This is an interesting chart that I stole from a study published on Seatsmart, and it shows the evolution of the revenues of the music industry since 1980. In blue you see the album revenue, in decline, which is hardly a surprise, and in pink you can observe the steady increase of the tour revenue. But you know how bands always say they have to tour to compensate the fact they are not selling albums anymore? As you can see on this graph, the compensation is barely achieved. If you compare bands’ album revenue in the 80’s, today’s successful bands can hardly compensate by touring. Of course there are exceptions like U2 and I just wonder who are the other pink dots above the line, but still, no giant tour, not even the U2 360º tour, will ever achieve what Michael Jackson did with one single album, ‘Thriller’. And this sums up the giant malaise.
In average, the numbers in tour revenue are up just over 50% over three and a half decades, but album sales are down by 84%. So this is bad news for musicians. And what is the most amazing thing? Album revenues were down before the internet came into play, if you look at the graph , there was a decline since the 80’s and 90’s! We can think the internet accelerated the process but what is the origin of this phenomenon?
The same study also compared ticket sales versus album sales and this reveals something even more worrisome. Album sales and ticket sales are both decreasing, album sales declining just a bit faster. So in fact the biggest revenue in tour sales previously reported is due to much higher prices per ticket… surprised? You should not if you have attended concerts for many years, as a matter of fact, I tend to think concert ticket prices are on the constant rise as an attempt to precisely compensate for low album revenues. Plus CDs are so cheap now that these numbers are easy to understand.
So what can you do if you are a musician? The future is bleak, because albums do not sell anymore and tour revenues do not compensate. I was even surprised to see that this study shows a decline in concert attendance! How is this possible when some shows sell out in a few seconds? May be high prices are to blame.
The study also shows that tour revenues are sucked by just a few mammoth bands, like U2 and the Rolling Stones, as this study was only considering top acts… so unless you are a major act, you seriously have to worry for the future, and nobody is bringing a solution.