Key Takeaways

• Generally, independent music artists earn less than their signed counterparts.
• Many artists today seemingly prefer to be independent rather than to sign up with labels, as statistics over the last decade indicate.
• Independent music labels account for the largest share of the U.S. music industry at 41.4%.

Introduction

Major Findings

(a) Fan Base

• There are no definite figures regarding the average size of an independent musician’s fan base. However, the fan base of recent breakout stars could provide insight into this data point. For example, one of the biggest breakout stars in 2020-2021, Megan Thee Stallion, has 34 million followers on Twitter and Instagram. Another star, Lizzo, has 11.8 million followers. While these two are by no means ‘average artists,’ it is probable that the average independent musician in the U.S. has hundreds of thousands to several million followers if they are active.

(b) Ticket prices

• For the most part, independent artists are driven by passion for music rather than profits. For this reason, they are more likely to have cheaper tickets than their signed counterparts, especially when starting out. A limited fan base may also force independent artists to make their concerts affordable so that many can attend. The average price for a concert ticket was $96.17 in 2019, a 27% increase from the 1990s. Naturally, an artist’s popularity, band size, and demand affect the ticket’s price. However, all factors considered, it is plausible that independent music artists charge less because fewer people are involved.

(c) Earnings

• While cases abound of independents who earn six- to nine- figures, generally independent music artists earn less than their signed counterparts on average. This primarily boils down to the support that signed music artists get from an established record industry ecosystem that enables them to build a fan base much faster and get people to stream their music, attend their concerts, and/or buy their merchandise. To provide perspective, the median U.S. musician earns $20,000 — $25,000 per year.

(d) The growing popularity of DIY music

• Going independent is gaining popularity. With the merits of being an independent artist surpassing the demerits, the last decade has seen many music artists go independent. As of May 2019, there were 1,560 full-time independent musicians working in the U.S., up from 1,290 in 2018.

 

Source

 

• The advent of social media, streaming platforms, online marketing tools, digital music distribution, and advances in technology have created more opportunities for independents to reach wider audiences. Further, independent artists have more control over their careers, including the type of content and music they want to produce. Labels often earn more from artists’ work, a scenario that independent artists avoid by owning 100% copyrights to their music. Among other things, this allows them to determine how much each person who participated in producing the song gets from the royalties.

(e) Industry size

• In line with the growing popularity of DIY music, recent statistics indicate that independent labels account for 41.4% of the music industry in the U.S. Further, the average industry growth rate of independent label music production was 2.5% between 2014 and 2019. This positive growth trend is expected to carry on into the future as more artists take to independent music production.

Research Strategy