by Alex Cosper (7/22/13)
A better question might be: how much money do rock stars lose? Becoming a rock star can be very costly, especially for bands that have to pay their own expenses. Even major label acts that make thousands of dollars per show will still have to pay for travel, food and hotels. Sometimes the label or management pays the expenses, depending on the deal. But many times, expenses are deducted from musician payments. Only a small percentage of major label acts end up living the good life, while a high percentage of rock stars are forced to get regular jobs at some point.
The bulk of rock star income comes from touring, but some artists who sell a lot of recorded units can make big money, but usually songwriters are who make steady royalty checks, mostly from radio airplay. Radio stations and live venues pay performance rights organizations such as ASCAP and BMI, who then pay songwriters and publishers, who also earn percentage points from record sales. Artists who regularly play big shows can gross $100 million per year. Such stadium or arena acts might command $100,000 per show. Promoters usually pay popular artists upfront plus a percentage of ticket sales then promoters take the risk to recoup the profits from ticket sales.
At the other end of the spectrum, up and coming artists who might have limited airplay or press coverage are likely to play small venues with capacities of 100 to 1000. These acts are less likely to be paid an advance, unless they have a track record of consistently selling out venues across the country. The acts who travel from town to town that don't have predictable crowds may get a smaller advance as low as a few hundred bucks. In some cases up and coming acts actually pay venue owners to rent their facilities and recoup money from ticket or cover charges.
Ultimately a high percentage of rock stars end up broke when they finally decide to call it quits. Not only can the cost of travel eat into profits quickly, the cost of musical gear can be expensive, especially if the band is more extensive than guitar, bass and drums. Sound systems, electronic instrument equipment and other gear can be a huge investment. The most economically efficient musical act is the one musician acoustic performer. Such acts have every little expenses and can make high profits ranging from $100 to $1000 per night as independent artists. Several bands that get college radio airplay can also make high profit margins, as indie acts tend to make better percentages off record sales than major label acts. National college radio can command sales of 200,000 units, which can give each musician a comfortable income.
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