COVID’S Impact On The Music Industry (Breaking Down The Stats)

  • COVID-19 has devastated businesses worldwide, and the music industry is no exception.
  • It’s not all bad news – some artists have discovered new ways to monetize their work and reach new audiences.
  • We look at all the changes that have happened since the pandemic began.

While every industry has been kneecapped in some way by the COVID-19 pandemic, few have suffered as much as the music industry.

Global music industry revenue growth for 2020 went down over 34 percent from 2019, and that covers everything from album sales to live performance revenues to subscription service payments.

In the UK alone, 85% of live music revenue was lost in 2020, with only the first three months of the year able to generate any profits before national lockdowns took hold. Furthermore, according to a survey conducted by U.K. Music…

“65% of music creators’ income was lost in 2020, rising to over 80% for those most dependent on live performance and recording studio work. For these performers, many have seen their income reduce to zero since March.”

When it comes to live music, in one fell swoop, from artists to set crew, sound and video, merch staff, security, venue staff, bartenders, cleaning crews, venue owners, and more: all of these people lost their jobs this year. And with no indication as to when public gatherings will be safe again in most countries, live music is still off the table for the foreseeable future.

This is contrasted by scenes of large crowds at music festivals in the South Pacific, such as the Big Mountain Music Festival in Thailand or Rhythm & Vines in New Zealand, events that safely housed tens of thousands of people because their countries were able to successfully eradicate COVID-19.

So when the world shuts down and live music is unavailable, what do musicians do? Turn to the internet, as always.

Livestreaming: Lifeline or Stopgap?

Livestreaming has become an obvious measure adopted by musicians big and small, but is it the lifeline it has been built up to be, or is it more of a stopgap?

In the initial months of the pandemic, live streaming primarily consisted of artists big and small playing in their homes – for instance, Parachute’s Will Anderson had weekly shows called “Chill With Will” where he played Parachute albums front-to-back acoustically in his bedroom – but as the year progressed, artists began to get creative and invest in their live streams.

These investments included renting out spaces, ramping up audio and video production values, selling tickets, and coupling the streams with limited runs of exclusive merchandise. A few success stories in this realm include Dua Lipa, Travis Scott, Machine Gun Kelly, Story of the Year, Jimmy Eat World, The Starting Line, and Underoath.

According to Forbes, when Underoath launched their new online store for the streams, “within the first 10 seconds…280 people had visited the site with a conversion rate of $800 per email…[passing] the six-figure threshold in the first two days of sales. Not only [did the livestreams] match the gross of a major six-week tour, but without the accompanying expenses—buses, gas, flights, hotels, freight, and a full road crew—the band members and limited crew [walked] away with significantly more money in their pockets.”

To get in on the action with these types of high-quality live streams, independent companies have begun popping up to help smaller artists continue to generate meaningful connections through live performance.

One notable example is Nashville’s Tuneden Live, a series put on by touring music industry professionals that provides independent artists with a studio space to perform, a high-quality multi-camera setup, as well as top-notch audio for the performance, all accompanied by a virtual tip jar so viewers can tip the artists.

Also getting in on helping artists remain viable via live streaming is Show4Me, a global platform building new monetization infrastructures for musicians, providing dedicated concert pages, ticketing, built-in event streams, and even crowdfunding.

New Music in the Pandemic – Wasteful or Successful?

While the long-term viability of live streams continues to be determined, many artists shied away from them in favor of creating and releasing new music. And if there is one artist that has outright owned this period and shown an innate ability to harness his current fanbase, it is Machine Gun Kelly.

Despite releasing his hip hop masterwork, Hotel Diablo, just one year prior in Summer 2019, MGK released by far his most successful album to date in fall 2020, the pop-punk crossover, Tickets To My Downfall. He followed the album several months later with a full-on video musical version of Tickets entitled Downfalls High, an ambitious visual project shot in four days that debuted to 16 million views on its online opening weekend.

Machine Gun Kelly has undergone a successful artist transformation during the Covid crisis. (Image: YouTube.com)

Tickets earned MGK his first Billboard number one album, his first MTV Moonman, his first Times Square New Year’s Eve performance, and his first appearance on Saturday Night Live. All done without having to go on the road, and set up brilliantly by using quarantine to not only crank out covers, but also by putting out five new songs, with some becoming the number one trending video on all of YouTube. Not bad for a guy stuck at home who normally lives on the road.

But not everyone is as lucky as MGK. Many artists put out records this year that simply came and went without tour support.

Senses Fail’s Buddy Nielsen touched on the dilemma of releasing or holding onto music during this time, saying…

I spent two years making [this new record] and if I don’t get to tour on it, it will basically be a waste financially and a large loss. The model now is to pump out music and hope it goes viral. Not something that works for a 20-year-old band…Basically, as soon as the record comes out, it’s over. The only way to extend the life of the record is to tour on it. Once it’s out, it’s out and basically becomes irrelevant in the mind of most consumers & labels. Labels no longer push records after they come out, unless it’s viral…There just isn’t much to do. Most bands are hanging on to their records in hopes we can tour this summer, but I highly doubt that happens.Buddy Nielsen (Senses Fail)

Everyone in the industry wants to know when it can get back to normal and unfortunately, at the time of this writing, there is simply no answer. There are estimates theorizing that touring could potentially come back in America in some form by late Summer/Early Fall, and late Spring overseas, but even that is not guaranteed. However, if vaccinations go up and cases trend down, there is a chance that American bands can tour other countries to sustain themselves before getting to tour domestically.

The Grammys have been canceled, as has Glastonbury, Coachella, Stagecoach, Atlanta’s Sweetwater 420 Festival, and the California Roots Festival. Both the Governor’s Ball and New Orleans Jazz & Heritage Festival both being postponed to the Fall from their normal Summer slots, so the fate of live shows could be decided in the first six months of 2021 to see how case numbers change.

Photo: Monrroe (read the full interview here)
In the first few months, I was loving lockdown. Then when it started to drag out, I began to lose steam with making music. It’s hard to make tunes when you know there’s nowhere for them to go. A huge part of the writing process for me is going out and listening to other tunes through a system and thinking that I want to remake that. It’s such a big inspiration for me as a producer and it’s weird trying to emulate that feeling without clubs.Monrroe

To Open or Not to Open

When touring comes back is intrinsically linked with venue regulations, and venues are struggling, hoping that landlords cut breaks, with owners covering costs with PPP loans and insurance money. But that can’t last forever.

On the bright side, global governments have, in some cases, done their part to provide some form of bailout for music industry workers. 

The UK government contributed the [$1.9 billion] “Culture Recovery Fund” to help keep the live music industry afloat in its absence, while in the US, the Save Our Stages section of Congress’ COVID-19 stimulus relief bill provided a $15 billion lifeline.

According to an extensive Rolling Stone piece, under the provisions of the US bill, independent venues can apply for Small Business Administration grants up to 45% of their 2019 revenue to cover six months of employee pay and general overhead costs.

Nashville’s Michael Grimes, who not only operates The Basement and The Basement East venues, but also Grimey’s, Nashville’s most notable independent record store, praises the bill, saying that, “the parent companies are probably fine, but below that, that’s where people are getting hurt.”

Grimes hopes to take this and help parlay it into instituting reduced capacity shows, telling Pollstar

If I can’t [safely] do 100 people…it’s hard to imagine who can. And that’s the tricky part. We have to pay rent and insurance no matter what.Michael Grimes

Reduced capacity shows could certainly be a solution, but without aggressive distancing, sanitation and PPE protocols in place, as well as touch-free merchandise sales, not to mention artists that can still afford to be on the road while selling fewer tickets, these shows may prove too risky in the long term unless coupled with down-trending case numbers.

Paolo Gregoletto, the bass player for Trivium, also weighed in on the impact that COVID-19 has had on his life as a musician:

I think COVID’s impact on the music industry and economic “recovery” has mirrored a lot of the broader trends we are seeing around the world. Streaming revenues and the stock market are booming, many local venues have closed for good while we continue to see Great Depression level unemployment in America. Mixed messages for what we need to do to get out of this seem to be the best we are going to get from the government. Touring in 2021 feels like it’s hanging in the balance and I don’t think we are gunna really know what is happening till March or April for the summer tour. I think Trivium has weathered this as good as we could have possibly hoped for amidst all this uncertainty. We luckily had an album ready to release last year, we pulled off one of the first big live streams, followed it up with two DIY ones, and have luckily avoided getting sick. Alex and I moved to Orlando to make sure we could continue to work with as little travel as possible. We had a great deal of good luck and timing with some things and we made sure to work to turn that into something that could help us get through this. We are both planning for touring and no touring this year at the same time.Paolo Gregoletto (Trivium)

Was the Pandemic Good or Bad for Music Sales?

So live music and album release campaigns may have suffered in 2021, as did general music-related revenues – retail giant Guitar Center filing for Chapter 11 bankruptcy comes to mind – but what about sales of recorded music?

In July, with lockdowns only recently ending, the Los Angeles Times reported that physical media and brick-and-mortar music retailers were struggling, seeing vinyl sales growth flatten by 30% compared to the previous year, owed largely to the cancellation of the beloved Record Store Day, which accounted for 11.2% of 2019’s total vinyl sales.

However, vinyl ended up rallying in a very big way. Capped off by a 1.842 million-selling Christmas week, US vinyl sales wound up accounting for a whopping 27% of 2020’s total album sales, a record doubled down by that Christmas sales week, the largest week for the vinyl format since Nielsen Music/MRC Data began electronically tracking music sales in 1991.

The UK had a similar story, with 2020 vinyl sales being the highest since the early 1990’s, accounting for 18% of albums purchased for the year. With everyone at home for the majority of the year, digital vinyl sales were able to keep the format afloat, even as brick-and-mortar sales suffered.

#SaveNightClubs predicted that four out of five (81%) of nightclubs would be shut by Xmas 2020.

PRS for Music

PRS for Music represents the rights of songwriters, composers, and music publishers in the UK and around the world. As a membership organization, it works to ensure that creators are paid whenever their musical compositions and songs are streamed, downloaded, broadcast, performed, and played in public.

When asked about the impact of Covid, a PRS for Music spokesperson had this to say:

COVID-19 has undoubtedly had a devastating effect across every facet of the music industry. 2019 was a record-breaking year for PRS for Music as we distributed £686m in royalties to our songwriter, composer and publisher members. This trend continued across our April, July and October distributions in 2020 after setting strong foundations in 2019, enabling us to react quickly and robustly when the pandemic struck. Despite these results, we are all too aware that due to the pandemic, the music industry and its community continues to face unprecedented times ahead. With TV and film productions on hold, alongside the closure of businesses and public premises, and the continued cancellation of festivals, concerts and other live music events, we will inevitably see a decline in royalties distributed in 2021. We must now adapt and innovate on behalf of music creators globally, to protect the value of their rights. In support of our members facing financial hardship, we launched the PRS Emergency Relief Fund in March 2020 with our charity partners PRS Foundation and PRS Members’ Fund. So far, the fund has raised £2.1m and supported more than 4,000 music creators. The whole PRS for Music team is working tirelessly to ensure that we are maximising return and minimising financial risk for all of our members through this period of significant disruption.PRS For Music

What Does the Future Hold?

The internet’s stranglehold on music culture has only tightened during the pandemic, and that will surely continue.

Certain institutions created during the pandemic are likely here to stay in one way or another. For instance, Timbaland and Swizz Beatz’s blockbuster Instagram Live series Verzuz, which has become a cultural phenomenon, drawing hundreds of thousands of viewers each week to watch titans of hip hop and R&B culture take their catalogs and face off against one another.

Moreover, true to the Underoath example, while it certainly will not replace live shows outright, artists who find that traditional touring may not be feasible will likely see the livestream successes of the pandemic as a blueprint for future revenue streams.

Bandcamp will likely continue to grow its market share of both monetary and emotional capital, extending indefinitely their artist-friendly Bandcamp Fridays – where artists receive full revenue for any music sold – while also launching “Bandcamp Vinyl,” a crowdfunding platform to help artists press vinyl, a boon for those put off by vinyl’s high overhead costs.

Only time will tell, but it could go either way. Parts of the South Pacific are back to normal and the populus seems to be more grateful than ever to have their life back, but do we think Europe and America will go the same route? Sound off in the comments and let your voice be heard!

(Did you know that MIT created a musical representation of COVID-19? Listen to it here!)