1. The Music Business System Chapter Three

2. What is your particular area of interest/talent in the music industry?
Start Thinking . . .
What areas of expertise and kinds of resources are required to get a song to market?
What is your particular area of interest/talent in the music industry?
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

3. Chapter Goals
Understand that the music business is a system composed of subsystems, each of which submits to rational analysis.
Learn how a song gets through “the maze”—how it travels through the system to the bank.
Grasp the significance of the “information age” and how to deal with it today.
Appreciate that the music business has been based on the star system—that only individuals with strong talent and motivation could expect to persuade others to invest in their potential for commercial success.
Discover that performers often can’t gain or sustain success without a fully staffed support system.
Learn the four factors contributing to the success of those who “win” in the music business.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

4. Help Wanted! Transforming technology shaped the music business:
100 Years Ago: Music publisher shipped paper to retail stores countrywide.
Today: Publisher may also be part-time songwriter with all assets on a hard drive.
50 Years Ago: Record company exploited only one path to the consumer.
Today: Artist can produce and distribute music, CDs, and downloads at home.
30 Years Ago: Performance of large ensemble required many musicians.
Today: One or two musicians and an MIDI controller can provide similar performance.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

5. Help Wanted! To economists, trend = increased productivity
To old guard, trend = loss of jobs + traumatized investors
But change also = opportunity
Human talent is still the key behind the music industry
Aspirants need opportunity plus
talent
understanding of how music business system works
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

6. Getting Through the Maze
The music industry = musician + audience
There are two convenient ways to view the music industry:
Understand the music business system and its subsystems
Understand how a song gets to market
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

7. Getting Through the Maze
[Insert Figure 3.1]
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

8. Getting Through the Maze
How a song gets to market:
The composer—who sometimes is also the performing artist—writes a song and signs with a publisher.
The publisher persuades an artist (or that artist’s producer) to record the song.
Lawyers (at several stages) negotiate contracts between parties and specify terms for varying forms of usage and exploitation, such as mechanical rights and synchronization licenses.
The record company produces a recording and, possibly, a video version of the song.
Promoters persuade programmers to broadcast the audio recording and the video.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

9. Getting Through the Maze
The record company uploads the song for online sale and ships the merchandise to distributors, who sell it to retailers.
In cases where artists retain distribution rights, artists sell music from their websites and negotiate deals directly with download and/or streaming digital platforms.
If the song becomes popular, a second wave of exploitation can occur—licensing of ringtones and merchandise connected to the song and/or artist.
A talent agency contacts promoters and books a concert tour.
Concert promoters enlist cosponsors and sell the tickets.
The road manager moves the people and the equipment.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

10. Getting Through the Maze
The concert production manager dresses the stage, lights it, reinforces the sound.
The artists perform.
The performing rights organizations collect performance royalties.
The accountants count the money; the participants pay their bills.
The government collects the taxes.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

11. Music is not simply about an artist performing a catchy tune.
Show Me the Money
Music is not simply about an artist performing a catchy tune.
The music industry has mushroomed into an interconnected series of segmented multibillion-dollar businesses, including
live concerts
sale of musical instruments and equipment
streams, downloads, physical recordings
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

12. Show Me the Money [Insert Figure 3.2]
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

13. In times of rapid change, you need to stay informed:
Tools of the Trade
In times of rapid change, you need to stay informed:
Read the trades
Attend professional meetings
Read online music blogs
Learn from the professionals
Study at accredited institutions
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

14. Music Business Studies in Higher Education
Rapid growth of the music industry after World War II
Most people learned on the job
Growing music industry required leaders in
music
business administration
accounting
law
Pressure for curricula in music business from
students
gigging faculty
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

15. Music Business Studies in Higher Education
Music business studies in higher education was born offering the following:
Music
Business administration
Accounting
Marketing
Business law
Copyright
Recording technology
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

16. And the Winners Are . . . Four factors of “winners” in music business:
They are strongly motivated; they really want to win.
They are talented—and they surround themselves with talented associates.
They persevere; they hang in there until they succeed.
They study the business for insights on the creative process, career trajectory, and industry economics.
#1 to #3 depend on you.
#4 is offered in this course.
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners

17. For Further Thought . . .
What would you consider to be the essential factor(s) for “winning” in the music business?
Music Business Handbook and Career Guide, 11th Ed.
© 2016 Sherwood Publishing Partners