How much do artists make from different music formats?

Very wide question I'm sure...

Streaming pays notoriously badly (though it can raise profiles/brand for royalties, touring, merchandise etc), but how much do artists really make from a sale if you go and buy a CD, LP, or high-res download these days?

Factoring in retail, storage and distribution fees for physical media, and industry cuts, etc.

I use Spotify but still buy CDs and LPs for ones I really want, which (not to take any moral high ground) does also feel a bit more like supporting the artist. It's also nice to buy music straight from them where possible - eg following a concert or from ones with home-based distribution. Got to be a dying thing though.

What's the general picture?

 

I am not sure exactly what artists make, but I know a person who had a not famous band in the 1970s just for one year in Europe and he gets $30K payment from Sony every year.

 

There are no standard fees. It all depends on contracts, sales expectations, who holds the rights to the work, what distributors get, etc. No way to know from here.
But I would imagine the high sale price and non-returnable nature of vinyl mean a higher take on a copy per copy basis, though higher manufacturing costs might negate that somewhat.
I also don't know how merchandise sales works at concerts. Do venues get a cut ?

 

A lot of it depends on the site where the music is distributed. Bandcamp is pretty artist-friendly. The artist or label determines the price, and Bandcamp takes 15% off the top, leaving the rest for the artist/label (Paypal fees also come out of the artist's portion).

CD Baby is also another platform that is artist-friendly. They take 9% for streaming or downloads, and charge a flat $4 fee for physical media.

There is a wide range of variables when it comes to how much an artist takes home from each CD or LP sale: studio cost (including the recording, mixing and mastering), physical reproduction and how many units are being processed (smaller runs have a higher production cost per unit), and any distribution or publicity that an artist might pay for. There's another range of variables if there is a label involved. The label might front the cost of everything, and the artist pays back the label from sales. They could also split the cost. The artist might also purchase physical product from the label at a pre-determined wholesale cost, sell it at retail and pocket the difference.

Here's one example from a band I'm in (an acoustic trio with guitar, fiddle, and percussion). On our last self-released recording we paid about $1200 for recording and mixing. We tend to record everything live in the studio with an occasional overdub of a harmony vocal), so we are usually able to get what we need in a couple of takes and not spend a lot of time recording. We recorded 10 songs. We also spent about $1200 on the mastering, which included the cutting of a lacquer for vinyl reproduction. We had 1000 CDs printed with full color jackets at a cost of around $800. We sell the CDs for $10, so we clear about $6.80 from each disc we sell. For the vinyl we partnered with a small label that is run out of a local record shop. They fronted the cost of the vinyl production and we paid them back from vinyl sales. I forget what the exact breakdown was for 300 records, but I think it was around $7 a disc for production, and the vinyl sells for $15. We also like having our stuff available at the local music stores in the area, so we either sell on consignment or the store pays us a wholesale price (maybe 60% of retail).

Long story short, I think it's always good to buy from the artist directly whenever possible, either at a show, via their website or from their Bandcamp site. Some venues or musical festivals do charge a percentage of merchandise sales (usually in the neighborhood of 10% to 15%).

 

I remember reading that back in the CD days, a really high-profile artist like Rolling Stones would make about $1/CD but that a run-of-the-mill one could make as little as 10 cents, depending on the contract!

 

I think that it works on a percentage basis for most artists. If they have a contract with a label, then that determines what they make, whether it is a fixed amount per item ($1 a CD or whatever), it boils down to a percentage of the production cost, plus royalty. Artists earn royalty just from airplay or streaming, no media sales are required. My best guess is that labels were really making their best money when CD sales started to grow and the prices were really high for those. The higher the sales price and the lower the production costs, the more margin there is left for profit and for royalties and distributions, so it may have trickled down to artists then as well. Now, the CD is relatively cheap, so that train has left the station. Lp costs for production are much higher and I suspect that at the time the CD was popular, and even after "file sharing" and streaming pretty much killed it, that the label would require the artist to pay for Lp production if they wanted that, as it would have meant lower profit for the label. Today, with the resurgence in Lp popularity, it would be foolish for labels to not automatically go to the Lp for the popular bands with adults. That gives them a lock on that small segment of the market as the only way to get that format is through them. Younger audiences will still stream as they can't afford the Lp and associated equipment. So royalties become a huge factor for artists now as the media sales are so limited.

-Bill

 

Nice!

 

Really interesting to hear it explained like that - thanks for sharing.

Bandcamp and CD Baby look great. I' d heard of them but never properly looked; nor realised they were driven by being artist-friendly. Feel somewhat ashamed for that!

Do you stream also?

 

Years ago, I read an article that stated the artist cut (generally) on a then £13.99 CD was £1.

Or just over 7%.

 

I think my band makes the most profit from our CDs. They cost about £1 per unit and we sell them for £10. After that, downloads through bandcamp, followed by vinyl (£3 per unit, sell for £12). Vinyl requires a higher upfront investment and P&P materials are more expensive than CD padded envelopes.

 

How is it that Bandcamp downloads gets you less than CD sales ? Is their cut that high ?

 

He is marking up his physical media a bit too high IMO. That results in more profit per disc, but also probably lower sales figures overall. Definitely less exposure for the band when lower numbers of media are distributed.
-Bill

 

We sell the Bandcamp downloads at a discount. Their cut is very reasonable

 

£10 is standard for a new CD. £12 is cheap for a new LP. Everything we've released has sold out thanks.

 

Right, makes sense !

 

Interesting info Robert C and others - ta.

It's good that some are still buying physical media (and see the queues for RSD), and there is some profit to be had in that regard, but just how hard is it for small to medium-scale (sale) artists to make a living from it compared to say 20 years ago, and where will it be in another 20 when let's assume physical media has reduced further? Fingers crossed artist-supporting platforms develop to suit it.