2 Riveting Music Business Ideas You Shouldn't Overlook
Much like any other trade, the music world is undergoing substantial changes. But two particular music business ideas are going to revolutionise the industry as we know it. If your middle name is anywhere near “entrepreneur”, you should take a closer look.
Indie on The Rise: Label and Artist Services
Coined “the fastest-growing segment in the entire music industry,” label and artists services are estimated to become a $2bn sector in 2020 (that’s 10 per cent of the entire music industry, growing at a 35 to 40 per cent rate year over year).
As far as music business ideas go, record labels are out; label services are in. With the rise in streaming, digital marketing, and artists’ growing awareness of their independence, label services are starting to overpower the classic label scheme.
Not wanting to fall behind, major labels adapted to the new norm, and many now possess their label services division, including buying up independent ones.
This gives labels a bigger set of options to present to artists and enables them to both keep their old artists and win new ones (which is essentially what UMG did with Taylor Swift and Stormzy).
Artists choosing a more independent approach to the industry is nothing new, but lockdown introduced a whole new catalyst for production. “What else is there to do [other than work on music]? I can’t remember the last time I was this productive.”
Label services have become an increasingly common choice for entrepreneurial artists, partly due to its transparent terms of business. This results in more record labels owned and run by artists and management.
Still, that is a big task, and that’s why label and artist services are among one of the best music business ideas.
“Many of the most experienced record label execs are scrambling to adapt their business models as the impact of streaming changes the very nature of music consumption.”
Playing a Major Role: The Gaming Industry
There are two puns in there, and we really hope you took notice of that.
And if that didn’t spark your interest, maybe this will: predictions state that 2020’s global games market will generate revenues of $159.3 billion, a healthy year-on-year growth of +9.3%. To top it off, Covid19 gave the gaming world a batch of new clientele.
So what exactly does this mean for music?
Well, for starters, the gaming world catapulted the culture of virtual concerts and gave artists a new platform for music distribution. Second, it’s become a medium by which people, especially the younger generation, discover new music.
Although still a new concept, plugging music into the gaming ecosystem in the form of an interactive platform is already proving an inimitable innovation.
“This also opens so many avenues for brands to be the first in certain games or try certain activations. This is truly an exciting time for global brands to tap into a medium that is growing exponentially.”
But the most profitable music business idea stems from a particular strategy the industry is using to bridge with the gaming community: streaming.
Now, we have talked about how streaming is taking over the music world, but we never really dwelled into the issue of how an algorithm controls your livelihood.
In short, one minuscule copyright violation and your account could be penalised with a 90-day streaming ban. But independent EDM record label Monstercat found a way to bypass the standard model of music distribution.
“We have what in the music space is rare: the master rights, and the publishing side of the record, which a lot of record labels don’t hold. So it provides us with the ability to work creatively with video games and collaborate in new ways,” says Monstercat director of A&R Jonathan Winter.”
One of these ways is to distribute music over live updates to players just like on traditional music platforms, with songs appearing in-game the same day they come out everywhere else.
If there is anything musicians can learn from gaming is the importance of finding new ways to engage with fans.
So whether it’s adapting the techniques used by game developers and publishers to promote your music, or jumping on the opportunity to introduce your music into the gaming world, investing the gaming industry is a music business idea you really should pass.
There are countless lists of ideas that could potentially turn you into a musical entrepreneur – the key is to look at current trends and pick those with the best market potential. Labels will never go away, and gaming is starting to gain traction. With both markets undergoing a revolution, there isn’t a better time to be a part of a new musical revolution.