Unit: The Music Industry

1. A Brief History1
Firstly, the live music industry has always existed so long as there have been
gatherings of people to watch musicians perform in exchange for money or value.
Being a musician and delivering music to listeners, for hundreds of years have been
one and the same.

However, in the 1600s, printed music was used by the Church for liturgical reasons.
Religious music had always propagated through Monks and Priests educated
enough to transcribe their music and hymns, but it was only in the 1800’s that the
industrial revolution paved the way for a more structured delivery of music to a wider
audience. With venues of the time, including stately homes, theatres and concert
halls demanding the latest compositions to give to their in-house orchestras for their
audience to enjoy. Baroque, Classical and Romantic compositions took the lead with
the delivery of sheet music; mainly because there was money behind this style which
was enjoyed by aristocracy, leaving folk music trailing behind and being delivered
more by word-of-mouth. When many different orchestras were able to play the
compositions of a few composers as a result of sheet music distributed to them, the
music publishing industry was created. By the late 1800s, composers could write
works that would be sold on paper to hundreds of localised orchestras and the
printing industry was thriving.

In 1857, Leon Scott made his first audio analysis tool that could record on a piece of
paper the audio input it received. Then, in 1877, Thomas Edison, created a machine
called a phonograph that could both record and playback audio instantly using a thin
metal cylinder. Through the 1880s to 1900s many formats were developed involving
cylinders of tin, wax, celluloid, and disks. These were: 4 inches, 5 inches, 7 ½ inches,
10 inches, and the 12 inch record, made from shellac, a resin from the female lac
bug of India. By 1904, the 78 revolutions per minute shellac disks were able to take
around 4 and a half minutes of music recorded through ribbon microphones.

The ability to record a particular band performing a particular composition using the
sheet music for it, created the recorded music industry. This put much more focus
on the musicians themselves, away from the composers. The process by which
musicians were being recorded became more sophisticated after Les Paul, in 1948,
recorded the first sound-on-sound overdubbed, or multi-track recording, with a track
called Lover (When You’re Near Me). This showed that recordings no longer needed
to be taken live (where all musicians were in the same room playing together) and
opened up further opportunities for artistic creation through records including delays,
phasers and reverb effects.
1
Adapted from Smith, T. (2012). A Brief History of the Music Industry, and Pallota, F. (2020). The
music industry was left for dead a few years ago. Now it’s booming again.
Record labels, who brought together the composers from the publishing industry and
the musicians from the live industry, will become very profitable from the sales of
vinyl long-playing (LP) records. They would employ people to find the upcoming
talent: to put the right musician with the right song in the right studio with the right
producer or sound engineer and to release the record at the right time. These people
became known as Artist & Repertoire Representatives (or A&R reps).

After World War II, communication technology was vastly improved and the whole
world can become a global community. Improvements from morse code, where a
sound synthesiser was needed to produce the tone, were adapted by musicians to
create the first polyphonic synthesisers attached to a keyboard to create surreal and
out of this world sounds on the multi-track recordings. In the meantime, Les Paul,
already credited with inventing multi-track recording, had been frustrated with the
lack of sound coming from his guitar while playing live, and invented the single-coil
solid body guitar, the first commercial electric guitar.

All of these industry advancements fell into place through the 1960s when Elvis
Presley, Cliff Richard and The Beatles capitalised on them. Elvis was the epitome of
a musician-focused international audience delivered through record sales and
promoted through live performance. Cliff Richard developed a similar trait in the UK
market and The Beatles brought together their own songwriting, with their
performances, massive international record sales and expansive promotional live
performance touring. The Beatles marked the first mega-band to write and perform
their own songs, showing it was a viable business model.

Having caught the attention of some wealthy people who noticed the record sale
levels, the recording industry began to receive much larger investments, enabling
elaborate stage shows for promotion, manufacture of large volumes of records that
were distributed worldwide and lucrative recording contracts with talented artists.
Merchandising prospered through live events as an alternative income stream and
for many years this continued as a successful strategy. More artists, more labels,
better deals, better distribution.

Two key new recorded music formats were introduced: tape cassettes in the mid
1970s, and compact disks (CDs) in the 1990s. While this was happening, the
technological industries were advancing digital microcomputers enabling personal
computers to become widely available to the public. In this context, a new concept
known as the internet, designed as a Cold-War tool for national government
communication, became publicly available in 1990 when Tim Berners-Lee invented
the WWW web browser. Its commercial use was not allowed until 1995 when
Amazon and eBay were established.

In 1999, John Fanning, Shaun Fanning and Sean Parker released Napster. It
focused on organising all the music (mainly in .mp3 format) into one portal where the
public could search for the track they wanted and list the tracks they had. This is the
point at which intellectual property ownership became the most valuable asset of the
recorded music industry and where the lines between publishing and recording
industries were further blurred as there was no longer a tangible product to
distinguish the two.

Now there was an unregulated collection of recorded music which rendered the sales
of physical recordings useless for those that just wanted the recording and not a
physical product they could keep. “Why should I pay for an overpriced album where
most of the money does not go to the artist when I can just go online, type its track
name in and get it for free?” was the mindset.

The recorded music industry was in panic, trying to hold onto the pre-internet
strategy of album sales through their controlled stock. The internet did not have the
intellectual property right laws – in particular international legislation – for them to be
able to control the market any more. This led to attempts by recording companies to
improve intellectual property laws through case law precedents by taking individuals
to court in high profile cases. This had a knock-on effect on the publishing industry
who provided the songs to a now ever-decreasing value market, and to the live
industry, who no longer received such big budgets for touring due to a lack of return
on investment.

At the industry’s low point in 2014, music downloads via iTunes and others had been
growing for a decade, but that wasn’t nearly enough to make up for the ground loss
by the erosion of consumers buying physical media. After years of declines, the
music industry began to rebound around 2016 thanks in large part to music
streaming. In 2022, music streaming — which includes paid streaming,
ad-supported streaming and streaming radio — represented 67% of the global music
industry’s revenues. Spotify, Amazon and Apple are the main music streaming
platforms. The format’s surge in popularity makes sense since people love taking
their music with them and streaming gives consumers access to pretty much all the
music they would ever want.

Conclusion
There are three main parts to the music industry: live, publishing and recorded. They
have changed dramatically over their 150 year life and most of that change has
happened in the last 25 years. The music industry as a whole is the largest it has
ever been. It is just changing its route to market and income streams, with the
primary source being music streaming at the moment.

Reflection
Think about the 5 facts of this section that you find the most interesting ones. Discuss
why.
 2. Music Industry Roles2

● Performance & Creative

Composer/Songwriter
Conductor
Band Musician / Solo Artist
Session Musician / Accompanist
DJ
In the background:

Producer
Musical Director
Live Sound Technician
Roadie
Instrument support/tech

● Management & Promotion

Artistic Manager
Tour Manager
Financial Manager
Venue Manager
Studio Manager
Promoter
Marketing
A&R

● Recording
Engineer
Technical Manager
Tech support
Maintenance & repair
Electronics Engineer
Mastering Engineer
Plugger

● Media
Music Journalist
Blogger
TV presenter/interviewer
Radio DJ

2
Adapted from Allan, L. (2015). Jobs in the Music Industry
 Radio/TV editor
Radio/TV researcher
Radio/TV producer
Music Podcaster

● Other
App developer
Software programmer
Retail & distribution
Luthier (Instrument maker/repairer)
Music teacher/coach

To remember:

● All of these jobs need to work together to create a record, tour, TV or Radio
show etc.
● Some jobs are done by the same person e.g. one manager may do all the
managerial job roles.
● Some jobs are even removed e.g. composing at home and uploading to the
internet removes several jobs.

Class Activity
1. In pairs, choose one role you both have NO idea what is about.

2. Do a quick research to find what the role is about and write down three main
responsibilities of that role. If time allows you, try to find more information
about it: average salary, famous examples, ways of finding work, etc.

3. Share with the rest of the class in a 2 mins pitch.

 3. A Workflow - Rights and Royalties3

In the music business, artists and creators are rewarded for their talent through a
system of compensation known as music royalties. Music royalties encompass a web
of diverse types, rights, and stakeholders. It's crucial to understand the fundamental
distinction between two types of music rights: master rights and composition rights.
Master Rights are owned by recording artists and record labels, master rights
pertain to the specific expression of a composition when it's transformed into a sound
recording. Composition rights are owned by songwriters and music publishers.
Composition copyright comes into effect when a unique musical work is documented
on a tangible medium. Based on this, the royalties that artists and creators earn are:

1. Streaming Royalties.- As streaming services such as Apple Music and

Spotify dominate the music landscape, artists and recording labels receive
royalties from these platforms. The calculation involves negotiation of payout
rates, global revenue pool distribution, and proportional allocations based on
content shares.

2. Neighbouring Rights (and Royalties).- Neighbouring rights, comparable to

performance rights, provide compensation to sound recording owners for
public performances of their work. The intricacies of neighbouring rights
royalties stem from variations in local legislation, making the landscape
complex to navigate. These royalties acknowledge the valuable contribution of
recording artists and record labels to the music ecosystem.

3. Digital Performance Royalties.- Digital performance royalties are directed at

digital platforms like internet radio, satellite radio, and cable radio, reflecting
the evolving landscape of music consumption. Designated collection societies
such as SoundExchange play a central role in the distribution of these
royalties. For artists, labels, and session musicians to receive their rightful
dues, registration with these societies becomes an essential step.

4. Sync Licensing Fees.- Sync licensing fees come into play when music is
synchronised with various content types, ranging from advertisements to
movies and video games. This process necessitates securing licences from
both sound recording and composition owners. This dual requirement not only
ensures the protection of the creators' rights but also generates dual income
streams, making sync licensing a significant revenue source.

5. Public Performance Royalties.- Public performance royalties emerge from

the commercial use of music in various environments, spanning streaming
services, venues, traditional broadcasters, and more. These royalties
acknowledge the value that music brings to public spaces and establishments.

3
Adapted from Unchained Music (2023). Understanding Music Royalties
 Performance rights organisations (PROs) act as intermediaries, collecting and
distributing these royalties to songwriters, ensuring that creators are rewarded
for their creative contributions.

6. Mechanical Royalties.- Mechanical royalties come into play when

copyrighted compositions are reproduced or distributed, with digital streaming
platforms playing a substantial role in today's music landscape. The
complexities arise from the diverse modes of consumption, including
interactive streaming, on-demand downloads, and physical sales. In the US,
the Mechanical Licensing Collective (MLC), formerly the Harry Fox Agency,
serves as a crucial entity in this process to collect the mechanical royalty,
facilitating the fair collection and distribution of mechanical royalties.

7. Print Music Royalties.- Sheet music royalties represent payments earned by

composers and songwriters for the authorised use of their musical
compositions in printed or digital sheet music. These royalties extend support
to creators and their artistic contributions, ensuring that their work is fairly
compensated across various contexts, from live performances to educational
settings. Through these royalties, the value of musical compositions is
acknowledged and celebrated.

So, who gets the money for these royalties? Here the answer:

The Recording Artist and Record Label.- Recording artists earn a share of master
royalties, along with record labels. These royalties encompass streaming royalties
from streaming services, neighbouring rights, digital performance, and sync licensing
fees. Labels often invest in marketing and production, influencing their share in future
royalties.

Distributors.- Distributors facilitate music placement on streaming platforms,

promoting visibility and collecting streaming royalties on behalf of an independent
artists and record label. They don't engage in sync fees or neighbouring royalties,
focusing solely on the streaming side of the industry.

Licensing Companies and Sync Agencies.- These intermediaries bridge the gap
between composition and master rights holders, facilitating sync placements and
earning a cut from sync licensing fees.

Songwriters and Publishers.- Songwriters own the composition and receive

performance, mechanical, and sync royalties. Publishers share in these royalties,
offering administrative and promotional services in exchange for a percentage cut.

Performance Rights Organizations (PROs).- PROs collect performance royalties

and neighbouring royalties on behalf of songwriters and publishers. They work in
partnership networks, ensuring proper royalty distribution based on usage data.
 4. The Final Project
a) In groups of 4, choose one of the following projects to present in class:

Option 1: Production your own podcast.-

Produce a 5-10 mins podcast with a storytelling element, at least one
interview, and music layers. You can find royalty-free music and sound effects
on Bensound and Freesound, or you can edit your own beats from the
Mixcraft library. Ask your teacher for a Podcast Planning Form.

Option 2: Design your own music e-magazine.-

Create a 6-10 pages music magazine, with at least three different articles: a
live event review, a local artist biography, and one section of reviews of
singles, albums or videoclips. Make sure to include pictures, and decide the
name of the magazine and a logo, as well as paying attention to the layout of
the whole e-magazine.

Option 3: Open proposal.-

Feel free to propose your own project. The only requirement: it has to be
related to the music industry somehow.

b) Choose your option and brainstorm ideas about what the content will be.

c) Plan, develop and execute your project keeping a 4 weeks planning record
(see the tables in the following pages). Complete each table in the
corresponding week and submit them with the final submission of the project.
The tables need to be submitted individually (each member of the group
needs to do their own). Final submission is due in week 8 (in 4 weeks).
 Project Weekly Planning (individual)

Group Name Week 4 (dates):

Project’s Name

Tasks to begin this week:

Tasks in progress:

Urgent issues:

Self assessment and comments:

 Project Weekly Planning (individual)

Group Name Week 5 (dates):

Project’s Name

Tasks to begin this week:

Tasks in progress:

Urgent issues:

Self assessment and comments:

 Project Weekly Planning

Group Name Week 6 (dates):

Project’s Name

Tasks to begin this week:

Tasks in progress:

Urgent issues:

Self assessment and comments:

 Project Weekly Planning (individual)

Group Name Week 7 (dates):

Project’s Name

Tasks to begin this week:

Tasks in progress:

Urgent issues:

Self assessment and comments: