CMU LIBRARY

The Music Industry

Resources about the wider music industry and how the different strands fit together




INTRODUCTION

The music industry consists of people and companies that help music-makers – ie artists, songwriters, musicians, composers and record producers – to make money out of their music making. It’s as simple as that.



ARTIST REVENUE STREAMS
For frontline artists – ie those artists who directly build brands and fanbases around their music – there are a number of different ways of making money.

That includes making money from streaming and other digital services; by selling CDs and vinyl; from royalties paid when music is broadcast or played in public; by licensing music to movies, games and ads; by selling merchandise; from touring and tickets; from brand partnership deals; and through selling products, content and experiences direct-to-fan.

We can organise all the different potential revenue streams into three main groups: intellectual property revenue streams, live performance revenue streams and fan relationship revenue streams.



ORGANISING THE MUSIC INDUSTRY
Most people and companies in the music industry specialise in and focus on one of a frontline artist’s revenue streams.

So some people primarily focus on intellectual property revenue streams, some on live performance revenue streams, and some on fan relationship revenue streams. Within the first group, people also usually focus on one kind of intellectual property – eg the copyright in songs, the copyright in recordings, or the copyright in artistic works.

Therefore we can organise the music industry by revenue stream. We have the music rights industry, the live music sector and the direct-to-fan business. The music rights industry can be further split into the music publishing sector, the record industry and the merchandise business.



WHO WORKS WITH WHO
Most frontline artists will have multiple business partners at any one time, each one focused on a different revenue stream – eg a record label, a music publisher, a merchandiser, a booking agent, a promoter, and so on.

There are then other companies in the music industry that provide services to those business partners, like recording studios; music distributors; rights administrators; marketing, press, promotion and social agencies; ticket agents; tour and concert production companies; etc etc.



COLLECTING SOCIETIES
On the music rights side there are also the collecting societies that issue licences and collect royalties for artists, songwriters, record labels and music publishers in various different scenarios.

The collecting societies also perform other roles, in particular they manage the music industry’s main databases of songs and recordings. They also usually support their members and the wider music community through various educational, funding and lobbying initiatives.

The music industry has set up different collecting societies in each country. In the UK there are three societies, PRS and MCPS both work for songwiters and music publishers, PPL for artists and record labels.



ARTIST MANAGEMENT
The artist will also usually have a manager or management team – the one business partner focused on all aspects of the artist’s career.

The manager helps the artist to select and negotiate deals with the other business partners, to manage the ongoing relationships with those business partners, and to run the artist’s own company day-to-day.

Artists will also hire a lawyer to advise on deals and an accountant to manage the finances. The manager, lawyer and accountant then all work together to advise on and oversee the long term development of the artist’s business.



RESOURCES FROM CMU

This CMU:DIY Lecture provides an overview of the different music revenue streams – and the key business partners artists work with.

This CMU Trends In Ten Guide talks through the different revenue streams and business partners – and how everything fits together in more detail.

The Music Copyright Explained Guide from CMU Insights and the UK’s Intellectual Property Office provides a comprehensive beginner’s guide to how music copyright works and how music copyright makes money.

This Pathways Into Music Guide maps the career path taken by the average frontline artist, and explains when and how the music industry gets involved to help the artist grow a business around their music.



QUICK CMU LINKS

CMU:DIY Lecture: How Music-Makers Make Money

CMU Trends In Ten: Music Industry Basics

Music Copyright Explained Guide

Pathways Into Music Guide: Mapping Music Careers



EXTERNAL LINKS

UK Music brings together organisations representing artists, musicians, songwriters, record producers, labels, publishers and managers in the UK.

LIVE brings together organisations representing everyone involved in live music including promoters, agents, venues and festivals.



LAST UPDATED: July 2021