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Music's New Math

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4. Who’s Making What?
Here’s what three hypothetical artists of different sizes might be pulling down for each album they make, based on musician interviews and industry gossip.

The DIY BandFive unknowns with a borrowed station wagon. Record an album every five years.

Revenue	Breakdown	Quantity	Total
CD sales	$8 per CD (after production costs)	500	$4,000
iTunes and other downloading services	$.65 per $.99 download (after service takes a cut)	200	$130
Spotify and other streaming services	About $0.005 per stream	200	$1
Merch	$100 per show (twelve T-shirts at $10 each, after printing costs)	45 shows	$4,500
Tour	$50 per night (Plus free beer, maybe)	45 shows	$2,250
			$10,881 (Or about $435 per member per year)

The Indie Four-PieceBeloved by Pitchfork and signed to a small label. Record a new album every three years.

Revenue	Breakdown	Quantity	Total
CD sales	$2 per CD (after the record label and others take a cut)	125,000	$250,000
iTunes and other digital downloads	$.25 per $.99 download (after the service, label, and others take a cut)	125,000	$31,250
Spotify and other streaming services	About $0.005 per stream	20,000	$100
Commercial licensing	$100,000 for placement in a cell-phone commercial	1	$100,000
Film licensing	$5,000 to soundtrack an indie movie	1	$5,000
TV licensing	$10,000 to soundtrack a teen cable drama	1	$10,000
Merch	$4,000 per show (250 T-shirts at $20 each, less printing costs)	30 shows	$120,000
Tour	$15,000 per show (2,000 tickets at $30 apiece, less touring expenses)	30 shows	$450,000
			$966,350 (Or about $126K per member per year)

The Major-Label ActSolo artist bigger than Beyoncé. Releases an album every two years (with remixed deluxe editions in between).

Revenue	Breakdown	Quantity	Total
CD Sales	$2 per CD (after the label takes a cut)	4 million	$8,000,000
iTunes and other digital downloads	$.25 per $1.29 download (after the service, label, and others take a cut)	5 million	$1,250,000
Spotify and other streaming services	About $0.005 per stream	130 million	$650,000
Radio royalties	$800,000 per single	2	$1,600,000
Commercial	$300,000 for placement in a beer ad	1	$300,000
Film licensing	$20,000 to soundtrack a summer blockbuster	1	$20,000
TV licensing	$50,000 to soundtrack a network crime procedural	1	$50,000
Merch	$300,000 (many many T-shirts in a 20,000-venue)	20 shows	$6,000,000
Tour	$600,000 per show (Selling out arenas)	20 shows	$12,000,000
Endorsements	$3,000,000 for zit cream commercials	1	$3,000,000
			$32,870,000

All numbers are hypotheticals based on industry research and interviews. Each record company makes specific and unique arrangements with artists and music distributors.