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Tag archive: Investing in Music (3)

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New IFPI website highlights the leading role record companies play in investing in and supporting artists

IFPI has launched a new website titled Powering the Music Ecosystem designed to showcase the role record labels play in today’s global music landscape as a leading investor in music, and partner and collaborator with artists.

Some of the key statistics referenced are the 33.8% of record company revenues that are invested back into music annually, and the USD $5.8 billion investment that record companies make into A&R and marketing annually.

The site emphasizes the flexibility artists have in collaborating with record companies within new partnership models, and charts one example of the various label teams that artists can work with to advance their career, such as A&R, creative, marketing & digital, sync & partnership, global distribution, and press & publicity.

The site also features several case studies on breakthrough artists like Camila Cabello, J Balvin, and Aya Nakamura, focused on how those artists collaborated with label teams to leverage their creativity and success on a global scale.

For more information, visit the full website and check out the infographic below.

 

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IFPI Releases Investing in Music Report

The International Federation of the Phonographic Industry (IFPI), representing the recording industry worldwide, released a new report today, Investing in Music: The Value of Labels. The report highlights the important role that labels play in the global music industry. They are the primary investors in music; record labels discover and nurture artists, produce and promote music, and connect artists with their fans.

ifpi2016report-smallAccording to the report, labels remain the largest investor in music, maintaining tens of thousands of artists on global rosters, and investing 27 percent of their revenues—US$4.5 billion—in artists around the globe. “That’s an incredible figure that reflects their commitment to artists and the future of music,” says the report. “No other segment of the music sector invests in artists on anything like this scale.”

Jointly introducing the report, Frances Moore, Chief Executive of IFPI and Alison Wenham, CEO of WIN, said: “Investing in Music highlights not just record companies’ financial investment in artists, but also the enduring value they bring to artists’ careers.  In the digital world, the nature of their work has evolved, but their core mission remains the same: discovering and breaking new artists, building their careers and bringing the best new music to fans. These are the defining qualities of record companies’ investment in music.”

Here are the key highlights of the Investing in Music report:

Music does not just happen … it requires hard work and substantial investment. Record companies are responsibly for discovering and nurturing artists, producing and promoting their music and other forms of creative output, and connecting artists with fans in new and innovative ways. According to the report, it costs somewhere between US$500,000 and US$2 million to break a new act in a major market.

Record labels are the primary investors in music. Music companies invest US$4.5 billion annually in discovering, nurturing, and promoting artists. No other segment of the music sector invests in artists on anything like this scale, and this investment has been sustained even as the music industry weathered two decades of revenue decline.

Breaking down labels’ US$4.5 billion annual investment. This significant investment is broken down into two primary areas: A&R (or artists & repertoire), which is the discovery and development of artists, and marketing campaigns which promote artists and their music.

Developing the digital market. Record companies have invested heavily in the fast-developing infrastructure of the digital market. There is a complex system of digital licensing services which requires a substantial investment from music companies to track and distribute recordings.

Unlocking new revenue streams. Record companies invest in new revenue streams, such as licensing tracks for movies and TV, giving artists that have broken through to an audience new sources of income. A record company may have as many as 200 long-term brand partnerships active on behalf of their artists at any point in time.

The full report is easily accessed on this interactive website.

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IFPI’s ‘Investing in Music’ report shows record labels invest US $4.3 Billion in A&R and marketing

Today, the IFPI, in association with WIN, have released Investing in Music, a new report that highlights the investment that record companies make in artists and repertoire (A&R) and marketing.

The report shows that record companies remain the primary investors in artists, investing 27% of their revenues in A&R and marketing, an increase from 26% in 2011. The report estimates that record companies worldwide have invested more than US$20 Billion in A&R and marketing over the past five years.

Investing in Music highlights the multi-billion dollar investment in artists made every year by major and independent record labels.  It is estimated that the investment in A&R and marketing over the last five years has totalled more than US$20 billion”, said Frances Moore, chief executive of IFPI. “That is an impressive measure of the qualities that define the music industry, and which give it its unique value.”

The report also reveals that more than 7,500 artists were signed to major labels’ rosters in 2013, with tens of thousands more signed to independent labels. One in five artists on a labels’ roster is a new signing, which illustrates that fresh talent is the lifeblood of the industry, says the IFPI.

“Most artists who want to make a career from their music still seek a recording deal,” said Alison Wenham, chair of WIN. “They want to be introduced to the best producers, sound engineers and session musicians in the business. They need financial support and professional help to develop marketing and promotional campaigns.”

The report shows that record companies invest a greater proportion of their global revenues into A&R than most other sectors do into research and development (R&D). The music industry’s investment of 16% of revenues in A&R exceeds the R&D investment of industries such as the pharmaceutical and biology (14.4%), software and computing (9.9%), or technology hardware and equipment (7.9%) sectors.

The report includes data from record companies around the world, and features case studies on Ed Sheeran, 5 Seconds of Summer, Lorde, MKTO, Negramaro, Nico & Vinz, Pharrell Williams, and Wei Li-An.

The full report is now available via the IFPI website.

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