The Reality of the Music Business

Navigating the music/radio/media industry can be tough at times. This blog is all about helping you grasp a few basic concepts, that will get you started in the industry


If you want to be successful in the music industry there are four key things you need to understand.


1. You are a businessbeing creative doesn't, and shouldn't disqualify you from being a business. In fact, you have the potential to generate a turnover annually, whether it be a few thousand bucks or millions of bucks. The music industry like any other is based on the primary business principle of return on investment (ROI). The music industry, like any other business industry has certain rules, stakes, players and of course; winners. In order to be successful, you have to carefully plan your strategy and carefully follow the steps and processes in between your song being written and eventually published/sold/exploited for profit.


2. Most artists shy away from the business side of the creative industry - whilst we get this, that for the most part, creative people prefer spending time being, well creative, in order to be successful in the music business, you need to learn and understand at least the basic principles of the music industry, and grasp the basic concepts of business practice. This is easily achieved through articles available on the Internet, and also through attending courses and workshops. Don't be afraid to ask questions. You also need to realize that success does not happen overnight, but is instead a process that takes considerable effort, time and for the most part monetary investment. Talent is but a small part of the industry.


3. You need to build from a solid foundationspend the time building a solid foundation for your business to operate from, this will include a business plan, registering a company, researching your field, selecting a team to work with, researching your competitors, financial projections, networking for gigs and promotions on radio and television, attending music seminars and workshops. There are many people required in each stage, step and process (chain of events) to make any business strategy a success and each should add specific value. These people and their skill usually come at considerable cost. Spend the time to ensure a great business foundation, so that when you are successful, you can enjoy the fullness of that success without having to waste valuable networking time and resources addressing problems.


4. You have a limited time span for your careerthe average career lifespan is about 45 years. You need to plan for income through your music in the turbulent and often unpredictable music business (this is simply because the market is consumer driven). Very few artists enjoy a 45- year music career. You have to maximize every opportunity that presents itself, because the reality is that you may only enjoy a season of success (a few years maybe even a decade in the industry). You literally cannot afford to be lazy or 'half-hearted' about the business of your music. Approach the business side with as much enthusiasm and interest as the creative side of the industry, and you will be successful.


To further help you understand the music industry, here is a brief overview and explanation of Record Companies, Record Labels and Record Producers, and their functions. Back in the day, these companies were the back bone of the industry in terms of recordings and distribution of artists. With the introduction and advancement of the digital age, more home studios, and independent releases, record companies have had to adapt, but still offer the same services


Record Companies record and release your music, which can be in the form of MP3's, CD's, DVD's – the tangible products of the music industry. They sign artists to recording contracts, decide what songs those artists will record, and determine which songs to release. Record Companies are also responsible for providing recording facilities, securing producers and musicians, and overseeing the manufacture, distribution and promotion / marketing of new releases.

Before a record company enters into an agreement, a financial analysis is carried out. This analysis will always include the recording & marketing costs; a risk analysis and sales forecast. The analysis is a very detailed projection of how your material will perform in the market. If sales do not justify spending money on your album, the record company will not invest. Remember that a record company will ALWAYS have the final say.

The sales department of the record company sells product to retailers. This particular department is only interested in money. How many units have been sold?

The marketing team must be able to provide evidence that will convince the sales team that they can make money from your material



A record label is a brand specific part of a record company: house, electro, jazz, soul, funk, rock and so on.


Record Producers


The independent producer is the creative coordinator. They are usually the ones with the most creative control over a recording project, and ultimately responsible for the finished product. Producers play a large role in deciding what songs will be recorded for a particular project and are always on the lookout for new songs for their clients.


We hope this helps you a little more as you navigate through the music/radio and media business industry!