(host 1) When you think of your favorite band or musician, what image comes to mind?

For a lot of people, it's fancy cars, Gucci jewelry, and a mansion in Beverly Hills.

But this kind of lifestyle is becoming less and less common, even for artists on major labels.

The median musician makes about $35,000 a year, and not all of that comes from music.

A lot of artists need other gigs, and even the ones who can survive solely on music are often middle-class.

With less people buying music and artists making very little from streaming, the bulk of a musician's income comes from playing live shows.

But because the COVID-19 pandemic is preventing these live shows from happening, many musicians are more strapped for cash than ever.

For most musicians, it's a constant hustle, with little return.

This is why Julia and I decided not to pursue this career ourselves.

Even though I love to play guitar... and I love to sing... ...we just couldn't see how a career in music would be financially sustainable.

But we don't want to see other musicians throw in the towel.

Their music is too important.

It helps us enjoy life, feel moved, and see things from new angles.

So is there something fans can do to help, or is a music career a thing of the past?

[whimsical music] [coins jangling] ♪ (host 1) Popular music was more or less invented in the early 20th century, thanks to two technological innovations: radio, which allowed people to discover new sounds, and the phonograph, which allowed musicians to monetize their songs by selling copies.

Though the physical format has changed over the years, the basic system lasted for most of the century, giving rise to hundreds of famous artists, from Nat King Cole to Britney Spears, and spawning several multi-billion-dollar record labels.

This business model was upended in the late '90s, with the invention of an audio codec called the mp3 and a file-sharing program called Napster.

Suddenly, songs could be encoded into very small file sizes, and Napster let users share them with each other for free.

All you had to do was search the song or artist you wanted to hear and you'd be connected to a user who had that music.

For the first time ever, listeners had an entire world of music at their fingertips.

It was awesome for them... not so much for the musicians, who felt like their work was being stolen, which, well, it kind of was.

The major record labels weren't so happy about it, either, since Napster wasn't paying them royalties.

They came after the company with copyright lawsuits and won, causing Napster to declare bankruptcy in 2002.

(host 2) But the genie was already out of the bottle.

New file-sharing programs popped up to fill the void left by Napster, and though there were legitimate ways to digitally purchase songs, like Apple's new iTunes platform, it's really hard to compete with free.

The industry struggled to monetize, and music sales plummeted in the 2000s.

Some economists describe this as a categorical change.

Psychologically, consumers had categorized music as something that you didn't pay for, like emails or tortilla chips at a Mexican restaurant.

Categorical changes are really hard to reverse once they've taken hold.

But the following decade, the music industry figured out how to get people to pay for music without feeling like they were paying for music: subscription streaming services, like Pandora and Spotify.

For a flat monthly fee, subscribers can listen to all the music they want, and the platform pays royalties each time a song is played.

These royalties are split between songwriters, publishers, record labels, recording artists, and managers.

Geez!

Talk about a lot of middlemen!

Even though these royalties make up 80% of the music industry's revenue, the musicians themselves tend to make very little.

In 2019, artists earned on average 0.00437 cents on Spotify and 0.0168 cents on Pandora.

Other streaming services weren't much better.

These rates aren't set in stone, though, and vary by artist.

That's because streaming services usually take company earnings and divide them up based on how many streams a particular artist has.

(host 1) So if you pay $9.99 a month and only listen to one obscure indie band, in a perfect world, the entire ten bucks would go straight to that band.

But that's sadly not how it works.

The money is split by every artist.

And not equally, either.

If, say, Billie Eilish gets 10% of all streams on Spotify, she'll get 10% of your money, even though you never listened to her.

The more streams an artist has, the bigger piece of the pie they get.

I wish we could say this money adds up to a pretty hefty paycheck, but that's not usually the case.

Musicians would need about 87,000 plays a month on Pandora to earn the national minimum wage, and about 336,000 plays on Spotify.

Even if you manage to get millions of streams, it's still not a big payout.

So if streaming services aren't typically lucrative, and you can't go to live shows right now, how do you support your favorite musicians?

Thankfully, there are lots of ways.

You could pull a 1999 and buy their music.

Artists signed to major record labels often make 10 to 15% off these sales, and indie artists earn even more.

So, if you buy their album for $10, they'll make at least a buck.

But, what if the album is already on a subscription service you use, like Spotify?

In that case, you might consider buying their merch.

This could be a T-shirt, hoodie, perfume, or... a doormat?

Man, Swifties aren't messing around!

(host 1) Artists who run their own merch can take home most or all of the money they make from those sales.

Other artists typically earn around 30% of the merch sale, depending on the deal they have with the merchandising company.

If you'd rather support your favorite musicians directly, see if they have a Patreon, which lets fans pay creators every month in return for cool rewards like live performances and unreleased music.

Some artists are even streaming live on Instagram, Facebook, Youtube, and Twitch, which may allow you to tip them.

Or maybe they're playing full-blown digital concerts on StageIt, where you can buy tickets.

Soundcloud even lets you send money directly through their Paypal, Venmo, or Cash App.

You could also support musicians through good old-fashioned word-of-mouth.

Post about the band on Facebook.

Make your roommate listen to them.

This gives them new listeners, who could turn into fans and supporters.

Plus, the more buzz a band gets, the more likely they'll catch the attention of filmmakers and advertisers for those sweet licensing deals.

[rock music plays] However you choose to support musicians, we suggest going beyond streaming services.

These services are a great way to discover new artists, but they're not a great way to support them.

If you really like a band, consider buying their albums or merch, or watching them perform.

They get more money that way, and the joy and fulfillment these artists bring our lives is worth paying for.

(both) And that's our Two Cents!