Everyone knows the current story line in the music industry: streaming services and illegal downloading platforms have decimated record labels’ income. With less money making its way up to the labels, the influence they have has waned in recent years. So are record labels on their way out? And if they are, does it really matter?
2015 was an amazing year in music for British artists: the three biggest selling artists in the last 12 months were Adele, Ed Sheeran and Sam Smith. However, 2015 also recorded a new low of physical copies sold, a number which has slowly been decreasing over the years.
The vast majority of music is consumed via streaming services like Spotify and Apple Music. 26.8 billion songs were streamed last year, a rise of 82% according to the trading body BPI. The most streamed artist last year was Drake who was also the most illegally downloaded artist.
This change in the way we consume music is plunging the record labels into disarray. Decreased sales mean less money for labels, which means lowered budgets and all around decreased influence in the industry. Luckily for artists, this has all happened during the era of the internet, which serves as the perfect place to promote your own music and build strong fan bases.
So why do artists still need labels? The answer is: a lot of them don’t.
Music labels are less and less relevant, and the growing success of independent artists proves this. Millions of aspiring artists release music on the internet every single day, via Soundcloud, Facebook, Youtube and their personal web pages.
The positives of this approach are clear to see. They are able to build huge cult followings by reaching people all over the world, without the need to tie yourself to a company which wants to make money from you. And the power of what record labels can offer you is diminishing. You no longer need a label to promote your music or create a brand. Instead, you can do it yourself with a few trusty click of your mouse. It is clearly an attractive prospect for many artists.
Some of the most successful artists in music right now have adopted this strategy. For example, Chance the Rapper releases all of his music online for free and makes his money from touring independently.
He has full creative control over his music and its release. With a strong internet presence he has built a loyal and growing fan base that flock to every show in their masses. A lot of artists now make the majority of their income through gigging anyway, so it can make sense to allow your music to be downloaded for free, meaning that as many listeners as possible have access to it and therefore more people are likely to come to your shows.
Macklemore and Ryan Lewis are another pair who have stuck to the independent route and flourished. Macklemore and Lewis ran the Seattle underground hip-hop scene for years, releasing mixtapes and performing around the city. In 2012 they decided to release their first studio album independently, titled The Heist, which charted at number 2 in the US and won four Grammy Awards including best rap album.
These two triumphs show that releasing music independently is a lot easier now than it was even five years ago, and with Chance on his third project following a world tour, and Macklemore and Ryan on their second, the desired level of success and longevity is clearly achievable.
Some artists also go down the route of releasing music on their own record label. In recent years Kanye West, Katy Perry, Missy Elliot and Jay Z have all set up a label and released their music through it. Although, obviously setting up a label costs a lot of money – most of these already had a few bob lying around to fund the operation.
Being an entirely independent artist has a lot of major perks. However, you cannot ignore the fact that there are some obvious advantages to being signed to a major label. Some of the traditional reasons for seeking a record deal are still valid.
For example, labels clearly still have a promotional power which is difficult to replicate: they have relationships with radio stations and PR companies that can spread your music very quickly. They also have the money to put you in the studio, with a good producer, for far longer than you would be able to fund yourself. It’s also true that major labels’ deals with distributors would probably come in very handy.
The point is that these benefits are slowly being eroded away as the playing field is levelled by technological advances. Now, if your music is good enough it is very possible to make it without a label’s backing. You can make a very high quality recording in your bedroom with relatively inexpensive equipment, so there is less need for a label to pay for studio time.
The role of distribution has now been distorted as well, because if you’re giving away your album for free (and making your money from tours) you have no need to get it into shops and it’s easy enough to put your album on iTunes or streaming services. Once your album is online, it is now relatively straightforward to promote it as well – all you need is a SoundCloud page and some basic viral marketing and you can attract the attention of press and radio companies.
While you hear a lot about the negative impact that streaming and downloads have had on the music industry, there is also a positive side. People are able to find and listen to whatever music they want now, meaning that an artist’s success is based on the quality of the music they release. It is a fantastic leveller in the industry; success is no longer founded solely on how much money an artist has available, but rather based on genuine talent. Kanye West once said, “The internet destroyed the music industry.” Well, Kanye, we think it might just have saved it.