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Live music worth more than the record industry
By CMU Editorial | Published on Tuesday 17 March 2009
So, the headline voxpop to come out of this weekend’s International Live Music Conference in London, the big bash for the live music sector, was the claim that the UK’s live industry is now bigger than the UK’s record industry in terms of revenue. The stand out voxpop was delivered by the chief stats man at PRS For Music, Will Page, who sat on a realtively optimistic panel give the title of their debate was ‘The Recession Session’.
PRS For Music, of course, have privileged access to some key live music stats because promoters have to pay a licence fee to the collecting society every time (well, in theory every time) an act at one of their shows sings a song owned by one of the songwriters and/or publishers PRS represents.
According to the BBC, Page told the event: “We’ve been doing some maths back at the office. We have all the data on live music at the PRS because we license all the live performances that go around the country, so we’re actually able to put a number on how much live music is worth. And we found that recorded music’s share of consumers’ disposable income was going down, while the share for live music was going up”.
Page estimates that live music in 2008 was worth about £904 million, while according to the BPI the trade value of the record industry was £896 million. And while the retail value of recorded music was an estimated £1,240 million, Page says that if you add in secondary ticketing mark ups (based in part on Tixdaq data) and other ancillary revenues in the live sector, he reckons it was worth £1,280 million overall.
Those figures do seem to back up the held-for-a-few-years-now opinion in some parts of the music industry that live is where it’s at, and that the record industry is in a state of terminal decline – record companies have secured their decades of investments on the wrong thing, and new artists shouldn’t worry about fans stealing their recordings, they’ll make their cash through ticket sales.
Certainly the mainstream live industry has boomed in the last fifteen years, aided by the revival of rock at the turn of the century, the gentrification of the music festival, the happy fact music sponsorship money tends to be channelled more towards live than recorded music, and, for venue owners, the undeniable truth that while music fans can be fickle when it comes to buying records, they’ll always buy beer.
Though, of course, revenues are all well and good, but what about profits? The cost of producing live music events, and running music venues, is always on the up, whereas the cost of producing, distributing and marketing recordings is falling, and will do so even more so if and when digital becomes the primary way of releasing music.
And profits are important – not just for the fat cats at the top and their shareholders – but because without the profits there is no money to invest in new artists. As it stands it’s still record companies who generally make that initial investment, even though the value of what they sell is falling. In theory live music firms, if they are the future, could make those initial investments, though they’d need not only the inclination to do so, but a sufficient profit margin on those billion pound plus revenues to enable them to spend. I’m not sure that either the inclination or the profit margins are there just yet.
And anyway, if you’re trying to decide which bit of the music business you should be dabbling in right now, remember the reason Page enjoys an insight into the fortunes of both the record and live industries. The publishers earn from both. So I think it’s fair to say, music publishing is still the safest bet for the time being. Well, until Google take over the world it is.
