Finance, Distribution and Accessibility of Music

 

Finance

Music Videos are financed by the record label to which an artist is signed to. In order to do this, the label collect all royalties collected from the video. Royalties are payments made to the company for the ongoing use of the video through watches. Royalties are usually displayed as a percentage of the revenue generated from or a fixed amount per stream or watch of the video.

Distribution

There are three different types of music distribution: Direct-to-Fan, Physical and Digital.

Direct-to-Fan (D2F) distribution: this is where artists sell their music and merchandise directly to fans. They keep a large percentage of the sale price than artists who use traditional distributors. This is because artists using D2F usually handle all aspects of the sale.

Physical distribution: where music is distributed through CDs and Vinyls, straight in to the hands of the listeners. Music is sold in shops, providing fans with physical copies of albums. 

Digital distribution: specialising in distributing music in digital formats. This could be through MP3 files and sold to online retailers such as Apple Music and Amazon Music. Listeners can access music on their phones through online platforms such as Spotify, and can use them on social media apps such as Tiktok and Instagram. Digital distributors take a smaller cut of sales than D2F distributors. 

Most music is distributed through companies such as Ditto and Peeksound, who sign record deals with record labels in order for songs to be published by platforms like VEVO and YouTube. However in recent years, due to the rise in social media platforms such as TikTok, smaller artists have found other ways to distribute their music. They do this through posting small promotional videos featuring parts of their songs in order to gain and maintain a following. This has worked for artists such as Lil Nas X, The Weeknd and Shawn Mendes. 

How Audiences Access Music

The largest platforms to access music are Spotify, Apple Music and Amazon Music. For music videos, the majority are accessed on YouTube and Tiktok. 

Spotify: currently the largest streaming platform in the world, where listeners can stream music, videos and podcasts. 

Apple Music: has access to over 50 million songs, and remain the second most popular streaming platform in the world.

Amazon Music: is an online streaming service and music store with around 2 million songs.

YouTube: a video-streaming platform that allows both artists and fans to upload videos. Artists can publish music videos and monetize them through YouTube Content ID.