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Live Music Makes The $$

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Is the statement that concerts are more lucrative for performers really news to anyone?

The concert business has never been bigger, in dissonant contrast to the recorded-music business. While music sales have dropped for three years in a row, from $13 billion to $11.5 billion in 2002, hurt by Napster-style digital piracy and a lackluster flow of hot new acts, the tour business has climbed for four years straight, from $1.3 billion in 1998 to $2.1 billion last year. Thus musicians increasingly rely on road shows for their income.

Performers frequently moan about never seeing a royalty check from their record label, no matter how many discs they sell. But a top concert draw can take home 35 percent of the night’s gate and up to 50 percent of the dollar flow from merchandise sold at the show. The labels get none of it.

“The top 10 percent of artists make money selling records. The rest go on tour,” says Scott Welch, who manages singers Alanis Morissette and LeAnn Rimes.

Another thing that’s no surprise to anyone:

Now the music labels, hungry for revenue from any source, are mulling over whether to make a grab for a piece of the tour biz. One company already has: In October EMI Recorded Music signed a deal with Brit singer Robbie Williams that gives the label a cut of the pop star’s merchandise, publishing, touring revenue and sponsorship.

EMI officials say they are pursuing similar deals with other musicians, both superstars and new acts. Other label executives are eyeing the idea, albeit less openly. Vivendi’s Island Def Jam may create a tour division. At Sony Music, before he left the top job earlier this year, the embattled Tommy Mottola is said to have asked several top acts to share the wealth; they demurred.

For many years, the label would “pay” for the tours, thus deducting the expenses from the performer’s album royalties. Now, when the performers are making money by touring at their own expense and reaping the benefits of the gate and merchandise. Of course the labels, crying poverty over $2 billion in lost revenue (due mostly to shitty products swamping the markets, NOT P2P sharing) want a slice of that pie, too.

It’s not enough that the medevial screwing of the acts and the consumers has continued and they’ve refused to move into the 21st century, they also want a slice of something that they’ve traditionally used to jack the performers out of more money because it’s lucrative right now.

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About Jim Schwab

  • The Theory

    labels getting money from tours might work for big bands like U2, however,with band’s main income from music coming from the tour, even many major bands couldn’t afford to spit the money pie from concerts another additonal direction.

    peace.