The Economics Of Adele

December 23, 2015 in Daily Bulletin

Nathan Hubbard looked at the success of Adele’s most recent album and what it says about the wider music industry:

  • 25, Adele’s latest album, sold 25 million copies in its first week, breaking the all-time record.
  • This is particularly surprising considering that a decade ago everybody thought that services like Napster would be the death of paid albums.
  • Sales were helped along by Adele’s decision to prevent the album from being aired on streaming sites, forcing fans to purchase it.
  • The album’s success has had a wider impact on the industry. Rihanna has delayed the release of her latest album given the amount of attention that 25, and even Taylor Swift’s world tour, are taking.
  • Unlike Hollywood there is no male-female pay gap in the music industry. In fact, females seem to dominate the business.
  • This puts them in a position of power over record labels, promoters, merchandizers, and many others who directly and indirectly benefit from the industry.
  • Yet the future of music seems a little bleak for the consumer. We saw with the movie business that exclusivity deals meant that the best movies were scattered among a plethora of streaming services like Netflix and Hulu.
  • Similarly you’ll likely need subscriptions to services like Spotify, Tidal, as well as the offerings of tech companies such as Apple music and Microsoft Groove, to listen to all your favourite music.
  • Things also look bleak for live performances. A ticket to Demi Lovato’s performance a year from now has a headline price of $49.95. Just as you pay for the ticket though, a $13.50 service charge is slapped on, raising the final price by 31%.
  • Venues have their hands tied. Quite often touring deals will require that artists be paid more than 100% of gross ticket revenue. Venues make their money from concessions, sponsorships, and other associated services.
  • The industry’s best hope is if musicians band together and demand a better experience for fans – perhaps after being prodded through social media.

The full article is a thoughtful analysis of the past, present, and future of the music industry. It includes musings on what the Paris terror attacks mean for musicians, and why musicians, unlike other entertainers, have found it so hard to co-ordinate. You should read it here.

Source: Medium

Via: Marginal Revolution