Rockonomics is a backstage tour of what the music industry can teach us about economics and life. The book is an expansion on a speech the author gave at the rock and roll hall of fame. There are dozens of interviews included with musicians and executives which allowed for some great insight on what goes on behind the scenes with music and when it comes to money – which is something I don’t generally think about. “To truly understand and appreciate music, you need to understand economics” (These were my worst courses in college, so, yikes!) Something I found interesting is that if a song has a collaboration with a big star – they are usually within the first 30 seconds of the song because you are only paid if your song is played for over 30 seconds. So if a fan is expecting to hear Justin Bieber, he better show up in 30 seconds or they will turn the song off and you get no streaming credit! I also found it interesting that most income comes from touring and merchandising and that some rappers release their “Mixtapes” for free and recoup all costs from touring and merchandising alone. And while a great business sense is helpful – sometimes it is just LUCK! Elton John got Bernie’s envelope from a stacks and stacks of envelopes that were at the office. Meant to be, I guess! Could you imagine a world without Elton and Bernie’s songs? I can’t!
I received a free e-copy of this book in order to write this review, I was not otherwise compensated.
About the Book
Alan Krueger, a former chairman of the president’s Council of Economic Advisers, uses the music industry, from superstar artists to music executives, from managers to promoters, as a way in to explain key principles of economics, and the forces shaping our economic lives.
The music industry is a leading indicator of today’s economy; it is among the first to be disrupted by the latest wave of technology, and examining the ins and outs of how musicians create and sell new songs and plan concert tours offers valuable lessons for what is in store for businesses and employees in other industries that are struggling to adapt.
Drawing on interviews with leading band members, music executives, managers, promoters, and using the latest data on revenues, royalties, streaming tour dates, and merchandise sales, Rockonomics takes readers backstage to show how the music industry really works–who makes money and how much, and how the economics of the music industry has undergone a radical transformation during recent decades.
Before digitalization and the ability to stream music over the Internet, rock stars made much of their income from record sales. Today, income from selling songs has plummeted, even for superstars like James Taylor and Taylor Swift. The real money nowadays is derived from concert sales. In 2017, for example, Billy Joel earned $27.4 million from his live performances, and less than $2 million from record sales and streaming. Even Paul McCartney, who has written and recorded more number one songs than anyone in music history, today, earns 80 percent of his income from live concerts. Krueger tackles commonly asked questions: How does a song become popular? And how does a new artist break out in today’s winner-take-all economy? How can musicians and everyday workers earn a living in the digital economy?