Streaming services haven’t only revived the music industry — they’ve also reshaped it, changing the focus of A&R and marketing and incentivizing executives to prioritize hip-hop over rock and hot singles over big albums. More than ever, major labels and large indies are chasing — and paying big money to sign — artists who can deliver hits fast.
At the same time, those hits — indeed, all newly released songs — account for a smaller percentage of overall music sales, including streaming, than ever before.
In 2004, when album sales still drove the U.S. recorded music industry, current music — meaning releases less than 18 months old, plus older albums that remained in the top half of the Billboard 200 or still received significant radio airplay — accounted for 64.2% of that business. Catalog — music released more than 18 months ago, with the exceptions noted above — made up the remaining 35.8% of sales.
In the past decade and a half, however, those numbers have reversed: Current music accounts for 35.7% of album consumption units in 2019, while catalog makes up the remaining 64.3%, as of the week ending Oct. 10.
This might seem counterintuitive: Aren’t hit songs taking off, and making money, faster than ever? They are, by some measures, although much of the revenue they bring in will come in the future. But as the streaming-driven business monetizes music according to consumption, rather than sales, the sheer volume of catalog music available weighs more in comparison. While most physical stores devoted more shelf space to new releases, the vast majority of the music available on streaming services is older.
One theory is that, previously, data used to show what consumers were buying — and that was mainly new music. The music industry’s new economic model still captures what’s left of sales, but the industry can now also measure and monetize what music fans are listening to in their home and cars — and that is older catalog music.
So why are labels so focused on breaking the next big hit?
Largely because the catalog that brings in the most revenue has changed almost as much as its importance in the business. In 2018, 73% of all streams were generated by music released from 2010 to 2018, while a further 15% came from music released from 2000 to 2009 — meaning that 88% of all streaming music consumption came from music released this century. In terms of track sales, the disparity is almost as dramatic: 83% of sales come from music released since 2000, compared with music from the 1950s, ’60s, ’70s, ’80s or ’90s. In the CD era, the catalog business was more focused on older music from the ’60s and ’70s — classic rock standbys like Led Zeppelin, Pink Floyd, the Eagles and AC/DC.
For catalog labels like Warner’s Rhino Records, Sony’s Legacy Recordings and Universal’s Universal Music Enterprises, monetizing catalog has often involved releasing and marketing box sets, remastered special editions and anniversary packages. As sales continue to crater, however, labels are having a harder time driving interest in older music. This year, music released before 1990 accounts for just 4.29% of all streams, according to Nielsen Music.
The ways labels market catalog and current hits are diverging. Frontline labels are pouring millions into marketing singles from developing acts in the hopes of enticing consumers to become fans — and explore more of their music in order to generate more revenue. On the catalog side, however, “getting movement on one track doesn’t do shit,” according to a major-label executive. “Everybody in catalog is trying to figure out how to move the overall needle.”
Catalog promoters don’t just rely on oldies radio and big synchs, but also social media and playlist marketing. One trick is to drive traffic to playlists like Spotify’s This Is series or Apple Music’s Essentials, says Jay Gilbert, a principal in the artist- and label-services firm Label Logic. Another strategy: Use existing visuals from an artist’s career to create music videos for older hits that never had them, as Led Zeppelin did a few years ago using old concert footage set to studio mixes of songs like “Whole Lotta Love” and “Rock & Roll” or The Rolling Stones did in 2018 with a new lyric video for “Sympathy for the Devil.”
“Our job is to encourage the fans to go deeper than two or three tracks into an artist’s catalog,” says a catalog executive at a major label. “There are tons of stimuli that could bring the consumer to our artists, whether that be songs used in movie trailers, TV shows or commercials. Now, people can Shazam a song, find it and listen to it immediately.”
For any act, from any decade, reaching an audience these days seems to require just that kind of immediacy. In general, the catalog executive says, “it’s important to post something new to the artist page on a service every week that will draw eyeballs.”
This article originally appeared in the Oct. 19 issue of Billboard.