Irving Azoff And The “De-Monetization” Of The Music Industry

The following article from Business Week is a very telling sign. Is there any reason not to believe that artist management is now in the drivers seat for the music industry?  A place where 360 deals are a natural part of the entertainment landscape and where the business of touring and sponsorships can thrive.  All that will be left for some of them to add is in house promotion/marketing/new media. Then once the current artist deals are fulfilled at labels, look out.

Posted by: Jon Fine

TicketMaster Entertainment CEO Irving Azoff, appearing at News Corp’s annual All Things Digital conference in Carlsbad, California, proved an interesting and free-speaking interviewee. Although, churlish as it may be, he was much more interesting and free-speaking about the macroeconomics of the music industry than on the specifics of his company—and its proposed merger with LiveNation Inc.—and the criticisms lobbed at it. (I’ve hit one such lob myself.)

“Recorded music is more a marketing tool than a revenue source” for acts now, said Azoff, who also still manages the likes of The Eagles, Neil Diamond, and Christina Aguilera. His storied career, and well-earned reputation as one of the fiercest and savviest managers in the business, took flight with the Eagles, back in the Seventies when both Azoff and his artists were significantly more mustachioed and bushy-haired than they are today.

They also had a much easier time making a dollar back then. Today,“recorded music is down to less than 6%” of major musical acts’ revenues, he divulged. To put this in its proper perspective, consider that such income once was such acts’ “biggest revenue source,” he added.

Much of what Azoff said pointed to a view of music revolving around the live music experience. This, obviously, plays into his wheelhouse as one overseeing business interests so dependent on concerts. Still, his logic is convincing, and the examples he cited concerning what he called the “demonetization” of the music business were striking.

Artists walk in to his office, Azoff said, “who used to make $300,000 to $500,000 a year in royalties [from selling recordings]. And now that’s diminished to less than $50,000” a year. This means, unsurprisingly, “the creative side” of the music business is “very anxious” about the changes that have swept this landscape.

His answer, as cringe-inducing is it may be to artistic types uncomfortable with the ways of business, is understanding the branding and promotional value of music. He cited new deals like his client Aguilera working with Procter and Gamble to launch a line of fragrances.

A glimmer of hope for his old-school artists: While Azoff said CD sales have been declining alarmingly, and especially back-catalog CD sales, that business “appears to be bottoming out.” And, he added, “I don’t think the CD will go away totally.”

Compare all this candor to the following exchange regarding TicketMaster and its proposed merger with LiveNation:

Interviewer Kara Swisher: How do you answer criticisms that [the merger] creates this behemoth.
Azoff: We think everything we do revolves around what’s good fir the artist and what’s good for the fan.

As Swisher pointed out, songwriter-cum-secular-saint Bruce Springsteen, among others, strongly objects to this view. But Azoff said that Springsteen was “uninformed” about what his company did.

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2 Responses to Irving Azoff And The “De-Monetization” Of The Music Industry

  1. Janet Hansen says:

    This is good! While some will say the top brass in music think greed is good…what is written here makes good sense, in that live music is where we should focus. As a nation we’ve grown up being in the company of friends and strangers to hear musical stories being told. Some of the music becomes like an epic novel in the making; and since music is a literate art form it makes sense that the best musicians are great storytellers. They touch our emotions in a cumulative way as no two people hear music the same way. It’s the emotion that drives the music to epic proportion.

    Since media can no longer afford to review live music as it once did, freedom of the press is being put directly into the hands of those who attend live performance.

    Pete Seeger, the legendary folk singer said, “Participation will save the human race.” At this historic moment, participation in music will be its saving grace. Music is a contact sport. Go. Listen. Then tell us something good whether the concert you attended was a headlining act at an ampitheater or a small club anywhere USA. We want to hear about who our best writers are. The rest will follow.

    Janet Hansen
    Scout66.com

  2. Nic says:

    I cant wait for change as well as other fans of music around the world. I’ve been waiting on something like this for the longest time. Im tired of these lame instrumentals it’s so repetitive. LIVE MUSIC BRING IT BACK. Take us back too the good’ol times. With the economy going the way it is today I feel that something bigger than gigantic is going to evolve. Bring back the quality and value back down to earth so that everyone can enjoy real music.

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