It may be a digital age, but live is still the big cash driver for the top 40 earners on our annual list
The U.S. music business offers a matrix of trends to satisfy chart watchers and number crunchers. New CD sales continue to fall. Digital music sales are rising nearly 10 years after the launch of the iTunes Music Store. Streaming and subscription revenue are growing as music lovers choose easy access over-and, sometimes, in addition to-physical ownership.
Concerts make up 68.9% of revenue for the 40 artists on Billboard’s Moneymakers list, which tallies artists’ annual earnings. Remove Adele and Taylor Swift, both of whom didn’t earn any U.S. touring income in 2012, and the average increases to 72.5%-a figure on par with the 72.6% in 2010 and the 68.3% that touring represented in 2011.
Madonna tops the 2012 list, in part because 93.5% of her total revenue came from concerts. Bruce Springsteen, a close second, earned 92% of his revenue from live shows. Roger Waters, a distant third, had the highest concert share on the list with 93.6%. The entire top 10 averaged 84.2% of their income from concerts, and the number would have been higher, if not for Justin Bieber‘s mere 60.1% share at No. 10 dragging down the average.
Billboard estimates the 2012 Moneymakers artists pocketed $373 million from concerts after paying agents, managers and expenses. That was up from $329 million in 2011 but down from $383 million in 2010. For all Moneymakers artists, touring income accounted for 72.8% of revenue in 2011 and 75.1% of revenue in 2012. Artists at the top of the list got an even greater share of revenue from touring. A top 10 artist made 84.2% of income from concerts in 2012 compared with 75.8% in 2011 and 81.7% in 2010.
Touring wasn’t vital for every act on the Moneymakers list. Two major artists, Swift — who topped last year’s rankings — and Adele, made the list without any concert earnings for the year. Meanwhile, two others-Mumford & Sons and Maroon 5-pocketed less than $1 million in concert earnings for 2012. In percentage terms, touring accounted for just 12.6% of Mumford & Sons’ total revenue and only about 2.6% of Maroon 5’s total.
Artists who made less than $1 million on the road tended to make more from recorded music — just as the negative correlation between concert revenue and music sales suggests should happen. Adele and Swift averaged $7.2 million in recorded-music sales while Mumford & Sons and Maroon 5 averaged about $3.2 million. The other 36 acts on the Moneymakers list, who each earned more than $1 million from touring in 2012, averaged just $2.3 million in recorded-music sales.
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Streaming revenue wasn’t terribly important to any artist’s overall income as measured by Billboard-not even those artists with little to no touring income. This isn’t to say streaming didn’t have an indirect impact on these artists’ revenue. Without the promotional benefit of, say, YouTube, some albums would have hardly been as successful as they were last year. But in terms of pure, direct revenue, streaming provided a mere pittance for music’s top earners.
Maroon 5 had the highest streaming share of 2012’s Moneymakers list with 3.5%. Within that, the highest noninteractive streaming share was 0.5%, or one-seventh of the total. Drake had the second-highest streaming share with 3.3%, and One Direction had the third with 2.5%. It’s not surprising that Maroon 5’s “Payphone” and One Direction’s “What Makes You Beautiful” were the No. 5 and No. 6 tracks, respectively, on Spotify in the United States in 2012. (Maroon 5 had two more songs in Spotify’s top 100 of the year.)