This document discusses various aspects of the digital music industry including revenue streams, subscription services, cloud storage, and the changing business models. It provides data on digital music sales and streaming revenues. It also offers advice on tools and online presences that can help people navigate different career paths in the music industry.

1. Pie Charts

2. Pie Charts

3. Is The Music Biz Broken?
• What are the advantages now vs. 10 years ago?
• What are the pain points?
• Who benefits?
• Who suffers?
• Should anyone care?

4. College Students
2015
Answer Choices Response
iTunes 63.73%
AmazonMp3 5.39%
Google Play 2.94%
I don't buy digital music 36.76%
2014
Answer Choices Response
iTunes 68.37%
AmazonMp3 3.57%
Google Play 1.53%
I don't buy digital music 26.53%
Total Respondents: 204 Source: thetrichordist.com

5. 42 Ways to Make Money
SONGWRITER & COMPOSER REVENUE
1. Publisher advance
2. Mechanical Royalties
3. Commissions
4. Public Performance (PRO) Royalties
5. Composing Original Works for Broadcast
6. Synch Licenses
7. Sheet Music Sales
8. Ringtones Revenue
9. ASCAPlus Awards Program
10. Publisher Settlement
PERFORMER & RECORDING ARTIST REVENUE
11. Salary as Member of Orchestra or Ensemble
12. Shows/Performance Fees
13. Record Label Advance
14. Record Label Support
15. Retail Sales
16. Digital Sales
17. Sales at Shows
18. Interactive Service Payments
19. Digital Performance Royalties
20. AARC Royalties
Source: Future of Music Coalition
Digital Sales

6. 42 Ways to Make Money
PERFORMER & RECORDING ARTIST REVENUE
(continued)
21. Neighboring Rights Royalties
22. AFM/Secondary Markets Fund
23. AFM/Sound Recording Special Payments
24. AFTRA Contingent Scale
25. Label Settlements
Session Musician Revenue
26. Session Musician/Sideman Fees for Studio Work
27. Session Musician/Sideman Fees for Live Work
28. AFM/AFTRA Payments
TEACHING & PRODUCING
29. Music Teacher
30. Producer
31. Honoraria or Speakers Fees
Source: Future of Music Coalition
BRAND RELATED REVENUE
32. Merchandise Sales
33. Fan Club
34. YouTube Partner Program
35. Ad Revenue
36. Persona Licensing
37. Product Endorsements
38. Acting Fees

7. 42 Ways to Make Money
FAN, CORPORATE, & FOUNDATION FUNDING
39. Fan Funding
40. Sponsorship
41. Grants
OTHER
42. Arts Administrator
Source: Future of Music Coalition

8. Digital Music is Social
PEOPLE WANT TO SHARE THEIR MUSIC

9. WHO ARE YOU?
• ARTISTS
• COMPOSERS
• PRODUCERS
• MUSICIANS
• LABELS
• PUBLISHERS
• MANAGERS
• AGENTS

10. Before/After
1991 2013
• Yahoo
• Netscape
• MP3
• Napster
• Blog
• File Sharing
• Spice Girls
• Facebook
• Youtube
• Tweet
• iTunes
• Netflix
• Justin Bieber
2001
WORDS WE DIDN’T KNOW
Now…
????

11. Word Of The Decade

12. • LABELS
• PUBLISHERS
• MANAGERS
• AGENTS
• ARTISTS
• COMPOSERS
• PRODUCERS
• MUSICIANS
WHO ARE YOU?

13. Digital Music Work Flow
8
June 2013
Digital Music Report
Digital Music Value Chain
Online Radio and
Music Services
Record CompaniesDigital Aggregators
Online Download and
Retail
Mobile Music Services
Music in the Cloud
ISP Music Services
Producers / EngineersMusicians / Artists Copyright Owners
Consumer
Publishers
Multi Channel
Networks
Social Music Sites
and Services
B2B

14. Distribution Process
Direct Marketing
(optional)
Label/Artist
Activities

15. Digital Stores
HUNDREDS MORE!

16. What is the value of
music?
Situational Pricing:
Same Product…Different Prices
= $5.00
= $0.35
= $1.50
20 oz bottle
SO WHAT IS THE
VALUE OF THIS
BOTTLE OF COKE?

17. What is the value of
music?
= $0.99
= $0.30
= $.001
Warning!:
Shameless self-promotion coming up!
SO WHAT IS THE
VALUE OF THIS
SONG?

18. Revenue Streams

19. STREAMS
– Previews
– Full Length
– Free
– Ad-Supported
– Subscription
– Cloud
– Radio
Digital Revenue Streams
DOWNLOADS
– Permanent
– Tethered
– Variable Price
– Premium
– Upgrade
– Dual
– Ringtone

20. Digital Revenue Streams
DOWNLOADS
Type Price Range
Permanent $0.50 - $1.50/tk
Tethered $0.001 - $0.01/tk
Variable Price $0.10 - $0.45/tk
Premium $1.25 - $2.50/tk
Upgrade $0.25 - $0.50/tk
Dual $0.79 - $2.50/tk
Ringtone $0.00 - $3.50/tk

21. Digital Revenue Streams
SERVICE AVG PER PLAY PER 1M PLAYS
Nokia $0.07411 $74,110
Google Play $0.04573 $45,730
Xbox Music $0.03212 $32,120
Simfy $0.01626 $16,260
Napster $0.01578 $15,780
MediaNet $0.01140 $11,400
Rhapsody $0.01122 $11,220
Muve Music $0.00875 $8,750
Deezer $0.00754 $7,540
Rdio $0.00692 $6,920
Spotify $0.00521 $5,210
Youtube $0.00175 $1,750
Myspace Music $0.00094 $940
Amazon Cloud $0.00012 $120
Source: thetrichordist.com

22. Ownership vs Access
THE CLOUD STORAGE
Which is more important to you:
• Access to 30 million tracks or Owning 3000?
• Streaming or downloading?
• Privacy or Sharing?

23. Subscription Vs. Cloud
Subscription Services:
• Pandora
• Spotify
• Slacker
• Deezer
• Rhapsody
• Muve
• WiMP
• SiriusXM
• Google
• Youtube
• Beats
Cloud Services
• iTunes
• Amazon
• Google

24. Pandora vs. Spotify
Pandora
• ~1 million tracks
• Play is limited by
DCMA rules (can’t
play exactly what
you want)
• Can’t make playlists
• Not very social
• No apps
• US Only
Spotify
• 30 million tracks
• Play whatever you
want
• Easily integrated with
your social media
• Open Platform (lots of
apps)
• Offline Version (with
Premium membership)
• 23 countries
Which has more listeners??

25. Listeners vs. Subscribers
Source: http://www.digitalmusicnews.com/permalink/2013/05/26/state
24 mil “listeners
72.7 mil “listeners
Why?

26. iTunes Radio
iTunes Radio
• 20 million unique listeners in the
first month!
• That’s almost 1/3 as many users as
Pandora!
Why?

27. Which Would You Want?
Creatives
Corporate/Jobs
Consumers
$0.99 (really $0.70) $0.001/stream
X
X
X

28. $0.99 (really $0.70) $0.001/stream
X
X
X
X
What Is Your Career
Path?
Creatives
Corporate/Jobs
Consumers
ROYALTIES SALARY

29. How Do You Get There?
OLD PARADIGM
LABELS DICTATED TO CONSUMERS
“It’s really hard to design products by focus
groups. A lot of times, people don’t know
what they want until you show it to them.”
(Steve Jobs)

30. How Do You Get There?
NEW PARADIGM
CONSUMERS STEER THE SHIP
“Follow the money”
(Mark Felt aka Deep Throat)

31. NIN Story
CwF + RtB = $
Connect With Fans (CwF) + Reason To Buy
(RtB) = The Business Model ($$$$)
(Source: Michael Masnick, Editor TechDirt)
“Before anyone can pay a royalty, someone has to pay attention.”
- Ron Sobel

32. Recommended Toolkit
Recommended Toolkit:
MS Excel (2007 or newer) [1,048,576 rows vs. 65,356)
Dummies Guide to MS Excel
Good Music Business Book
“Music Publishing – The Complete Guide” (Steve Winogradsky)
“All You Need To Know About The Music Business” (Donald
Passman)
File Transfer Program or Service
Youtube/Facebook/Twitter Channel Name
Large Email Inbox
Billboard.biz (and print version)
Music Blogs (e.g., Digital Music News, Hypebot, etc.)
Paypal Account
Constant Contact or other Newsletter Program

33. A CLOSER LOOK
About Me http://about.me/stevencorn
Linked In https://www.linkedin.com/in/stevencorn
CMS http://www.cornmusicservices.com/
BFM Digital http://bfmdigital.com/
Steve's Blog http://bigfishmedia.typepad.com/thedigitallowdown/
Steve's Slideshare http://www.slideshare.net/scorn100
Twitter @digimusic4real
BFM Jazz http://www.bfmjazz.com
© 2014 Steven Corn – All Rights Reserved