You know how we’ve always envisioned a world where almost everything is technology, virtual and online? Well I think, we got our wish much earlier than anticipated when the earth, or almost most parts of it was hit with a deadly disease earlier this year.
The Coronavirus, or commonly known as Covid-19 began in China at the end of 2019, and spread like cancer from person to person. Being so easily transmitted from one to the other, countries worldwide took necessary precautions in early March 2020 to curb the epidemic.
One of the more prominent efforts were home quarantines and the banning of all large gatherings. They were highly effective for dealing with the virus, unfortunately not so much so for everything else. Putting a stump in education, jobs, social activities and basic freedom, thinking about the greater good came at a higher cost than expected.
Many major industries and economies got heavily impacted due to the measures taken to prohibit the spread of Covid-19, including that of the music industry.
According to the World Economic Forum, the music industry is worth over $50 billion with two big income streams. The first, live music (sales of tickets and live performances), which makes up to 50% in revenue, and the second, recorded music (streaming, digital downloads, physical sales and licensing of music for movies, games, TV and advertising), making up the other 50%.
With Covid-19 and all its preventive steps though, the usual 100% that the industry would make, has significantly dropped because of five simple yet devastating reasons.
1. Physical sales lessening by one third
2. Digital sales falling by 11%
3. Media buyers and brands putting a pause on advertising
4. One third in digital ad spending being reduced
5. An almost zero live music revenue
Due to their high-risk nature, with live performances, shows, tours and music festivals getting cancelled or postponed for 6 months, number 5 has somewhat been the industry’s biggest loss. Besides losing on ticket and merchandise sales, the temporary pause has also cost them to lose almost $10 billion in sponsorship(s).
However, despite all the darkness, there is fortunately a tad bit of light. In order to cushion the blows to artists and crews, corporations like Universal Music Group and Live Nation Entertainment, as well as streaming giants such as Spotify, Amazon Music, TIDAL, YouTube Music and many others have all made hefty donations to help.
Besides that, governments worldwide have also set up aid packages for all those affected by the Covid-19 crisis. Trillions of dollars have been wired in terms of spending, grants and loans as a safety net to all industries.
On top of all of that, Covid-19 has also provided a means for recording artists to put technology to the test. Beginning with live streaming, to Twitch, Instagram TV, Zoom, virtual events, video series and others, artists have proven that no virus can come between them and their fans.
Discovering various methods to go into homes and build a more intimate, long-lasting relationship with their fans, audiences have grown tremendously with the help of recording labels providing all the needed equipment. Streaming platforms also discovered new ways of making money, with memberships to artist channels that allow exclusive access to content, virtual gatherings and paid-commenting features.
The pandemic, which has now lasted for more than half a year, has not been an easy path for anyone. In one way or another, even without being infected, we have all been affected. No one is quite sure of what the long-term gain is for the music industry, but just like every other industry and economy out there, it is doing everything in its power to help as much as possible amidst these trying times.