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Business News Labels & Publishers
Non-record sale revenues now account for fifth of UK record industry’s turnover
By CMU Editorial | Published on Friday 5 October 2012
So called ‘diversified revenues’ accounted for a fifth of the UK record industry’s turnover in 2011, according to the new stats from record label trade body the BPI. Diversified revenues are monies made from anything other than CD/DVD sales and download and streaming platforms.
Such revenues are growing, of course, as labels demand a cut of revenue streams other than those directly linked to sound recordings when signing especially new talent to record deals, better safeguarding their investment as the money to be made from record sales continue to decline overall, despite the boom in downloading and the recent growth of subscription-based streaming platforms.
That said, about half of the £205.3 million generated by the UK record industry via so called ‘diversified’ revenue streams in 2011 (up 8.4% from £189.3 million in 2010) was directly linked to sound recordings, and came from income streams that have traditionally been part of the record label mix, even if they have become ever more important and sizable in recent years.
£83.2 million came from collecting society PPL from the royalties paid by TV, radio, online broadcasters, clubs, venues, bars, retail and other public space operators for their use of recorded music. And £18 million was generated by sync deals, an increasingly important part of the music rights industry, but not exactly new.
More interesting, of course, was the £76 million generated by labels from their cut of concert, merchandise, brand partnership and direct-to-fan revenues from artists with whom they have multi-stream, or so called ‘360 degree’, deals. Labels enjoying a share of such revenues, while not 100% new, is certainly much more prevalent in the post-Napster age, and indeed some labels now will not sign deals with new talent that don’t include such extra revenue.
Commenting on the figures, BPI boss Geoff Taylor told CMU: “British music companies have reinvented their businesses for the digital age, marketing and promoting music intelligently through every channel available. They have diversified their revenue base and this has established a solid platform for future growth as the transition to a majority digital business continues”.
