Thursday, October 14, 2004

In the "So What?" Department

Wizbang's Kevin Aylward laments the distribution of income from CD sales:
This breakdown of the cost of a typical major-label release by the independent market-research firm Almighty Institute of Music Retail shows where the money goes for a new album with a list price of $15.99.

$0.17 Musicians' unions
$0.80 Packaging/manufacturing
$0.82 Publishing royalties
$0.80 Retail profit
$0.90 Distribution
$1.60 Artists' royalties
$1.70 Label profit
$2.40 Marketing/promotion
$2.91 Label overhead
$3.89 Retail overhead

That's a pretty remarkable breakdown. Label[s] get $7.01per CD and retailers get $4.69 for a combined percentage of 73% of the price of each CD. Royalties, artists, and manufacturing costs combined total only $4.29.
Is someone forcing the artists to record at gunpoint? Why don't we just take half of everyone else's share and give it to the artists? Mmmm...I wonder what would happen to the marketing and sales of CDs then.

Here's a better way to look at it, Kevin. The artists' royalties from each CD are split among a small number of people. All the other entities in the production-distribution chain are corporations who have to cover the cost of wages, benefits, rent, utilities, supplies, lawyers, etc., etc. It's fair to say that artists, per capita, do better than everyone else in the chain. But, as I asked above, is someone forcing the artists to record at gunpoint? If not, what they make is no one else's business.

I'm surprised that a blogger who seems otherwise to have a firm grasp of conservative-libertarian principles would presume to second-guess the outcome of free-market transactions.