The Top 5 Major Money Makers in the Music Industry

The Top 5 Major Money Makers in the Music Industry

Hi! If you are reading this information right now, you are probably an artist/singer/vocalist/musician/producer/songwriter/rapper/music enthusiast, etc. and you desire to know more information on the major money makers in the music industry, then keep reading..

There has been a major shift in the recording industry and the music industry as a whole. The gift of technology has come to change and evolve these industries and it requires a change in the way you think as the artist/singer/vocalist/musician/producer/songwriter/rapper/music person, etc.

Mr. Apple himself, Steve Jobs predicted “The iPod will go down in history as a turning point for the music industry. I can’t overestimate it!” His prediction rings true and the music industry continues to evolve.

So, if your goal is to remain or become relevant where your music career is concerned, it is imperative that you modernize your thinking and shift with the times or get left behind! Your choice!

I come to inspire you to enlighten your perspective about how making money in the music industry is achievable and very possible regardless to your genre or style of music. Emerging in the music industry is The New Rockstar Philosophy“.

Autopsy of an Industry

According to Donald S. Passman  author of All You Need to Know About the Music Business: Ninth Edition, “CD Sales are under 25% of the business and dropping. Downloads have fallen 15% per year for the last few years.

Piracy is alive and well, hiding under cyber-rocks, YouTube delivers more audio-only music than all the other sites put together (including pirate sites), for which the creators are paid very little. The Industry earnings are almost half of what they were in 2003.”

He also stated that there is massive growth in vinyl because to younger people, they think it’s a new technology (Go Figure!) The only reason it’s held back is because every vinyl plant on the planet is at full capacity.

The not so good news is that it’s less than 2% of the business in this postmortem recording music industry.

If you have been awake for more than that last decade, you’ve heard how music piracy is supposedly killing the music business. You’ve witnessed the decline in physical CD sales.

You’ve seen the major labels cut and merge to stay afloat. Every year there are new statistics to further point out the end of an empire. It’s clear that this change isn’t stopping anytime soon.

However, music is universal and is eternal. So, although there may be changes, music will never stop.

With all this instability happening in the music industry, how are new artist/singer/vocalist/musician/producer/songwriter/rappers etc, going to build their careers?

How will existing artist/singer/vocalist/musician/producer/songwriter/rapper/music enthusiast, etc, survive the modernization of the recording and music industry. This is where you have to change the way you think.

All You Need to Know About the Music Business: Ninth Edition

It has been proven the internet can truly be an artist’s best friend and a sustainable and passive income for any one interested in learning how to make money online. There’s an innovative ecosphere emerging where artists can create their own careers without the involvement of a controlling record label.

It’s a world where artists can sustain careers, make more money and attract more fans.
We believe that this is the best time in history to be an independent musician. It just requires a major shift in your thinking.

Let me help you further shift in your thinking,  estimated “the U.S. E-commerce economy is worth $349 billion.” Forrester Research INC. reported “Online sales in the United States are expected to reach $523 billion in the next five years, up 56% from $335 billion in 2015.”

I want to inspire you to reexamine how you approach your career in music. The way people consume music has changed significantly over the last 15+ years, and yet artist are still doing things that worked with the old system. You need to have the wisdom to know when it’s time to change. Then take the necessary steps to change.

Making Money In The Music Industry

Music Industry: All Five Money Makers VS. Recorded Industry: Only Selling Recorded Music to Fans

Major labels made a lot of money in the 20th Century selling recorded music. It was their bread and butter. It provided them with enough income to fill libraries with rock-n-roll excess. That world has unfortunately slithered away.

Today, the record industry is suffering, NOT the music industry. People are not buying recorded music like they used to, and that has the major labels crying foul. That has them doing everything in their power to control music.

On the flipside, we have the music industry; which is thriving like never before. Music is easier to access than ever before and every niche in the world is represented. New brands come out of nowhere and real careers are formed independently.

Is Getting Signed Still Your Main Goal?

It’s been embedded into our minds; getting signed to a major label was the golden ticket to fame and fortune. Even though we’ve heard the countless stories about how artist are getting screwed by labels, albums being shelved for months, and countless other dreadful accounts, some artists still want a major label deal. Major labels used to offer a lot to an artist in terms of launching a career, but the value and money offered is declining as the world evolves.

Understanding The Role of a Major Label

A Major Labels Cash Will Give You:

• An advance depending on how much they think you’re worth = how much they think they can make your records. This advance is a loan, which you will pay back through your record sales.

• They’ll market your album. This is also an expense that you will pay back through record sales. Another loan.

• Offer tour support. However, another loan.

• Find you licensing opportunities in TV/Film/New Media/etc. They’ll do that only if you’ve given them some/all of your publishing rights.

There’s a statistic out here that 9/10 major label record releases fail. Those “failures” may sell thousands of units, but since the label spent so much money recording and promoting it, they didn’t turn a profit and consequently the artist doesn’t get paid.


Reality Check

Almost any label (major or indie) expects you to already have a fan base and be touring. This is insurance for them, as the more you can do it on your own, the less risk they have in signing you.

They’ll be confident you’ll make them money and not break up after the record is released. The more you bring to the table, the more demands you can make, and the more you’re seen as a partner to the label.

Examples of this would be artist such as  Michael Jackson, Prince and Chance The Rapper.

The New Rockstar Philosophy

You must understand how the music world works if you want to make money with music. I personally have a love for both the creative arts and business, which allows me to move between the two worlds and help relate them to each other. The marriage of art and e-commerce has always absorbed me.

They can’t exist without each other yet the concept of creative freedom, and the need to control exists without each other- nonetheless the concept of creative freedom, and the need to control costs in order to have a business, these are eternally locked in an intense battle with in me.

The truth is everybody cannot be the #1 Pop Star of all time. However, you can still make a sustainable income and experience massive success as whatever you aspire to be.

As creative people, we have to channel our creative energies into innovative business ideas and satisfy our need to perform by teaching, lecturing, and playing our instrument.

Making a living from a business you don’t understand is risky. Until now, a great number of artists, including major artist, have never learned the basics of how record royalties are computed, what a copyright is, how music publishing works, and a number of other things that directly affect our lives as musicians.

Many don’t know this stuff because their time was better spent making music. They weren’t interested; it sounded too complicated. But without knowing these basics, it’s impossible for them to understand the details and complexities of their professional lives. And as their success grows, and their lives get more complex, they become even more obsolete.

Remember: No One takes as good care of your business as you do. Participate intelligently in your career decisions.

Writing things down will shift your brain into thinking about how your music fits into the post-internet music business. Post-internet = the omnipresence of the internet is assumed, accepted, and engaged in. It’s not a “Thing” anymore; its part of your daily life like drinking water or eating or crapping… you get my drift!

Music industry insiders always say writing things down will shift your brain into thinking about how your music fits into the new music business. It’s like playing an instrument. You can read about it all you want, but the real learning comes from playing.

Knowledge is power and today you can access nearly any sort of knowledge to make big changes to your music calling. But without action, knowledge is a squandered opportunity.

So with  The New Rockstar Philosophy I encourage you to become as engaged with the business matter as much as possible. That means literally researching, writing and actually doing the ideas and concepts to make money from music online. Let’s take a look at some of the current trends in the music industry.

Make Money With Music- Trends In The New Music Business

Going Direct To Fans

Artists can create a community based around them, go direct to fans, and make real money. With services like Topspin  it’s getting easier to engage and sell customized products to your target audience and make a great living doing so.
Artists like Jonathan Coulton, a niche songwriter who’s songs almost never gets played on the radio, proved that musicians can make money without a big label. In 2010, Coulton’s  music brought in about $500,000 in revenue. Since his overhead costs are very low, most of that money went straight to him.

The Streaming Music Pool

Get as much music as you want for a small monthly subscription. The goal is to make piracy seem like a annoyance by making the cost next to nothing. Streaming services like SpotifyAmazon Music Unlimited , ITunes , etc., are making this a reality. However, the benefits for the artist are still being debated.

Physical Sales For Hardcore Fans

As the majority of people can now get music for free, physical music sales may only exist as something for true fans. Vinyl is still alive and kicking. The sound is better, the art is bigger, and it feels so right when you hold it in your hand.
Nine Inch Nails, Radiohead, Jack White’s Third Man and others have taken a new look at physical music. Radiohead’s In Rainbows was offered as an $80 special edition box set. NIN offered The Slip as a Deluxe Limited Edition for $300  and Third Man Record continually offers limited edition multi-colored and multi-function vinyl to its hard core fans.


Crowdfunding is the most significant funding method to happen to musicians in the last while. The basic idea is that you engage your fans to become stakeholders in your art through selling them a project via online funding platform like Kickstarter , Krowdster, etc. With this model artist like Amanda Palmer  have raised over a million dollars for specific projects that her fan base funded.

The New Rockstar Philosophy is a new frame on an old idea. The basic idea is that people will pay a monthly or yearly fee to get exclusive goods, consistent new content and whatever else you can imagine that will make it worthwhile for them .

When used correctly, The New Rockstar Philosophy becomes the foundation of an artist’s identity, philosophy, and income because you focused your career with l,000, on a moderately small group of fans instead of trying to please everyone. With this model, you can sustain a great career with a 1,000 true fans or supporters.

As it stands today, there are 5 major techniques artists make money from music. Here are the top five major money makers in the music industry.

The Top Five Major Money Makers In The Music Industry

Playing Live

Live music will always play an essential part in the music industry because it brings people together. The lights, instruments, music, sweat, etc., all contribute to being the best ways to truly win over fans.

Live music has been there since the beginning and it will outlive all the other money makers in the end. People will always pay for the experience of being there because there is no substitution for that. How much they’re willing to pay is a different matter.

Publishing & Licensing

You know when you hear a song in a video game, film, commercials or other media? That falls into the world of music publishing and licensing. Publishing is the administration and exploitation of an artist’s copyrighted works (songs) and making sure they aren’t used illegally.

Licensing involves renting out your copyrighted songs to be placed in a commercial/film/TV/etc. In both cases, more musicians are now looking at these avenues as a realistic and practical way to build businesses.


Merch can be an important income stream for an artist. When people wear your band’s shirt, it’s like wearing a badge of loyalty. They are part of your tribe and you are their leader. It may sound epic, but it’s true to a certain degree.

You are enhancing their lives with your music and this is a way for them to express that to the world. Also, the profit off a $20 t-shirt can be more than a $10 CD.
In addition, merch doesn’t only mean t-shirts. It could mean weed grinders, action figures, sex toys , and more can all be marketed toward your audience. Just make sure it fits with whom you are.

Selling Recorded Music

Whether it is vinyl, digital, CD DVD, the cloud or other, music is still being purchased. Although this world is facing some confusion with streaming service, there will be a market for selling recorded music for a long time.

Content-Based Websites

Content-Based Websites tailored to your passions and interest targeted to a specific niche market is one of the best innovative online business idea or work at home business ideas to manifest its way into the way we currently live. Everyone, well maybe not everyone, but billions of people all over the world access the internet for information, socialization, and education.

Change the way you think and use what you know to create other sources of income while still working on your music. You can use these content based websites to sell your music yourself. It’s simple and any one can learn how to build your own online business. You just need to be inspired and take action.

I am not promising instant success after reading this article, but what I hope is that you’ll be inspired and re-think the way you do things and expand your music consciousness. If this article was any help to you please feel free to leave your comments in the comment forum. Also, share this post to your network and help me spread the word.