125 Years of Billboard: How the Music Business Changed Across Decades

Billboard’s new issue celebrates the 125th anniversary of the magazine -- and all the ways music has evolved along with it. As the sounds and styles of the world’s most popular artists changed, so did the business of music, too. Below, we look back on how some of the industry’s most important sectors -- labels, publishing, touring and distribution -- transformed themselves over the past 125 years.

As technology changed, so did the fortunes of the recorded-music business, with indies growing into the majors that dominate today.

In the beginning, every label was an indie. At the turn of the 20th century, as phonographs became household staples, companies like Columbia and Victor began slapping labels on the center of their shellac discs, marking the birth of the record label and the beginnings of the recorded music business. As technology evolved -- Columbia introduced the 33 rpm LP in 1948, RCA Victor the 45 rpm in 1949 -- the business grew into a global operation of superstar artists -- and, eventually, executives -- of all kinds.

By the time rock’n’roll caught fire, the record industry was booming, with companies like EMI, Decca, RCA and Columbia snapping up smaller companies and launching genre-specific imprints, introducing the concept of the major label. And record label functions expanded: Content owners with marketing wings added departments for A&R, promotions and publicity.

The 1960s and ’70s saw the rise of new, visionary executives with artist-friendly independent labels that would shape the modern music business. Ahmet Ertegun’s Atlantic, Chris Blackwell’s Island, Berry Gordy’s Motown and Warner Bros. Records under Mo Ostin helped create a new paradigm where artists were valued for more than just their earning potential.

Ricardo Santos

When Sony and Phillips released the first CDs in 1983, the recorded-music business exploded, with U.S. revenue nearly quadrupling from $3.8 billion in 1983 to a record high of $14.6 billion in 1999, according to the RIAA. The boom brought forth new players like Interscope, Universal Republic and Def Jam, while consolidation created megacompanies like Sony, BMG, Warner Music Group, EMI, Polygram and MCA (the latter two of which merged into Universal Music Group in 1998) that cornered large swaths of the market.

It all crashed at the turn of the 21st century with the arrival of Napster, iTunes and the digital revolution. U.S. revenues bottomed out at $7.1 billion in 2014 as companies scrambled to stem the bleeding. Again, the industry consolidated, from five major labels to four, then to three in 2012 as EMI was carved up and sold. Imprints shuttered, indies struggled for survival, layoffs gutted companies, and the remaining major labels -- Universal, Sony and Warner -- looked for new revenue streams, leading to the “360 deal,” where labels took a cut from artists’ touring and merchandise income.

Today, streaming has led to new hope, as revenue rises again. Marketing, promotions and sales divisions have gone digital, while playlists have grown to rival radio in importance. Streaming has provided a path for indies to rise again and even for artists to eschew the label system altogether. The majors continue to run an increasingly global business that is still in recovery, but there’s more room for others to find a niche -- and for labels to chart a new path into the future. -- DAN RYS


From Tin Pan Alley to hedge-fund billions, publishers have found their value.

For nearly 70 years after the passage of the Copyright Act of 1909 during the Tin Pan Alley era, music publishing was considered an arcane backwater of the music industry that dealt mainly in pennies. Beginning in 1986, publishing evolved into a multibillion-dollar sector that has the clout to get Congress to pass laws like the Music Modernization Act and fight for a bigger slice of the music dollar.

From 1909 through 1977, every music format -- piano rolls, shellac, tape or vinyl -- paid a mechanical rate of 2 cents per song for each copy sold, while performance royalty rates were smothered by consent decrees that performing rights organizations (PROs) ASCAP and BMI first signed with the Department of Justice in 1941. It wasn’t until Jan. 1, 1978, that publishers received their first mechanical rate increase of the century -- to 2.75 cents per song, or half a penny per minute, whichever was greater.

Since then, publishing has gradually risen to the forefront of the music business. In 1986, Stephen Swid and his two partners, Martin Bandier and Charles Koppelman, bought CBS Songs for $125 million, at the time the highest sum ever paid for a music publishing asset.

Ricardo Santos

During the next 15 years, publishing assets ballooned in value -- and it was music publishing, not the recorded-music business, that began attracting attention from Wall Street traders and private equity firms due to the predictability of its income. Multiples for publishing assets began to increase, with net publisher’s share -- essentially gross profit -- reaching 12 and 13 times NPS by 2008, much to the delight of the publishers and songwriters willing to sell their assets.

While publishers continued to secure steady, albeit small, mechanical rate increases -- up to 9.1 cents per song per copy sold by 2006 -- they struggled to assert themselves in the new digital marketplace. PROs lost out on an early attempt to convince labels that downloads contained a performance and a mechanical right, for example. But they would win both for streaming, as well as the right to be paid directly by streaming services (instead of through labels). That allowed them to audit accounts to ensure they received correct payments -- and more aggressively push for higher rates from the Copyright Royalty Board.

Music publishing has made some of its biggest strides in the past decade. ASCAP and BMI have become behemoths, each regularly collecting and distributing $1 billion a year. SESAC commanded a $1.125 billion valuation when a Blackstone investment fund acquired it in 2017. And EMI Music Publishing was valued at $4.75 billion when Sony bought it in 2018. NPS Valuations have now surpassed 20 times net publisher’s share, and as streaming continues to grow, music publishers are becoming even more valuable -- and powerful -- than ever before. -- ED CHRISTMAN


From the (literal) Wild West to arenas and stadiums around the globe, live music has become the business’ most lucrative sector.

When Buffalo Bill Cody told big-city audiences that the live Western show they were watching included members of the Native American tribes that had defeated Custer in the Battle of the Little Bighorn in 1876, he was usually exaggerating. But Cody knew that authenticity didn’t really matter in places like New York and London: If it looked real, the audience would enjoy the show.

By the time he died in 1917, Cody’s shows had given way to dozens of competing touring productions, from rodeos to circuses to a new style of music known as jazz and stars like soprano saxophonist Sidney Bechet.

That pushed live entertainment indoors and led to the advent of dance halls, which began popping up nationwide in the early 20th century, followed by genre-based touring circuits: Country artists played honky-tonks across Texas, while African American blues musicians formed what became known as “the chitlin circuit” in the segregated American South. In the 1950s, audiences came out for more contemporary artists like Buddy Holly, Ritchie Valens and The Big Bopper, who all died in a plane crash in 1959.

The explosion of rock music in the ’60s and bands like the Grateful Dead, Jefferson Airplane and The Rolling Stones led early promoters like San Francisco’s Bill Graham to build venues that became hubs for a cultural revolution. Music halls like the Fillmore in San Francisco and Wonderland Ballroom in New York became more famous than the bands they hosted, and a new generation of promoters and pioneering booking agents like Frank Barsalona arose in cities across the country. By the mid-’70s, touring the United States meant negotiating a complex map of music bosses in each city -- Barry Fey in Denver, Don Law in Boston, Jack Boyle in Washington, D.C., and Maryland.

Seeing inefficiencies in how that promoter network operated, businessman Robert Sillerman bought up regional promoters in the ’90s, creating a company he called SFX, which, after it was sold to broadcaster Clear Channel, was spun off as Live Nation in 2005.

Today, the regional promoter network has largely disappeared, and Live Nation continues to acquire dozens of companies per year, having become the market leader ahead of the much smaller AEG. As the recorded music business waxed and waned over the past century, touring became artists’ biggest source of income. Arena and stadium tours by superstars have made today’s touring business into a $25 billion industry, and its global logistics systems and electronic marketing have become a behemoth of complexity. But it still doesn’t stray far from Cody’s system: build elaborate stage productions, seek out new markets, advertise relentlessly and never underestimate the public’s willingness to suspend disbelief for a few hours of entertainment. -- DAVE BROOKS


As consumption has evolved in the digital age, commerce has changed along with it.

Over the past century, music distribution has changed more dramatically than almost any other sector of the business. From an environment defined by limited dollars and shelf space, it has evolved into a business without gatekeepers, where virtual shelf space is unlimited and money only changes hands when music is consumed.

In the early days of the music industry, though, the regional independent distribution network was king. During the 1940s, ’50s and ’60s, record labels relied on regional distributors that covered geographic areas as large as four or five states to get their records into independent stores, local department-store chains and one-stop wholesalers, which also sold to indie stores.

In the late ’60s and early ’70s, distribution began to change drastically. Companies that would become major labels -- Warner Music Group, CBS Records and EMI -- began to build their own nationwide distribution networks centered on a branch system with as many as nine regional offices, each with its own warehouse. Indie distribution still managed to thrive through the ’80s, however, as small, local record stores evolved into chains, then nationwide retail powerhouses with names like Musicland, Tower Records, Sound Warehouse and Record Bar.

Ricardo Santos

Still, indie labels stuck with indie distributors. But trans-shipping wars -- when regional distributors shipped outside their regions to accounts serviced by other distributors -- created overstock problems and costly product returns. During the early ’90s, four indie distributors merged into the national network INDI, setting the model for others to go national as retail buying power concentrated in key cities that served big-box stores like Target, Best Buy, Trans World and Walmart.

At the same time, the major labels began buying or building indie distributors, taking on credit risk as major music chains went bankrupt due to price wars and digital encroachment. Real indie distributors, without the deep pockets of the majors, lost larger indie labels to them.

Today, only a handful of indie distributors survive. The ability to track, report and deliver payment on hundreds of billions -- and, soon, trillions -- of microtransactions, while providing the latest in database management, data mining and data analysis, is what rules distribution. New digital-first distributors have sprung up to flesh out the indie ranks, with companies like CD Baby, TuneCore and EMPIRE circumventing the established system.

Yet major-owned indie distributors still dominate, thanks to the powerful analytic tools they have built. As formats have evolved, distribution has become about keeping up with the swift pace of business. -- ED CHRISTMAN

This article originally appeared in the Nov. 16 issue of Billboard.