Future Of Music Coalition publishes case study revealing artist revenues

From The Future Of Music Coalition

The Future Of Music Coalition has published a case study profiling artist revenues in a number of occupations: Jazz Bandleader-Composer, Indie Rock Composer-Performer, Jazz Sideman-Bandleader, Professional Orchestra Player and a Contemporary Chamber Ensemble.

Drawing from 4-12 years of accounting data provided by the artists, each case study graphs and explains the musician-based sources of income over time. The reports also include annual revenue pies, and a look at income versus expenses and net profit over time. Some case studies also include more detailed breakdowns, such as PRO royalties by territory, or session work by bandleader. The second release of case studies will be around May 2012 and is expected to include an urban recording artist, a background musician who does television work, a band that gets radio airplay, and a composer/songwriter who does not perform.

Case Study Demographics
Despite having very different financial pictures, there are some things that these musicians have in common:

•5 out of 5 artists spend all their time doing music.
•5 out of 5 derive all of their income from music.
•5 out of 5 are professionally trained. Each of them has a degree in composition and/or performance.
•5 out of 5 have been active for more than 10 years.
•5 out of 5 are performers.
•3 out of 5 are members of a performance rights organization: the jazz bandleader, the jazz sideman, and the indie rock composer. The others are not composers.
•3 out of 5 are members of either AFTRA or AFM.
Also, each artist seems to be at a place in their career where they have built some momentum. In every case, these artists’ gross revenue in the most recent year was higher than previous years. Some likely reasons include:

Similar career patterns.They have been working professionally since around 2000, and have now established themselves as professionals in their field. The data suggest that, even though they work in different genres, career arcs for performers can share some similarities.

We also suspect that there is some self-selection bias at work; it’s possible that artists who are organized and confident about their financial picture would be more likely to participate in this case study process, which can take months and involves detailed assessments of their accounting.

What Case Study Findings Tell Us About Musicians’ Revenue Streams
For performers, performance is the essential revenue stream. Each of these case study subjects are, primarily, performers. Some lead their own bands, others are sidemen or salaried players, and some play multiple roles. But in almost every instance, their annual income is highly dependent on how many shows they play. Indeed, if they stopped playing live, their incomes would plummet.

Performance is important for a number of reasons: first, it’s a creative choice. All of our subjects chose these careers because they enjoy playing music for live audiences. Second, it’s a controllable source of income. The jazz sideman receives guaranteed payments for his gigs with various bandleaders, and he is paid directly for this work. The jazz bandleader, meanwhile, takes on greater risks and costs, but he earns money for each performance. The same is true of the contemporary chamber group; the overwhelming majority of their income is derived from live performance fees. This is an income stream that performers can budget for, control, and get paid for at the end of the night.

Performance income comes with significant expenses attached, and it is not unusual for tour expenses to exceed income. The case studies illustrate how tour expenses are not scalable; the more active a band becomes, the more money spent on travel, sidemen, and promotion. Yet, performance income remains the key revenue source for many performers. Other roles that these case study artists play, such as teaching and sideman work, appear much more stable in the sense that they have fewer expenses attached.

Label advances and grants are not free money. Two of the case study artists have received significant grants or advances related to recording projects. In both cases, all of the money was spent to make their records. And, in some cases, the records cost more than the advances or grants may provide, meaning that artists often need to invest income earned through other means to complete the recording project.

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