took in 26% of concert revenue; in 2003 that figure was 56%. ... The top 5% of revenue generators took in 62% of concert revenue in 1982 and 84% in 2003.
      
      http://www.billboard.biz/bbbiz/content_display/industry/e3i7a35e791d5c3a260e0dadb8a3b6168fc "
      [ link to this | view in chronology ]
    - MCR, 14 Dec 2009 @ 12:20pm
      
      Re: Re: Re:
      While I completely agree that without the Net numbers, we can't really determine if the artists are making more, I find it amusing that you choose the side to reflect higher costs and lower profits (the side of the music industry). Couldn't it just as easily be lower costs to perform and even higher profits?
      
      I agree we can't determine either way, but you only mention one way. Just a little food for thought.
      [ link to this | view in chronology ]
    - Luci, 14 Dec 2009 @ 4:46pm
      
      Re: Re: Re:
      While it is true that the graph does not indicate that it is net income, it also does not indicate that it is gross income, so your own argument is equally disingenuous. If one cannot argue it one way, then you cannot argue it the other. Either way, the graph DOES show that MORE MONEY is coming in. Period. Arguing semantics does not help your cause.
      [ link to this | view in chronology ]
Anonymous Coward, 14 Dec 2009 @ 11:03am

I really wish people would quit picking on Lobo Santo. However, it is somewhat telling of how some people are to getting their feelings hurt.

Tell me, Ferret, as a child, did your dad touch you in funny places?
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- Will (profile), 14 Dec 2009 @ 11:46am
  
  Re:
  I didn't mean it as picking on Lobo Santo, I thought I had something to add to the conversation and turns out he was right after I looked more closely.
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Lobo Santo's Ugly Ferret, 14 Dec 2009 @ 11:03am

I don't usually do this, but I would also wonder: What would the graphs look like if you expanded them back say another 10 or 20 years, to the pre-file sharing times? Might we see an industry that was in constant, long term growth suddenly cut off like a hedge?

What do you think Mike?
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- Anonymous Coward, 14 Dec 2009 @ 5:58pm
  
  Re:
  "I don't usually do this ... "
  
  Yeah - right
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zcat (profile), 14 Dec 2009 @ 11:28am

I would like to see a version of this graph with 'losses due to piracy' added on top; an estimate of what the music industry think they ought to be making (over and above the record profits they're making at the moment.)

And please try to find numbers back into the 80's so we have a good pre-p2p baseline. I strongly suspect the curve goes UP as people discover more music and I'd like to see a graph that confirms it.
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Anonymous Coward, 14 Dec 2009 @ 11:36am

Wuts this?
This is of interest. I am worried about the connections between an ugly couch, an ugly mom, an ugly goldfish and an ugly ferret.

If you were abused ferret, we can get you out of that situation. But the first step is for you to realize it doesn't make it right for you to abuse Lobo Santo in the process.
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ECA (profile), 14 Dec 2009 @ 1:13pm

pOINTS TO PONDER
1. Ticket prices keep going up, and the Bands dont get most of that money.
2. If we had a stadium that could handle 1million people? could they fill it? 3 million show'd up in moscow for a Concert by JM Jerre'.
3. Digital security on music is stupid, it doubles the price and stops NOTHING.
4. AVAILABILITY and finding the MUSIC you like are the MAIN reasons to FIND illegal music. We arent all 16 years old any more.
5. IF the recording industry UNDERSTOOD the idea of DIGITAL music, and would augment their SYSTEM, they could make it cheaper and easier to release music. You could use a KIOSK system and the customer could PICK and choose, PAY, and it would Download the music DIRECT to you..and the system could store MILLIONS of music on the system, in a 4x4 BOX, in the FORMAT BEST for the customer.
6. COPYRIGHTS and TIME. the music industry has TONS of music that hasnt seen the light of day for 50+ years.. it should ALL be released to the public domain. ANYTHING over 20 years SHOULD be released..
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harbingerofdoom (profile), 14 Dec 2009 @ 1:42pm

first, how exactly do you think you are going to be able to see a clear accounting to get the net numbers in the first place? do you really think that the labels are going to make those numbers available?

second, lets assume they did make the numbers available....
with 30 years of artists popping up here & there saying they are getting the shaft by their label and the recent proof of extremely shoddy (and i still say completely illegal) accounting methods only an idiot would trust any numbers they gave without having them independently verified by some other means.
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- Lobo Santo's Ugly Ferret, 14 Dec 2009 @ 3:13pm
  
  Re:
  It isn't a question of making up numbers, but rather trying to get an apples to apples comparison.
  
  If the artists were getting X, but it was net of everything, and now they are getting Y, but it is before expenses, then how do you compare the numbers?
  
  Artists claim they get shafted, the labels lose their shirts on about half of the advance money they put out, and yet everyone gets rich and famous? Hmmm. Most often artists get "shafted" by themselves, signing away publishing rights, giving away song writing credits, and so on, all because they want on the gravy train so bad they don't care the price.
  [ link to this | view in chronology ]
- Suzanne Lainson (profile), 14 Dec 2009 @ 3:49pm
  
  Re:
  how exactly do you think you are going to be able to see a clear accounting to get the net numbers in the first place? do you really think that the labels are going to make those numbers available?
  
  The labels wouldn't be the ones to have the concert income numbers. Those would come from the artists and their managers.
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Big Al, 14 Dec 2009 @ 2:24pm

Business model?
It seems that here is a clear-cut business model for artists - WORK FOR A LIVING.
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vastrightwing, 14 Dec 2009 @ 2:26pm

The problem is that record company executives aren’t making as much!
No, the problem is all wrong. Who cares about musicians? They aren’t the ones who are suffering! It’s the big recording executives! You think these executives can get by when their chattel are allowed to give away their music? Facts about musicians completely misses the point the record companies are trying to make. They are the ones suffering and no one cares! Have some compassion!
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Rasmus, 14 Dec 2009 @ 3:55pm

The data
The data for those who want to create other graphs.

http://spreadsheets.google.com/pub?key=taH5JWabLc88pz3NGP20qkQ&output=html
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Rasmus, 14 Dec 2009 @ 4:16pm

The report
http://www.trendmaze.com/media/1038/swedish_music_industry_2000-2008.pdf
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- Lobo Santo's Ugly :, 14 Dec 2009 @ 4:38pm
  
  Re: The report
  What I find really amazing in this report is the parts that Mike didn't bother to quote or mention. I like this one:
  
  Although there was a notable decline in live revenues during 2005 and 2006 for
  these specific companies, the over all trend correlates well with the STIM figures.
  The live business is a highly volatile business and these particular companies, when
  combined, clearly had a decline in revenues during those years. What is important
  though, is that the overall trend is in compliance with the STIM figures.
  This does not necessarily mean that all artists, big and those starting a career,
  have received more money for their live performances in the latest years. The
  Internet and the World Wide Web has created new ways for musicians and artists
  to promote and distribute their music, services like MySpace, YouTube, Last.fm
  and Facebook have made it possible for artists to gather an audience early in their
  carrier, but, it is still very difficult for small artists to make a living on live
  performances.
  The increase in live revenues has probably benefited mainly artists that already
  have a successful carrier as well as a substantial back catalogue of recorded music.
  One could argue that record labels have invested large amounts of money in
  creating these artist brands during many years, brands that live promoters now have
  the possibility to use when the end consumer tends to pay more for live
  performances than recorded music.
  
  Interesting! The report itself draws a similar conclusion to some of us, that the lower end still isn't making a living at it.
  
  Further, there are other quotes mentioning the signficant changes already in 2009 (music sales revenues up 18%, digital sales up 80%), which suggests that piracy had a very significant and clear negative impact on music sales. With the IPRED and other moves in Swedish law, suddenly people are paying for music again and recorded music revenue is way up.
  
  Mike, would you say that this is an indication that not only to people value music, but they are obviously willing to pay for it when they can no longer safely and easily download it for free?
  [ link to this | view in chronology ]
  - Rasmus, 14 Dec 2009 @ 6:36pm
    
    Re: Re: The report
    Well, the creators of the report has done a very good job assembling interesting data.
    
    They haven't done such a good job interpreting those data. And the report is full of unsupported claims and guesswork. Such as the part you just quoted. They have abolutely no data to support what they say in that quote, since they haven't investigated it.
    [ link to this | view in chronology ]
    - Lobo Santo's Ugly :, 14 Dec 2009 @ 6:41pm
      
      Re: Re: Re: The report
      Just on the basis that they raise these issues is an indication that there is something to look at further.
      
      The major shift on sales in Sweden has been noted before:
      
      http://www.techdirt.com/articles/20091125/1018597087.shtml
      
      Mike tried his damnedest to try to make it sound like anti-consumer industry tactics were to blame, and buried the massive increase in sales in the body of the text. The real headline was the rapid uptick in music sales as soon as people realizes they couldn't infringe with impunity. Seeing sales up 18% overall and 80% increase in digital would be headline news if it went the other way. Most importantly, it would at least for 2009 signficantly reverse the trend and indicate that piracy has a significant impact on sales.
      [ link to this | view in chronology ]
      - Rasmus, 15 Dec 2009 @ 6:13am
        
        Re: Re: Re: Re: The report
        Or maybe the fact that the sales increase coincided with huge cuts in interest rates for housing-loan, means that many Swedish consumers, especially in big cities, suddenly found themselves with lots of more money to spend on music. Its common to have housing-loans with 1-3 months market adjusted interest rates in Sweden so interest rate changes has a very direct effect on consumer spending.
        
        And the 80% increase in digital is just what to expect when you look at the trend in buying patterns over several years.
        
        The report fails to look at those factors.
        
        From the data presented in the study you can only make two conclusion, which is:
        
        1. There is a rapid change in consumer spending away from recorded music towards live performance and the overall spending by consumers is mostly constant.
        
        2. Artists are getting a larger share of the revenue and recording companies less. Its unclear if the artists net income is rising but its very clear that this means more of the music industries revenue is in direct control by the artists themselves and not in the control of recording companies. This means a huge shift in power within the industry.
        
        Its a pity that that the authors don't focus on analyzing this very interesting fact, which they are the first to actually confirm with solid data, and instead spend a lot of the report repeating unverified claims made by the recording industry.
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  - Raybone (profile), 14 Dec 2009 @ 6:50pm
    
    Re: Re: The report
    dear Anonymous Coward Troll posing as Lobo Santo's Ugly ....you continually leave the "shit tap" on full blast when you comment. Its absolutely amazing and easy to see through your circular logic garbage...lets see
    
    you wrote: "Further, there are other quotes mentioning the signficant changes already in 2009 (music sales revenues up 18%, digital sales up 80%), which suggests that piracy had a very significant and clear negative impact on music sales."
    
    um no it doesn't suggest anything about piracy any more than it suggests that better music was released and people decided it was worth purchasing...or even that as more files were shared..more got to "try before you buy" and then went on to buy more of the music they liked..
    
    See how easy it is to "suggest" ? except I don't spout it as proof of anything unlike you and your completely transparent agenda. Go sell your brainless crap elsewhere.
    [ link to this | view in chronology ]
    - Raybones Ugly Ideas, 15 Dec 2009 @ 5:15am
      
      Re: Re: Re: The report
      Raybone, the only crap is the stuff covering your eyes and keeping you from accepting what appears to be a reality.
      
      for 8 years, sales of recorded music went down. There is nothing to suggest that any single artist or whatnot could suddenly change the course of the music industry overnight.
      
      However, IPRED and other parts of Swedish law came alone, TPB lost it's case, and "suddenly" people are paying for more music, and significantly, the sales of digital version almost doubles. Now, you can "suggest" all you like about a sudden burst in quality of music, and you are welcome to it, but it isn't supported by what is out there.
      
      Swedish law changed, it is much more difficult to P2P legally, the cloak of anonymous is more easily pierced, which makes it harder for people to "hide" online.
      
      So you can draw any conclusions you want, I drew mine, it happens to match up with a lot of the evidence that is around right now about sales, and that is all it is. If you cannot accept that perhaps, just maybe, that changes in the laws have changed people's habits...
      [ link to this | view in chronology ]
Anonymous Coward, 14 Dec 2009 @ 5:54pm

"but they are obviously willing to pay for it when they can no longer safely and easily download it for free?"

Reality called, it wants you to notice it.
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- Lobo Santo's Ugly Report, 14 Dec 2009 @ 6:24pm
  
  Re:
  I noticed. Perhaps you want to read the report, moron.
  [ link to this | view in chronology ]
The eejit (profile), 15 Dec 2009 @ 12:56am

That's interesting to read, ad definitely warrants further investigation.
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Anonymous Coward, 15 Dec 2009 @ 6:13pm

The increase in live revenues has probably benefited mainly artists that already
have a successful carrier as well as a substantial back catalogue of recorded music.
One could argue that record labels have invested large amounts of money in
creating these artist brands during many years, brands that live promoters now have
the possibility to use when the end consumer tends to pay more for live
performances than recorded music.

The TechDirt "Relevant Omission" strikes again!
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Suzanne Lainson (profile), 16 Dec 2009 @ 6:17pm

Very relevant to interpreting the report
http://www.danieljohansson.se/post/The-Swedish-Music-Industry-in-Graphs-Report.aspx
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M. Pettersson, 17 Sep 2011 @ 3:04am

Does this matter? The artists are still able to get many times higher income than most people, even though what they do, does not contribute to society.

Pure entertainment should not be this rewarding.
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