A new breed of online video platforms is helping artists make money from live events without getting on a tour bus. With companies like StageIt, Gyroskope and Evinar leading the way, artists have entirely new opportunities to enjoy a career on the Internet.
The best-known of the three, StageIt was founded by singer/songwriter Evan Lowenstein of duo Evan & Jaron and launched in March 2011, with Jackson Browne, Jason Mraz and a host of lesser-known acts using it. Evinar, launched in March, hosts live events but focuses exclusively on the Facebook platform. Rather than stream shows, Gyroskope, which debuted in early June, offers a platform to sell concert videos directly to fans.
Artists already have an abundance of online tools to promote themselves and foster relationships with fans. A February survey for the Future of Music Coalition's Artist Revenue Streams project found that 44% of respondents use Facebook, 43% have an artist blog or website, 43% use YouTube, 24% are on Myspace and 23% promote themselves on Twitter.
But the Internet was supposed to be about much more than promotion. About a decade ago, the Internet was widely seen as a way to sell recorded music to people who couldn't purchase a particular title in a brick-and-mortar store. A music fan in, say, rural Idaho could buy the same music as a person living in New York with greater access to deep-catalog record shops. Thus, the Internet would allow artists and labels to reach underserved consumers.
In reality, however, such factors as file-sharing and online storage lockers have made generating revenue from recorded music even more difficult. Artists and labels hope consumers buy their music but offer them ample opportunities to obtain songs at no charge. Given the illegal options readily available to anyone with an Internet connection, purchasing music has become either a voluntary act of kindness or a premium put on the convenience of retailers like iTunes.
The industry shouldn't expect to monetize music the same way it did in previous decades, explains Alan McGlade, managing director at DEV and an investor in StageIt. The CD was great for the album format, for example, but the Internet is better for tracks, streams and other inherently digital media. "The reality is the Internet is a fundamentally different medium and opens up new possibilities for consuming music," McGlade says.
Music fans will undoubtedly continue to attend concerts, but online performances could become common events because they require so little investment from consumers. There is no travel time to the venue, no parking fees, no babysitter arrangements and no hassle getting home late. People can watch from the comfort of their homes or offices on a desktop, laptop, tablet or mobile phone. And watching from anywhere is a blessing for a fan who lives in a rarely visited, tertiary touring market.
You can't beat the cost, either. StageIt viewers have paid an average of $6.65 in "ticket" fees and "tips," according to Lowenstein, although that figure has risen to $8.53 during the last three months. Smith says the typical price for a Gyroskope video is $10. Both prices are far lower than entry into a small club and a cheap beer.
The costs to the artist can be minimal. Lowenstein says 90% of StageIt performances are handled by laptops and prove that fans will trade audio and video fidelity for a live experience. These low-tech productions are good enough for many fans-most artists perform acoustic sets, and shows might take place from the back of a tour bus or in a living room. Both StageIt and Evinar take 40% of gross revenue, while Gyroskope charges producers a monthly fee based on the number of files hosted and a small fee for fans' credit card transactions. Producers keep 100% of the sales.
Online video already has different monetization schemes for larger entities like sports teams, faith-based organizations, educational institutions and government agencies. Such online video companies as DaCast and Monetize Media offer enterprise solutions for publishers to monetize live video programs through advertisements, subscriptions or pay-per-view.
Individuals, however, need only these simple platforms aimed specifically at musicians. A service like StageIt provides a turnkey solution that requires nothing more than a webcam, a few fans and a bit of marketing know-how to generate awareness. Lowenstein says, "We believe people will come to the site saying, 'It's Tuesday night, I'm home from work. What's playing on StageIt?'"••••