Tuesday, December 9, 2014

The Cost Of Breaking A Major Label Act

IFPI logo image
The latest IFPI (International Federation of the Phonograph Industry - boy, is that name outdated) recently came out with a report about the state of the music industry and a few of the elements that were analyzed included how much the major labels spent on developing new acts.

Here are some interesting figures.
  • The cost of breaking an act is between $500k and $1 million.
  • The typical advance averages between $50k and $350k
  • Typical album recording costs are between $150k and $500k.
  • The typical video production goes from between $50k to $300k.
  • Tour support is between $50k and $150k.
  • Typical marketing and promotional costs are between $200k to $700k.
Major labels spent $4.6 billion dollars this year on A&R and marketing their acts, and 27% of the major label's revenue went to A&R. According to the IFPI, this is greater than what the computer, pharmacology and biology industries spend on R&D.

Finally, there are 7,500 artists signed to major labels around the world. One in 5 is a new signing.

Most artists today really like the DIY aspect of building their career, but there's nothing like the monetary clout of a large label.

1 comment:

Rand said...

Yes, that certainly is a lot of money. Not necessarily well spent as the proof is on the radio and TV.

"You can't make a silk purse out of a sow's ear."

"You can't polish a turd."

As long as the bottom line is paramount and budgets are controlled by the play it safe, no risk bean counters focused on cloning the other clones, and not allocated to finding and developing real artistic talent, we're doomed to only more of the same same but different...


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