From left: Ethan Diamond, CEO/Co-Founder, Bandcamp; David Marcus, SVP of Worldwide Artist Services, WMG; Emily White, Co-Founder, Whitesmith Entertainment; Zoe Keating, Artist; consultant Antony Bruno; Jon Irwin, President, Rhapsody International; before their panel on "Artist Revenues and Digital Music Economics." (Photo: Arnold Turner)
The fight over artist royalties on streaming services like Pandora and Spotify misses a more important reality: user data from these sites can be a much bigger gold mine to artists, labels, and promoters, and it needs to be unlocked, said several industry players during a lively panel discussion on artist revenues and digital music economics at the second day of the FutureSound Conference on music and technology in San Francisco.
Consultant Anthony Bruno moderated the 45-minute-long panel which featured Bandcamp CEO/Co-founder Ethan Diamond, Rhapsody president Jon Irwin, artist Zoe Keating, Warner Music Group David Marcus, and Whitesmith Entertainment co-founder Emily White.
SVP of worldwide artist services at the world's third largest music company, Marcus said 65 percent of Warner Music artists are in what would be called 360 deals. But despite all the hype around online streaming and radio services, the live show still drives non-recorded music revenue at Warner.
"It's tickets. That's where the action is for us," he said.
He sees streaming services at the gateway drug that gets people to buy a single, then a CD, a concert ticket, and a t-shirt. It was an opinion shared by many on the panel, several of whom want to see such services share more data with labels and artists.
(from left): David Marcus, Jon Irwin, Ethan Diamond, Emily White, Zoe Keating, Antony Bruno (Arnold Turner)
Artist Zoe Keating said artists should be given user data from Rhapsody and Spotify to identify fans and market to them. Keating made waves by uploading all of her revenue stream data to the Internet this summer, throwing back the curtain on artist revenue streams and kicking off a lively discussion. The majority of her revenue came from iTunes and Bandcamp, she said.
Right now, Spotify stream revenue is incidental to the opportunity to build a relationship with such service's users, she said.
"My music is available everywhere but I can't get that data. How do I reach those casual listeners? That's more valuable to me than some royalty," Keating said. "Artists are getting hung up on the actual number."
Rhapsody president Jon Irwin said the 11 year-old music subscription service is pivoting to focus on providing such services to artists.
"It's going to be to strengthen that bond between a fan ... and the actual artist"
Bandcamp's Diamond said the site already provides such data as a .csv format, but "it's criminal" how few artists use it.
Founded in 2008, Bandcamp is an online music store and artist platform used by independent artists. The company takes a cut of artist sales on the site and has received widespread attention thanks to use by artists like Amanda Palmer. Palmer sold $15,000 of music and merch from her Bandcamp page in just three minutes this Summer.
Diamond said Bandcamp paid out $1.7 million to artists in the last 30 days, and urged artist to do more direct to consumer sales to maximize margins.
Whitesmith Entertainment co-founder Emily White manages acts like Brendan Benson and Gold Motel. She said direct to fan sales represent the highest margin sales for artists working with her talent agency.
Web analytics are a big, underutilized tool for finding paying customers, she said. Facebook Insight allows her to see mismatches between fan interest in, say, Salt Lake City, and tour dates in Boston. She mentioned Imogen Heap is huge in Jakarta, Indonesia. Bookers had no idea, but web analytics showed it.
"And we got some very lucrative offers. I think it's a crucial tool to drive booking strategy," White said. "I look forward to booking agents who understand that."
Music subscription surfaces have only scratched the surface of connecting bands and fans. White and Keating envision something like Spotify pairing with crowdfunding site Kickstarter to crowdfund entire tours.
"It's so exciting," she said. "The tech is there but nobody gets it. Laura Keating and I are going to be all over that."