How booking agents use (and don't use) data
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View this email in your browser (|ARCHIVE|) http://hotpodnews.com/presents.... The fine print of innovation in the music business. This is issue #77, published on February 7, 2020. Happy Friday!
No major intro this time around. For this week’s stories, I tried to offer a diverse mix of perspectives from across the music industry, including: 1. A deep-dive on booking agents’ relationships with data; 2. A breakdown and contextualization of all the latest music-streaming user statistics, and 3. A new framework for rethinking power in the music business at large.
Hope you enjoy, and as always feel free to reply directly to this email with any feedback or questions you have! Thanks so much for reading. :)
- Cherie How booking agents use (and don’t use) data
For all the buzz about the live music industry — from its multibillion-dollar market size (https://www.billboard.com/articles/business/touring/8530894/ticket-sales-25-billion–study) , to its increasingly influential role (https://thecreativeindependent.com/music-industry-report/) in artists’ careers — there’s surprisingly little discussion about the people who make sure artists get to play these shows in the first place: booking agents.
As a quick primer: In music, booking agents work on behalf of artists to find and negotiate deals for live performances and appearances, and often play a hands-on role in building said artists’ long-term touring careers. Increasingly, they also help secure crossover partnerships between music and other entertainment industries, such as Marshmello’s show in Fortnite (https://variety.com/2019/gaming/features/uta-esports-influencers-1203223400/) .
Typically, artists pay their agents a 10% to 15% commission on gross revenue from each show or appearance they book. The legal fine print of these arrangements is beyond the scope of this article, and has already been covered on the blogs of Heroic Academy (https://heroic.academy/understanding-music-industry-artist-managers-booking-agents/) , AWAL (https://www.awal.com/blog/how-to-find-a-booking-agent-for-musicians) , Sonicbids (https://blog.sonicbids.com/working-with-a-booking-agent-explained-by-3-pros) and other music companies.
For this article specifically, I want to hone in on something that hasn’t been examined in depth yet: How has data changed — or, more importantly, not changed — the business of being a booking agent?
While the media has spilled ample ink on how data has transformed the recording business, that same scrutiny hasn’t yet been applied to the booking side. To fill in that gap, I talked with agents at Paradigm, CAA, High Road Touring and Lost + Found about their relationships with data — and the challenges of making “data-driven” decisions in a world where, in the words of Tom Windish, “more and more artists [are] blowing up on streaming platforms who have never played a show, or never even thought about playing a show.” Click here to continue reading. (https://www.patreon.com/posts/33804326) The latest music-streaming user numbers and service differentiation: What you need to know
The last few weeks have seen an unusual deluge of announcements and user statistics flow out of the music-streaming world.
Two days ago (Feb. 5), Spotify released its Q4 2019 earnings (https://investors.spotify.com/financials/press-release-details/2020/Spotify-Technology-SA-Announces-Financial-Results-for-Fourth-Quarter-2019/default.aspx) — announcing 124 million subscribers, out of 271 million total monthly active users — and formally announced its acquisition of The Ringer (https://www.nytimes.com/2020/02/05/business/media/spotify-the-ringer-bill-simmons.html) .
Three days ago (Feb. 4), Apple Music announced an exclusive video deal (https://9to5mac.com/2020/02/04/apple-music-to-premiere-genius-verified-interview-show-that-dives-into-the-meaning-of-artists-lyrics/) with Genius, while SiriusXM also released its Q4 2019 earnings (http://investor.siriusxm.com/investor-overview/press-releases/press-release-details/2020/SiriusXM-Reports-Fourth-Quarter-and-Full-Year-2019-Results/default.aspx) — revealing that Pandora had 63.5 million monthly active users, a nearly 9% decline year-over-year, but overall annual revenue growth of 10% across both ads and subscriptions.
Four days ago (Feb. 3), Alphabet shared that YouTube Music and YouTube Premium had 20 million paying subscribers combined (https://9to5google.com/2020/02/03/youtube-premium-subscribers/) .
And 15 days ago (Jan. 22), Amazon Music made the rare move of revealing its own user numbers — “55 million customers (https://www.theverge.com/2020/1/22/21077187/amazon-music-service-55-million-customers-spotify-apple-music-prime-members) ,” to be specific, across Amazon Music Unlimited, Amazon Prime Music and its recently-launched free tier (https://www.theverge.com/2019/11/18/20971413/amazon-music-free-streaming-ads-iphone-android-fire-tv) .
This is a lot of data that can be difficult to digest all at once. I thought it would be useful to contextualize all of these new user stats within wider music-tech trends, and to offer my input on the key moves to watch that could impact their growth and differentiation of these companies in the near future. Click here to continue reading. (https://www.patreon.com/posts/33747301) ICYMI: The Music Business Rectangle — A new framework for rethinking power in the music industry I came up with the above diagram for understanding power in the music industry last month, but wanted to bring it back today as I think it’s relevant to a lot of developments that have happened since, including but not limited to Downtown’s acquisition of FUGA and Spotify’s acquisition of The Ringer.
Shortly before the 2019 winter holiday break, I ran a poll on Twitter (https://twitter.com/cheriehu42/status/1207055397464481792) asking whom my followers thought “ran” the music industry — i.e. who had the most power, influence and control in deciding where the music industry was going, from a commercial and technological perspective. Unsurprisingly, the top two choices in the poll were labels/publishers and tech conglomerates.
But after some more reflection, and after reading through everyone’s comments on the poll, I realized that trying to understand the question of power through the lens of organizations might be a lost cause in the modern music landscape, as traditional boundaries among different kinds of music companies are continually blurring (https://www.rollingstone.com/music/music-features/every-music-company-is-morphing-into-the-same-thing-811329/) . Management and tech companies are becoming record labels, record labels and distributors are becoming managers, gaming companies are becoming event promoters — the list goes on.
Instead, we need a better framework for understanding power in music that is not confined to traditional organizational structures, but rather centers around more adaptable and transferable business concepts.
In particular, as illustrated above, I think the most powerful players in the music business aren’t specific companies, like labels, publishers or private equity firms. Instead, the most powerful players in the music business have the most robust combination of the following four competitive advantages: capital to invest, long-term intellectual property assets, direct-to-audience scale and direct-to-talent scale.
What’s more, virtually no music company in the world has all four of these advantages. The few, rare ones who do will end up running the rest of the industry. Click here to continue reading (members only). (https://www.patreon.com/posts/32874076) Good reads
The branding genius of K-pop band BTS (The Washington Post) (https://www.washingtonpost.com/business/2020/01/30/bts-kpop-bighitentertainment/) At large, K-pop ticket sales, music downloads and merchandise accounted for 0.3% of South Korea’s entire GDP last year — a dollar amount of $4.65 billion. In this piece, Marian Liu dives into the merchandising, ecommerce and branding strategy behind one of K-pop’s most well-known groups, BTS, with perspectives from the group’s record label Big Hit as well as outside brands like Mattel.
What 2019 album releases can teach us about 2020 planning (Deep Cuts) (https://medium.com/@AmberHorsburgh/what-2019-album-releases-can-teach-us-about-2020-planning-1092554c019a) Amber Horsburgh analyzed nearly 700 different album campaigns from 2019 to determine which were the best (and worst) weeks to release an album last year — and what those findings reveal about the power of leveraging specific cultural moments to maximize awareness and consumption around a new project.
How the Plight of Beleaguered Label Tiny Engines Could Bring New Solutions to Indie Rock (Billboard) (https://www.billboard.com/articles/business/record-labels/8549643/tiny-engines-adult-mom-interview-indie-labels) Being an indie artist is hard. Running an indie label is also hard. Being transparent about how an indie label runs… shouldn’t be hard. But as Chris Payne writes, recent accounting and payment troubles around Tiny Engines (https://www.tinyengines.net/) underscores systemic, previously unspoken infrastructural challenges for indie labels across the board that could potentially be solved via better software. The kicker of the piece, from Infinite Aggregate (https://infiniteaggregate.com/) co-owner/operator Hunter Giles, says tons about the state of labels today: “When most people start a record label, they don’t realize that they’re starting a marketing and accounting firm that specializes in music. But that’s what a record label is.”
1,000 True Fans? Try 100 (Andreessen Horowitz) (https://a16z.com/2020/02/06/100-true-fans/) Excellent adaptation of Kevin Kelly’s “1,000 true fans (https://kk.org/thetechnium/1000-true-fans/) ” theory, from Andreessen Horowitz partner Li Jin: “I believe that creators need to amass only 100 True Fans—not 1,000—paying them $1,000 a year, not $100. Today, creators can effectively make more money off fewer fans.” It’s a compelling argument that is somewhat backed by evidence, with the number of creators earning thousands of dollars a month on platforms like Patreon, Podia and Teachable increasing every year. Jin also goes into detail about how a creator’s product and service offerings to fans/customers need to change in order to make the “100 true fans” theory really work. What I’m listening to
I’m doing Gary Suarez (https://twitter.com/noyokono) ‘s Music Writer Exercise (MWE) this month, in which every day I listen to one album I haven’t heard before and then write a tweet about it.
Here are the albums I’ve gone through so far: * Blue Lab Beats (https://open.spotify.com/artist/4YLUMAgNyttwx4hUHgtBtR?si=yqq0xVWiQ8yrnzvZLamOwg) — Voyage (https://open.spotify.com/album/7HJsSTwN00gpsuVEVNwK0P?si=QbgDTbEoTfWsb5X2wq1L6w) * Sinead Harnett (https://open.spotify.com/artist/6tUJpYN2aYiXbzAcg0pIOo?si=p8RmMvadS6qlsLu39a45eQ) — Lessons in Love (https://open.spotify.com/album/17MS1oITaC8VbYmtpXplMV?si=8rxP6k1WSTKniG3X2isbPg) * Sudan Archives (https://open.spotify.com/artist/2MPHBxznH1fj59jbOWY38u?si=gxmjzQLkRFKF8C4u7-4jrA) — Athena (https://open.spotify.com/album/4HOPqliDYxpuwdsRwXwpOJ?si=9TIdTAx_Q_my2blENSqM4w) * 100 gecs (https://open.spotify.com/artist/6PfSUFtkMVoDkx4MQkzOi3?si=3OkN1m3-TH6XvNsEnes_yg) — 1000 gecs (https://open.spotify.com/album/2uhB1KivbFnlkARpbd0Cvu?si=e9t4pnq3QYiBAyms7oGphg) * Jaga Jazzist (https://open.spotify.com/artist/68HFSFMCZzyRjkkm9bv5Vt?si=rKERFrUeSvye901z9VFiLQ) — One-Armed Bandit (https://open.spotify.com/album/6Gk0nFXMulJtAle3W4vXF1?si=xK84-ikoRu6l5oJjOfGfyw) * Baby Rose (https://open.spotify.com/artist/6Z4JcgqrqgysyHIPRtDIHo?si=D7cbC2dvQYuCyhi97VBcOw) — To Myself (https://open.spotify.com/album/07PqTotv8diLUNtKwYFrxd?si=eE13XwnvT9mtb9kw5q0qIQ)
To read my tweets about them, click here (https://twitter.com/cheriehu42/status/1222926362660478978) . If you’d like to support even more thoughts and conversations on music and tech, I encourage you to become a paying member of the Water & Music ecosystem on Patreon (http://patreon.com/cheriehu?utm_campaign=Water%20%26%20Music&utm_medium=email&utm_source=Revue%20newsletter) .
For as little as $3/month or as much as $200+/month, you can access a wide range of perks including: * A closed, members-only Discord server, consisting of regular updates and analysis on the most important music and tech news * Exclusive essays and article previews * Updates on my book research * Monthly video hangouts with me
…and much more! Thanks so much for reading! ❤️
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