MIDiA just lately, and completely, revealed that expanded rights now signify 10% of the recorded music market with revenues of $3.5 billion. These revenues, derived principally from monetising the model of the artist (merch, sponsorships, branding, reside, and so on.), signify a shift in strategic focus for the worldwide music enterprise. It’s shifting from a consumption economic system to a fan economic system. That is solely the beginning. To actually harness the huge potential of a fan economic system, three key issues have to be addressed:

1.     Picture and likeness: The music business’s present social media focus may be the UMG / TikTok spat, however the true battle can be over the cultural worth of artists on social. As music creators make investments more and more extra time into making social content material, their pictures and likenesses are powering social media engagement and revenues. We’re on the level the place some worth alternate must be established. Again in 2021, we laid out the case for a creator proper (the linked report is free to obtain) that ensures creators are remunerated at any time when they generate worth, no matter whether or not their music is being carried out. With the ascent of generative AI, the idea is required greater than ever. The music enterprise is waking as much as the significance of picture and likeness. {The catalogue} deal for Tina Turner included these rights, whereas Bob Marley’s property bought his catalogue however retained his picture rights as a result of they’ve used them to create a international Marley branded empire. Likeness rights have an extended historical past, with the primary large ‘win’ being actor Crispin Glover settling with Common Studios in 1990 for infringing his likeness after they altered the looks of one other actor to appear to be him with prosthetics as George McFly in Again to the Future Half II. This resulted in The Display Actors Guild prohibiting its members from mimicking different actors. Music wants a George McFly second. The state of Tennessee defending artists’ voice and likeness could also be a primary step.

2.     Reconfiguring streaming: MIDiA has been saying for years now that there’s a lot Western streaming can be taught from China’s fandom-focused strategy to streaming. Whereas Chinese language fandom revenues have just lately taken a success as a result of governmental coverage shifts, the underlying premise of constructing streaming about fandom and expressing identification stays essential. Artist subscriptions are an apparent subsequent step, making streaming about lean in fandom reasonably than lean again consumption. We’ve got written about artists subscriptions quite a bit – just lately; greater than a decade in the past; and in governmental coverage submissions. James Blake’s escapes could have soured urge for food, however that’s, partly, as a result of stand alone subscription apps face an uphill battle. The obvious alternative is to make them a part of the core streaming expertise. The outdated web was ‘construct it and they’re going to come’, at present’s is ‘go the place the viewers is’. However there’s extra to do than artist subscriptions. Giving customers profile pages the place they will purchase and earn fandom badges might be an important first step, one thing pioneered within the West by Audiomack and additionally seen on apps like Fave and Renaissance. HYBE is prepping Weverse for worldwide growth, Spotify appears set to make some strikes quickly, and each Sir Lucian Grainge and Rob Kyncl are main their respective firms on this course too.

3.     Nurturing, not harvesting, fandom: There are two risks inherent in file label superfan methods: 1) weaned on lean again streaming, superfans won’t be tremendous sufficient, and a pair of) it’s all  too straightforward to deal with monetising fandom reasonably than nurturing it. As a lot as Korean labels like HYBE, SM, and JYP may be industrialising fandom and exploiting followers, they at the very least perceive the significance of constructing and nurturing fandom (check out the chart from JYP’s earnings to grasp their fandom strategy). File label expanded rights had been up 16% in 2023 and can proceed to develop strongly. It’s incumbent on file labels to contemplate followers as a scarce useful resource to be cultivated, not merely monetised, in any other case the soil can be left exhausted and barren.

Together with non-DSP and vinyl, expanded rights signify a part of the fashionable music business’s multi-faceted fan technique and 2023 was arguably the primary yr of this new music enterprise period. Streaming shouldn’t be going away. Certainly, it is going to be a part of this future, however the consumption-focused strategy of the 2010s goes to be shunted to the facet as fandom takes centre stage. Not a second too quickly.