Top artists’ concert revenues typically 2-3x their album sales

By January 22, 2010Music

The Vancouver Sun recently posted a list of the top ten music earners of the last decade.  Aside from being shocked at how few newish stars made the list I was interested to see that nearly all of them made more money from concert ticket sales than album sales.  It would be interesting to know if the same ratio holds for smaller artists.  Here are a couple of excerpts from the list:

Position in list Album sales Concert sales
Celine Dion 1 $256m $522m
U2 5 $219m $391m
Bruce Springsteen 7 $144m $443m
Britney Spears 10 $299m $196m

I included Britney to make the point that there are outliers, and Eminem is another, he sold more albums than anyone else, but he doesn’t tour much and so didn’t make the top ten.

The bigger point though, is that for most of the top stars live performances are where the action is at – which is important for the whole piracy and artist revenues from internet music services debate.  Specifically, I wonder how many of those concert tickets were bought by fans who got to like the artist after listening to tracks downloaded from bittorrent.  Maybe piracy is helping the artists to make money.  Going forward the same could be said about Spotify – even if artists feel they are not making enough money directly from the service it may be a strong driver of concert ticket sales.

  • There's very little money in record sales fullstop any more. Based on some numbers I found, the Christmas No 1 was worth maybe £30k to Rage Against the Machine: http://withpretext.com/post/297084852/shilling-… …

  • Craig Williams

    But the record companies will maintain that the reason concert ticket sales are higher than record sales is exactly because of pirated tracks. They will say that if every track downloaded illegally was an actual sale then record sales would be much higher and so would their profits. Never mind the fact that just because you may have downloaded and Album or track does not mean you would have bought it, that doesn't figure in their calculations.
    If you make legal downloads cheaper then people will have no need to download illegally, but having to pay £7.99 for an album which basically just consists of data is highway robbery. But then when did we ever expect big business to play fair?

  • Tks. That certainly isn't much.

  • Dropping the cost of music far enough that people can't be bothered to pirate does seem like the obvious long term answer.

  • Interesting stats Nick. I kept wondering how lucrative touring was for bands…
    Anyway, I admit I quite like the current situation: music is easier to reach than ever (right or wrong), the number of gigs increased over the past years and although the prices increased too I'm happy with this balance. Plus, I keep paying for the bands I really care of. And as you said I may download something from bittorrent and then go twice in a year to one of their gigs. All winners.
    A note about a long term answer to pirate music – lower prices would definitely help (there must be a psychological level below which people will simply find it ok to pay every time) but sometimes it's how easy it is to download things that make that model almost invincible. Most times it's even faster to have music off bittorent than any other store… No accounts, no card details, nothing… how can you beat that?

  • Thanks Fabio. I guess I should pirate a few tracks myself to find out
    how easy it is!

    My limited experience with Bitorrent has been quite painful.

  • mikefeerick

    As a newly minted MBA grad in 1994, I joined BMG in London with part of my role to specifically investigate the potential effects of this newly emerging “internet” thing on the music industry. Very quickly, we concluded that the revenues from albums sales would decline dramatically and future artist earnings would be dependent on touring revenue.

    That may seem self-evident today, but what is most interesting is how long it took to happen. While today, we can see the potential of new services on the web – and with some certainty, be sure things that things will work out the way we predict, my point is that sometimes we have MORE time than we think to get things right. In a world with new gizmos, gadgets and online innovations everyday on the web, that might be a risky statement, but for an investor, it should suggest that its worth looking at new businesses that are getting a lot right, but still have a way to go to creating new ecologies in their market place. They are the ones which create the big value add – and they might just have more time to mature than we think, especially if they have the right level of capital, experience and leadership.

  • Hi Mike – couldn't agree more. Investing too early in a market opportunity is almost as easy and as costly as investing too late.

  • Franciorlando

    Celine is very good!!!

  • Winston O’Boogie

    Back in the fifties and maybe even the thirties and forties, musicians made the vast majority of their money by performing. Record companies made the money from the records. To the artists, records were a way to promote their live performances. That all changed in 1963 when the Beatles signed a contract to own the publishing rights to their songs.
    Soon other’s followed and live performances became a method of promoting record sales. So much was this so that The Beatles decided to stop performing live and earned their living completely from record sales.
    With the advent if digital, live streaming etc, it seems that the pendulum has swung back. Recordings are becoming much less valuable and artists are having to perform live again.
    Also, it should be pointed out that the numbers shown in this article are gross sales. The costs associated with putting on live shows and touring these days are astronomical. What the artist keeps after all of the cost associated with producing a record, publishing, distribution and so on, even with the artist owning a share of the publishing rights, is a very small percentage.