pmbc making money making music

Making Money Making Music

Pacific Music Business CampJuly 2013

Presented by Keith Hatschek & Dana Myers

Who’s Who?

Dana Myers – entertainment lawyer and criminal attorney, music manager, Pacific alumni

Keith Hatschek – program director, author, producer, engineer, musician

What’s Wrong with This Graphic?

Source: Nielsen/ Soundscan

Out with the Old, In with the New

Traditional record sales are only a small part of overall MUSIC industry today

Some artists, songwriters, managers, concert promoters are all still making money – how?

Success no longer requires major corporate backing But it can be a useful add-on if done

strategically (Examples: Macklemore & Death Cab)

Why Clout Matters

What is clout?

Who has it?

Who doesn’t

How to get it

What it will allow you to do

New Models/Metrics

Amanda Palmer – Kickstarter

Jay-Z + Samsung – Instant Platinum

Justin Bieber – Beliebers “fanatic fans”

Sources of Income Live shows

Have a Billboard – BoxScore data

Recorded music

Merch

Other

Where Does the $$ Go?

Solo artist, house concert, no band, use your parent’s car – you keep 100%

That is not the norm!

Expense areas Manager Venue share Agent Attorney Sound & Lights Roadies Food, instruments, insurance, marketing, promotion,

videos, etc. What else can you think of?

Gross vs. Net

Total revenue from a gig, album, tour, or other event is called the “gross” earnings

What the artist puts in her/his pocket after all expenses have been paid is the “net”

Many artists have earned millions and been forced into bankruptcy due to poor management, under what conditions artists are eventually paid

Never be afraid to ask, “What do you expect I will net from this opportunity?”

Live Revenue Splits

Bruno Mars - $65 ticket Venue/Promoter = 38% ($24.70) Artist = 34% ($22.10) Ticketmaster = 10% ($6.50) Facility fee = 8% ($5.20) Opening act = 7% ($4.55) Taxes = 3% ($1.95)

CD Sales Split – Traditional retail

J. Cole Born Sinner - #1 on Billboard 200 this week SRLP $16.98 (consumer pays) Published Price to Dealers $12.05 (Target

pays) Price paid by Distributor $8.45 (UMGD pays) Label pays out

$1.25 to artist $1.00 to songwriters Rest goes to pay off album’s cost

to produce and market (aka “recoupment”)

Merch Madness

Survey of class – how much does stuff cost?

$__ is a great price on a concert tee!

Revenue split Sales tax withheld Venue share (for allowing you to sell it) Merch share (for bankrolling your inventory) Artist share – what you get to keep (minus

your merch table staff payroll)

Forbes 2012 Top Earners

Dr. Dre $110MM

Roger Waters $88MM

Elton John $80MM

U2 $78MM

Take That $61MM

Bon Jovi $60MM

Britney Spears $58MM

Paul McCartney $57MM

Taylor Swift $57MM

Justin Bieber $55MM

Toby Keith $55MM

What does this mean to You?

DIY Artist Model

Do-It-Yourself (DIY) Artists take control of their own careers

This means: Creative control Learning the business aspects Building relationships Learning by doing! (Make that CD, book a

show, hand paint your t-shirts, make your EPK, etc.)

DIY Benefits

You’re the boss!

You learn what works and why

What doesn’t work and how to improve

You keep any earnings (but need to reinvest)

Fun, rewarding, empowering

Music Biz Camp Goals

This week you will study and learn: Production techniques Concert production and marketing Social Media for artists PR and Marketing Copyrights and “Wrongs” – protect your music Live Sound Careers in the Music Industry

. . . And make new friends while having fun!