2016 – The Year the Record Business was Reborn?

Over the past few years, reports issued by Barclays reflected a slow and steady decline of the music industry as track sales fell. However, since approximately September 2016, various United States analysts and industry executives have claimed the industry may be on an uptick. For example, the RIAA reported that in the first six months of 2016, recorded music generated 8.1% more revenue that the corresponding period in 2015. Apparently, such growth was driven by the number of streaming service subscribers, averaging 18.3 million during the first six months of 2016, as compared to 10.8 million during the same time in 2015. In addition to U.S. market increases, similar increases were felt in the U.K. and France. Paid subscription services seem to be the driving force of the increase in recorded-music business and according to founder/chairman of Beggars Group, Martin Mills, “this seems a solid and continuing [trend]” (Id) that is unlikely to revert backwards. Moreover, given the vested interest major labels have in Spotify’s success (i.e. combined, major labels own an estimated 18% in Spotify), streaming will likely continue to drive the recorded music business’s rebound in the industry. Possibly more important is the level of competition that was absent from the download world (which, in turn, allowed Apple to dominate that realm), which is readily apparent in the streaming world, considering companies like Spotify, Apple Music, Amazon, Pandora and IHeart Media who are either in the market already or becoming players in 2017. The level of competition within the streaming platform ensures one company is unable to monopolize the streaming business.

Although this is certainly a positive step for the record businesses, the road to their complete recovery is long and windy. For example, although there was a substantial increase in revenue from streaming services, sales from CDs and downloads continue on a downward spiral, likely in part due to free, ad-supported music currently available from YouTube and Spotify. Moreover, long-term sustainability of the streaming platform to a great extent, hinges on being profitable for those technology companies who are providing the platform. Once companies like Spotify and its fellow streaming contenders gain momentum and turn profit, the effects will be felt by the industry overall, and of course, will help revitalize records label who have been patiently waiting for their comeback. Granted, the record labels cannot stand by the wayside and wait for the streaming evolution to come full circle. They, too, must invest by shifting marketing efforts to actual music consumption as opposed to the age-old transactions model.


By: Michelle M. Wahl, Esq.

* Chicago Music Guide is an Amazon Affiliate. Please help support Chicago Music Guide by purchasing from Amazon through our affiliate link. Thank you very much for your support!

Michelle is a Partner at Swanson, Martin & Bell, LLP and is licensed in Illinois and Indiana state and federal courts. With a Masters of Law in Intellectual Property, Michelle is the Vice Chair of the firm’s Entertainment and Media Practice Group and a member of the firm’s Intellectual Property Litigation and Transactional Services Practice Group. Her copyright and trademark practice focuses on intellectual property prosecution and related transactions, including performing trademark availability searches and providing advisory opinions, as well as preparing and filing trademark applications with the United States Patent and Trademark Office, and copyright registrations with the United States Copyright Office. Michelle also assists with the oversight of the firm’s extensive trademark docket and conducts required monitoring and maintenance of clients’ trademark portfolios, as well as provides clients with corporate counseling and innovative corporate solutions to address their respective needs.

Michelle further provides comprehensive representation in the drafting, negotiating and executing of various entertainment-related contracts and licenses, including but not limited to band member agreements, artist management agreements, session player agreements, performance agreements, sound engineer agreements, recording and personal services agreements, publishing agreements and licensing agreements. As a former artist manager, she has implemented many facets of national and regional tours, assembled benefit and charity concerts, communicated with various industry personnel, facilitated radio and internet publicity campaigns, arranged radio, print and internet interviews, and assisted in the development of press kits and websites promoting local talent. Michelle has also guest lectured on entertainment and intellectual property-related topics at The John Marshall Law School, DePaul University College of Law, Chicago-Kent College of Law and Azusa Pacific University (CA), as well as served as a panelist on various other entertainment-related continuing legal education courses. Michelle is an author and editor of the Litigation and Industry Updates Column of the ABA’s Entertainment & Sports Lawyers Journal and has also had numerous articles published by the Chicago Music Guide.

In addition, Michelle serves as Chair of Swanson Martin & Bell, LLP’s Community Service/Pro Bono Committee and proudly volunteers her time as President of the Associate Board and as a pro bono attorney to Lawyers for the Creative Arts, a non-profit organization that provides free legal services to eligible clients in all areas of the arts. She also currently serves as Events Chair for the Chicago Chapter of Women in Music, a non-for-profit organization dedicated to fostering equality in the music industry through the support and advancement of women. She recently served as Chair of the Young Lawyers Division for the Illinois Association of Defense Trial Counsel, where she was recognized as the Rising Star recipient and received a Meritorious Service Award and President’s Commendation.

DISCLAIMER: The information contained in these articles constitutes general information and guidance and shall not be construed as legal advice applicable to or provided for any particular person or entity, and shall not be deemed to create an attorney-client relationship between Ms. Wahl and anyone who elects to read and/or rely, to any extent, on the material provided herein. In that respect, Ms. Wahl hereby expressly and specifically disclaims any such legal relationship, but encourages any person or entity seeking a legal advocate pertaining to the issues addressed and discussed herein to contact her directly for further information. Ms. Wahl may be reached at Swanson, Martin & Bell, LLP (330 N. Wabash, Suite 3300, Chicago, IL 60611 or via telephone at her direct line: (312) 222-8585 or e-mail at: mwahl@smbtrials.com.