The music industry has many moving parts, and building a career in music has even more. But below are eight of the most important factors in today’s music world.

Social media is a cornerstone of the modern music industry, profoundly influencing the way artists connect with their audience and promote their work. Platforms like Instagram, Twitter, and TikTok are the go-to promotional tools for musicians and record labels. 

The immediacy and global reach of social media have democratized access to audiences, meaning artists can connect directly with fans instead of going through a label.

Basically, social media is not just a promotional tool but a very important force that has reshaped how artists share and create music. It’s the best thing that has happened for independent musicians.

Decades ago, it was very difficult for musicians to record music on their own. You needed to reserve a professional studio and hire an audio engineer. But fortunately, technology has advanced to the point where a teenage kid can make a song in his bedroom with a laptop and that song can give him a music career.

From 2017 to 2022, revenue from recorded music has nearly doubled, according to RIAA, which says it represents about 85% of all recorded music in the United States.

Recorded music is the main way people listen to music. It’s one of the most, if not the most, factors in today’s music industry.

Music streaming is how most people listen to music. As of this writing, Spotify claims 574 million users and Apple Music has 88 million users – the two biggest streaming platforms in the world.

Yes, people still buy vinyl records, CDs, and download music. But streaming is by far the most common way people listen to music.

Live performances and touring remain integral to the music industry. Live music provides crucial revenue streams for musicians. And it gives fans an experience like no other. I’m a firm believer that live music will never die.

Beyond the emotional impact on audiences, live shows contribute significantly to an artist’s income. Many artists rely fully on performing and others rely on it as one of their income streams. Successful tours also help enhance an artist’s visibility, which can drive album and merchandise sales.

Sync licensing is when music is paired with visual media, like TV shows, commercials, movies, and video games. And it has provided a lucrative path to success for many musicians.

Licensing also offers a chance for artist exposure. As an artist, if your music is prominently featured on a TV show, for example, that can drive streaming numbers and overall audience growth.

For content creators, sync licensing (specifically micro licensing) offers an easy way to enhance the emotional impact of their videos by using carefully selected and legally licensed music.

The licensing industry has evolved into a dynamic and mutually beneficial collaboration between the music and entertainment industries. So hopefully, it will thrive for years to come.

Music publishers are responsible for licensing and collecting royalties for the public performance, reproduction, and distribution of musical compositions. Basically, they collect money for the songwriters and artists who should get paid for a song.

Music publishers often secure sync licensing placements, see opportunities for songwriter and artist collaborations. But they’re main responsibility is to collect payments and royalties for artists and songwriters.

In other words, music publishing is part of the foundation of a healthy music industry.

Music copyright is meant to protect the intellectual property of creators. Music copyright law safeguards musical compositions and recordings, giving artists with exclusive rights to control the use and distribution of their work.

This legal framework is important for ensuring that musicians receive fair compensation for their creations, especially in the digital age where content can be easily shared and accessed. These laws are supposed to govern licensing agreements, royalty distribution, and the negotiation of contracts between artists, record labels, and other industry stakeholders.

However, U.S. copyright law has not kept up with what is needed in today’s fast-evolving music industry. Copyright infringement cases are not uncommon, highlighting the need for better legal protection in an era where intellectual property is highly valuable.

This is possibly the most important factor of the music industry. It’s a transformative and necessary force for any artists looking to make a career in music.

Thanks to social media, subscription platforms, and live performances, artists and fans can connect directly with each other in real-time. It’s more like a personal relationship than a seller-buyer relationship (or it should be).

If an artist and their team properly handles the relationship with the fans, it can ensure they have a career in music while the fans have positive life-changing experiences through the music.

Let’s take a quick look back at the music industry – what it used to look like for artists and what it looks like today.

This is when the big record labels, like Sony, Universal, and Warner, owned the industry. You couldn’t get any music out to the world without them. But if you go discovered by one of these labels, they would promote you on a massive scale. So there were fewer blue-collar musicians and more superstars. 

The labels offered artists financial support, artist development, recording resources, and wide-reaching distribution and marketing channels. The core revenue streams back then were all physical – vinyl records, cassette tapes, and later CDs.

But that all changed with the rise of the internet…

The early 2000s is when the internet started to become more widely available. In 1998, CD Baby launched as the first music distributor, primarily focusing on distribution of CDs to record stores. In 2001, iTunes made its debut, becoming part of Apple’s ecosystem. And CD Baby then offered digital distribution to iTunes, democratizing distribution for indie artists. 

However, despite iTunes’ success, it struggled to compete with the allure of free and unlimited music – namely, piracy. This is when the traditional music industry faced a decline. Physical distribution and download-to-own services succumbed to the challenges posed by online piracy. 

By 2008, approximately 95% of all digital music was estimated to be downloaded illegally, according to IFPI. Simultaneously, the emergence of new-era digital platforms like Myspace (2003), Facebook (2004), Youtube (2005), and Soundcloud (2007) introduced novel ways to gauge success, shifting the industry’s focus to metrics like play counts and likes.

In this chaotic, rapidly changing environment, it was difficult to find footing as an independent musicians. But it also gave no-names a chance to become superstars, like Justin Bieber, Shawn Mendes, Soulja Boy, and Colbie Caillat. 

Between 2010 and 2015, the music industry experienced a historic low, with recording industry revenues falling below $15 billion in 2010 and remaining at that level throughout this five-year period.

However, amidst this downturn, the industry found its response to digital piracy. Spotify formed in 2008 and launched in the U.S. in 2011. From there, streaming saw a remarkable 700% growth from 2010 to 2015. Apple Music launched in 2015, which only helped fuel the flames of music streaming.

Over these years, social media started to have an even more significant presence. It began to be the main way artists were sharing and promoting their music.

Then came TikTok. Even though it launched in the U.S. in 2018, it didn’t start gaining massive popularity until about 2019-2020. 

The platform’s short-form video format, user-friendly interface, and algorithm-driven content discovery made it a breeding ground for viral music trends and challenges. Songs started going viral. Indie musicians found themselves a career-defining fanbase off of one video. So even more musicians flocked to the platform, growing by nearly 200 million users from 2020 to 2021.

The other social media platforms saw how engaged users became, so they started changing their algorithms to work similarly. So nowadays, everything is about short-form content. Artists are trying to go viral, or simply just find their audience, through short videos.

A music career today usually involves multiple streams of revenue. And there’s a good chance you will be a middle class musician, not a superstar.

But that’s fine. As long as you are making progress toward your ideal music career, you’re succeeding. Those who succeed are the ones who don’t quit.

More specifically, here are some of the main ways musicians are making a living in today’s music industry…

Distributing music to streaming platforms like Spotify and Apple Music allows independent musicians to earn royalties based on the number of streams. Some artists make their living entirely from streaming. Most artists need more than streaming revenue to make a living. But as long as streaming is the main way listeners consume recorded music, it is something every indie artist needs to focus on.

Concerts, gigs, and live performances remain significant sources of income for many musicians. Touring, whether locally or internationally, provides opportunities to connect with fans and generate revenue through ticket sales, merchandise, and fan interactions.

Creating and selling merch like T-shirts, hats, and mugs can be a lucrative income stream. For many performing musicians, merch has a bigger ROI than ticket sales. And fans want tangible items that both remind them of a great night of live music and that support their favorite artists.

Platforms like Patreon and Kickstarter give fans a chance to financially support musicians while getting something exclusive in return. Subscriptions platforms fans contribute on a recurring basis, while crowdfunding platforms let fans give a one-time gift for a specific project.

Licensing music for use in films, TV shows, commercials, and video games can generate a decent income for independent musicians.

There’s also the micro sync licensing niche, which is when an artist (usually in partnership with a sync licensing company or library) gets paid to let smaller creators use their songs. These would be YouTubers, podcasters, indie filmmakers, and small businesses.

Lots of musicians offer music lessons, workshops, or online courses to share their expertise and generate income. This not only provides financial support but also helps in building a community around their art.

Building a strong social media presence can attract companies who will ask the artist to talk about their product in exchange for payment. For example, a company that makes audio interfaces may offer to pay a music producer with a big following to talk about their new model.

If an artist grows a large enough following on a website like YouTube, they can turn on advertisements and earn money per view and per click.