Selling CDs is no way to make a living
Back in the late 1980s when Jane's Addiction was in its prime, I saw an interview where front man Perry Farrell was asked about sales figures for their albums. His response: "If I wanted to sell records, I'd work in a record store." He knew that the key to success was touring, which the band did almost incessantly for about three years.
Once upon a time, there were these things called record stores...
(Credit: Mike Dillon, via Wikimedia Commons)Flash forward 20 years, and it's harder than ever for artists to make a living selling CDs. According to a report in the Chicago Tribune, a speaker at the Future of Music Coalition gave a breakdown of album numbers that will be particularly shocking to young independent bands who hoped they'd be able to make a living selling discs. More than 115,000 new albums were released in the U.S. last year. Of those, 110 sold more than 250,000 copies in the U.S. last year--that's not such a surprise, as big stars have always been rare. But only 1,500 titles cracked the 10,000 mark, and fewer than 6,000 sold a paltry 1,000 copies.
To give you some idea what 1,000 copies means, that used to be the standard manufacturing run for self-produced CDs. Indie bands imagined that they would use a hundred or so discs for publicity--sending them to radio stations and reviewers, for instance--and then sell the rest to local fans and on tour. Selling 900 CDs at $12 a pop would gross almost $11,000, which would be enough to cover low-budget recording and manufacturing expenses and perhaps buy some new guitar pedals and drumheads. Nobody makes a living selling 1,000 CDs. (Nowadays, bands can order reasonably priced smaller runs from companies like Disc Makers, and even use manufacturing-on-demand from services like Audiolife and Amazon's CreateSpace.)
What about 10,000 discs? If you're just starting out, making over $100,000 from CD sales sounds like a dream. Of course, you have to split that money among the band members, and anybody else who gets a cut, like the producer and manager. And if you're signed to a label, you might already be that deep into the hole for your advance and recording expenses, so forget about royalties and just hope they'll pay you an advance for the next one. At 10,000 copies, you're probably getting a little radio play somewhere, so you might earn a few small paychecks from publishing royalties, and if you've got a good live act and are willing to tour endlessly, you might be able to sell more tickets than CDs over the course of a year. So perhaps 10,000 is the low-end baseline for making a living playing music.
Of the new titles released last year, almost 99 percent of them didn't sell enough copies to let their creators earn a living from CD sales, and almost 95 percent of them didn't sell enough copies to cover the most basic expenses involved in their recording.
You still think your unsigned band's good enough to be in that slim line? Remember that these figures include CDs released by well-established artists like Bob Dylan and new artists who are the lucky recipients of massive publicity pushes by major labels.
For an unknown band just starting out? Better polish those chops and gas up the van, then get ready to live on ramen noodles for a couple years. And don't worry about devaluing your recordings by selling them cheap or giving them away--worry about getting enough fans to hear them so they'll be interested in coming to your shows, and dragging a few friends with them.
Matt Rosoff is an analyst with Directions on Microsoft, where he covers Microsoft's consumer products and corporate news. He's written about the technology industry since 1995, and reviewed the first Rio MP3 player for CNET.com in 1998. He is a member of the CNET Blog Network. Disclosure. You can follow Matt on Twitter @mattrosoff. 
I'm reasonably sure that each decade saw similar proportions (and the '70s likely worse) of bands trying to make a living off of music, getting nowhere fast, and eventually getting day jobs.
Most new bands make their living off of local club gigs at best, where they don't have to drive far, and can get back home in time to get to work (day job) in the morning. Barring the occasional pre-manufactured Label band, the vast majority of them probably do it just because they enjoy the hell out of it (you'd have to - it would kill you otherwise), whether they hit it big or not.
I buy all my CD's used anyway, which means I spent nowhere near $15 unless it was a special import, or a rare release that even the music stores didn't have anymore.
I'm curious now...
In baseball, if you get signed by the Yankees as a pitcher and you don't win games, they cut you.
In the music industry, if you get signed and don't sell music, they cut off your arm.
Nice business.
Make it easy to buy music and offer users a unique experience. I like getting great artwork and videos with my purchase. People will legally purchase music if you make it easy and offer them an enjoyable experience and offer them extras such as added artwork. Find ways for users to discover new music, such as streaming, and offer users one click purchases. Things are getting better now that DRM is gone but buying music is still a pain in some instances and discovering new music is really hard.
Touring is not the only thing and in the industry, it only pays for the least important bits. The problem with the technology pundits is you are wannabes. You wannabe cool. You wannabe loved. You wannabe sexy. The fact is the music is what matters and CDs while not a way to make a living are one piece of the technologies that make music last and travel.
The live gig is the experience. The recording is the proof. Unless you have the spine and the talent to write and record, you're a weekend warrior with a Microsoft badge. It ain't nothing but it ain't pudding.
still got 700+ of these bad boys if you like heavy rock: asimplecomplex.com
Also love the "Tower Records" pic.
Q3 2009 sales: http://colortheory.com/sales-q3-2009
Profit/loss figures for each album: http://colortheory.com/accounting
I'm not going to quit my day job anytime soon!
Brian Hazard
Color Theory
- by SteveW928 October 9, 2009 12:28 PM PDT
- I think there are some problems with these stats though...
- Like this Reply to this comment
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(16 Comments)1) they don't include stuff like iTunes sales
2) they are album based, not track based
It might tell a similar story... but I'd like to see the stats analyzed based on the above two trends.... track rather than album, and including digital distribution (which I think has surpassed physical copies).